UTILITY COMMITTEE

The Utility Committee Meeting was held on December 8, 2008 at 5:00 p.m. with Chairman Ruane presiding. Members present were Mr. McGiffin, Mrs. Williams (arrived at 5:02 p.m.), Major Kosior, and Mr. Snaman.

AGENDA ADDITIONS/DELETIONS

Mr. Snaman moved for approval of the agenda, seconded by Mr. McGiffin and unanimously carried.

PACE/NAES Monthly Report (October)

Members were provided the PACE/NAES Monthly Reports for October 2008. The reports are being provided to allow members the opportunity to monitor what is being sold in electric and the revenues received, which will give members a better understanding of any fluctuations and make improvements if deemed necessary. Although it was not staff’s intention to make a presentation of the report, they welcomed any questions.

Greenhouse Gas Emissions Issue/SO₂ Market: DC Circuit Court Vacation of CAIR

During their meeting of September 22, 2008, members were provided information regarding the changes to the sulfur dioxide allowance market and it was explained that Title IV of the 1990 Clean Air Act Amendments enabled the first market-based mechanism for controlling emissions and created the SO₂ allowance. Members were reminded that the DC Circuit Court vacated CAIR and as a result, there is an abundance of SO₂ allowances in the market place. It was suggested that Congress would like to address these allowances which would return the value of the SO₂ allowances.

At that time, Mr. Ruane suggested that when the City is presented with opportunities, such as this, they should be discussed with the legislators. He requested that staff develop a list of issues and proposed changes that are of interest to the City of Dover, and supported by the legislators, to be presented to the committee for consideration and development of recommendations to submit to the legislators for their consideration.

Mr. Ruane referred to pages 2 and 19 of the PACE/NAES Report regarding the Emissions and Allowance Management. He requested members to review this issue to determine if the congressional delegation should be contacted to discuss the City’s concerns. He noted that the report references that many are looking for the new Congress to develop a legislative solution.

Responding to Mr. McGiffin, Mr. DePrima assured members that staff can obtain legislation that the industry, as a whole, is supporting. He advised members that in accordance with a more detailed report regarding this issue provided by PACE, there is legislation and that all parties involved, including utilities and applicants, support stronger legislation. He suggested that the City utilize the services of PACE to determine which legislation or legislator should be contacted.

Mr. DePrima suggested that the City request the services of PACE to assist in determining what legislation proposals are available and seek their recommendation as to what the City should support, based on the City’s position as a generator and as stewards of equipment owned. Once a recommendation is provided, members could discuss a strategy.

Responding to Mr. DePrima, Mr. Ruane noted that during their meeting of November 10, 2008, concerns were relayed regarding the emissions sales and the financial impact this is having on the City’s revenues.

Mrs. Williams suggested that members should examine the issue further by obtaining additional information prior to making any direct contact with the legislators.

After much discussion, Mr. Ruane stated that although he understands the unreadiness amongst members, it was his understanding that members would not necessarily become involved with the details but rather put our legislators on notice regarding the effects of this recent action. He noted that the congressional delegation is already hearing testimony regarding this issue nationally and that, so often, they are not aware of the effects on individual towns and cities. It was his intention that the City could notify the congressional delegation, while their reviewing legislation, of the negative effects the recent action has had on the City.

Mr. DePrima requested the opportunity to prepare, with the assistance of PACE, a draft letter to the legislators to be inclusive of details regarding the problems and the effects it has had to the City to be presented to the committee for their review during their meeting in January.

Mrs. Williams moved to recommend that the City Manager prepare a draft letter, to be presented to the committee during their January meeting, to the legislators, addressing the issue of the CAIR vacation and how it is impacting the City of Dover. The motion was seconded by Mr. Snaman and unanimously carried.

When the draft letter is reviewed by the committee, Mr. McGiffin suggested that members consider hand delivering the letter so that the legislators are provided a sense of how important this issue is to the City.

Energy Efficiency, Conservation, and Climate Change

Mr. Ruane requested the committee’s consideration of issues regarding energy efficiency, conservation, and climate change, as follows:

Federal Energy Efficiency and Conservation Block Grant - NLC Legislative Action Request

Members were provided information provided by the National League of Cities regarding the Federal Energy Efficiency and Conservation Block Grant. Based on his recent review of the material, Mr. Ruane felt that these are issues relevant to the work of the Utility Committee. He noted that the NLC is urging its members to become involved in an effort to understand the potential use of an energy efficiency and conservation block grant and also to help send a message to congress for its funding.

Responding to Mr. Ruane, Mr. DePrima suggested that a letter be sent to the City’s congressional delegation, signed by the Mayor and Council President, and/or a meeting be held to discuss advocating the appropriation.

Mrs. Williams suggested the need for a partnership and collaborations. She felt that a letter to the City’s congressional delegation would not be enough and that there is a need to show a partnership in this regard.

Mr. Snaman moved to recommend that the City request that congress appropriate the $2M for fiscal year 2009 to fund the Energy Efficiency and Conservation Block Grant, seconded by Major Kosior and unanimously carried.

Mrs. Williams moved to recommend that staff conduct an inquiry in terms of a collaboration or partnership with DEMEC for serving not only as a funding partner but an advocate for the funding of this Block Grant, seconded by Major Kosior and unanimously carried.

State Energy Plan - Brief Update by Committee Chair on Overall Planning Process

Members were provided information regarding the Delaware Energy Plan. Mr. Ruane advised members that he has been participating in the workgroups, which have been established for the purpose of developing a Delaware Energy Plan. His particular interest has been that the State recognizes that local communities, such as Dover, have developed their own energy plan and would like for the recognition to be included in the State’s Plan. He also felt that assistance from the State should be provided to achieve the goals of the local plans. Referring to the Block Grant previously considered by members, it was his feeling that such grant money could be used to meet some of the goals of the City’s Energy Plan. Mr. Ruane encouraged members of the committee, staff, and City Council to review the draft plans for any concerns or suggestions to be further considered by members at a future meeting.

Dover’s Climate Change Plan - How Do We Benchmark and Measure Our Progress in Reducing Greenhouses Gas Emissions

At the request of Mr. Ruane, members were provided information entitled “Lessons from the Pioneers: Tackling Global Warming at the Local Level”, published by the Institute for Local Self-Reliance in January 2007. Mr. Ruane stated that the document indicates the challenges faced by communities similar to the City that have entered into a climate change plan, noting that the City went on record indicating a desire to reduce the City’s greenhouse gases. Although there have been some very positive efforts made to this end, he noted that the findings of these efforts is that there are serious challenges in communicating to the public what has been accomplished, where the City had been, and what is the ending goal. He explained that there needs to be some type of benchmark and measurement of the City’s progress in reducing greenhouse gas emissions. Mr. Ruane stated that the establishment of some type of benchmark and measurement should indicate the current status of the City’s emissions within the corporate limits, what the City’s success has been, etc.

Mr. Snaman questioned the City’s ability to measure emissions from the various industries within the City as well as the ability to measure what greenhouse gases are produced by City owned buildings.

Major Kosior questioned what the benefit would be to the taxpayer if the City were to commission a study or hire a consultant, noting that such a study and consultant would be costly. Concurring with Mr. Snaman, Major Kosior noted the difficulty for the City to measure its own greenhouse emissions, and relayed concern with the City’s ability to deal with industry in this regard. However, he felt that the City could provide an influence for the industries to establish measurements by providing some type of incentive.

Mrs. Williams relayed reluctance to the City looking for a problem without having a solution or the ability to enforce a solution, which she felt would be a waste of manpower during a time when there are so many other priorities and issues facing the City during these tough economic times.

Mr. McGiffin felt that there were several issues involved with this matter. He questioned the importance of the City’s knowledge regarding whether its commitment is being honored and if it is enough. He noted that the article reflects that there are several methodologies available to accomplish some type of measuring mechanism; however, there were no cost estimates associated with these methodologies. Noting that this concept may or may not be costly, it was his opinion that the City should investigate the matter further to determine if it is costly so that if a decision is made to reject the concept, it would be done so based on specific information and not just because it is speculated that the concept may be costly.

Mr. Ruane advised members that there has been discussion by the committees for the State of Delaware to set a goal for greenhouse gas emission reductions by a date certain and at a certain percentage. If passed, there will be an expectation for the City to provide the information and would require the City to have a means to measure emission reductions.

Mr. DePrima reminded members that when the City adopted the U.S. Mayor’s Climate Control Agreement, the first point, which was to measure the City’s carbon footprint, was purposely eliminated. The reason for its elimination was due to the concerns regarding the costs involved and that the City could make positive efforts without going through the expense and effort of measuring a carbon footprint. At that time, he recommended this action based on research conducted which indicated that there was no easy means to have this accomplished and, in fact, there were competing and conflicting methodologies, which was indicated in the report provided to members. Even if a methodology is selected, he stated that there are questions regarding their accuracy; therefore, it would be his preference to work towards what is known to be best practices in the area to reduce emissions rather than having the knowledge of how much of the City’s carbon footprint has actually been reduced.

Mr. DePrima advised members that many in the industry feel that it is too difficult to do this measurement of carbon footprint and that the methodologies available are unreliable. He stated that during a recent NLC workshop, he was made aware of a new wave of thinking regarding this issue, which is Lead Certification. He explained that when a new building is erected, Lead Certification can be obtained at different levels. The more best practices instituted, the more points are provided and the higher level of certifications would be issued. He assured members that many communities are having difficulty establishing measurement of their carbon footprint and that the Lead Certification concept was better received by the communities during the NLC workshop.

Mr. DePrima stated that although the Lead Certification is in its early stages, he would obtain additional information regarding this issue to provide to members for their review.

Mr. Snaman moved for adjournment, seconded by Major Kosior and unanimously carried.

Meeting Adjourned at 5:51 P.M.

                                                                                    Respectfully submitted,

                                                                                    Eugene B. Ruane

                                                                                    Chairman

EBR/AC/TM/jg

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