>> I'll hereby convene our
meeting. It's 2:31 for
Pioneer Community Energies.
This is a special meeting and
we do not have a quorum. So
we're going to recess until
further notice.
>>[RECESS]
>> I'm going to reconvene from
recess and we now have
established a quorum. Our clerk
is away from. Here she comes.
She was doing something
for me. Thank you very much.
Theresa, if you'd please call
the roll.
>>[CALLING ROLL]
>> Let the record show that
Director Jones is present.
She's
in closed session currently.
So with that said,
we do have a quorum,
barely and we're going
to go ahead
without objection and recess
to closed session. Hearing
none,
that shall be the order.
>>[CLOSED SESSION]
>> Thank you very much and
we're going to reconvene
from closed session. The board
took two actions
in closed session. The first
item that we took was
to adopt the recommendations
from the employee welfare and
benefits ad hoc committee.
Those recommendations will be
placed on the July board
meeting agenda. We also took
action to recommend that this
board approve an extension,
the contract
for our executive officer
for three years, and
to make a change to his health
and vision dental package that
is actually on the consent
agenda a little bit later
today. So we did take those two
actions in closed session. Let
the record show that we do have
a couple of additional members
who have come in since we
originally called the meeting
to order, Directors Holmes and
Director Ring. So thank you
very much. And we do again have
a quorum for the purposes
of today's meeting. So
with that said, next item on
the agenda would be the agenda
review and just
to make a couple of changes,
actually, we need
to do public comment,
too.
>> We have.
>> Do we have public comment
on the agenda, Madam Clerk? I'm
not seeing it.
>> It's below the agenda
review.
>> It's presentation stamp.
Thank you very much. Sorry
about that. Okay, a couple
of quick changes
on the agenda. What I'd like
to do for the purposes of
ensuring that we have a quorum
to take action today,
because I know that Director
Holmes needs to leave
by 04:00 is
to move items three and four
after the consent agenda. And
I'd also like
to continue item 1F
to our next meeting. 1F is
the approval of the Pioneer
Community Energy's 2024-27
strategic plan. So that will be
moved to our July meeting. We
are missing several
jurisdictions here today, and
we thought that it would be
prudent to have them here
for that discussion.
Discussion.
Since it's setting our agenda
for the next three years. So
are there any other changes
to the agenda as presented at
this time?
>> I have none.
>> All right, seeing none
without objection, then we'll
consider the agenda approved as
amended.
>> Thank you for the
accommodation.
>> You're welcome. And
with that said,
there is no objection. The
agenda is hereby approved as
amended. Next item on the
agenda is public comment. This
is an opportunity
for any member of the public
to address the board
on items that are not scheduled
on today's agenda. We cannot
take action on said items,
but we can refer them to staff
for subsequent research and
potential coming back
to the commission
at a later time. The board,
not the commission. Got
to remember which entity I'm
on today. Madam clerk, is there
any public comment?
>> There are no comments
at this time.
>> All right, no public
comment. So we'll close public
comment and move right along
to the consent agenda.
Boardmembers, we have items 1A
through E on consent. Is there
any request to remove any
of those items
from consent?
>> I'd like to pull 1E,
please.
>> Any other changes
to the consent agenda?
>> Hearing none. I'd like
to entertain a motion to adopt
the consent agenda as amended.
>> I shall move.
>> Second.
>> Been moved and seconded.
Any further discussion?
Hearing none. Madam Clerk,
please call the roll.
>>[CALLING ROLL]
>> Let the record show that the
motion has been adopted
unanimously. Thank you very
much. All right, we'll move on
to item number one e, finance
administration, this is the
adopting a resolution
establishing a board member
reimbursement policy. Director
Ring, did you have questions
on that?
>> I feel like this is me
voting
to give myself a raise, and I
don't think that that is fair.
It's what I don't like in
government. I'm giving myself
more money, and so I would be
more comfortable if,
and I don't remember if it was
in there, but I would be more
comfortable if it went
into effect, say, in January or
after we were each reappointed
to the meeting, because then
it's not really giving myself a
raise,
it's giving the board a raise.
I may or may not be
on the board next year.
>> Just
for clarification purposes.
Thank you very much, Director
Ring. I appreciate what you're
saying in this instance, this
is just a policy that will
allow us to be reimbursed
should we attend a conference
or training or something
of that extent. So it's your
mileage if you are attending?
I think, I've been the only
one that has attended. As you
know, the board sent me on cap
to cap, and so I had my mileage
reimbursed. And it's just
allowing that. It's actually
just establishing a policy
because they've been doing it,
but we just have been. It's
been without a policy.
>> So this has already been
in existence the whole time,
and we're just.
>> We just need
to have a policy
to codify it.
>> What triggered it was the
annual conference
of the CCA back in April, when
we realized we didn't really
have a policy,
but we've been doing it all
along and we're gonna give them
births in April.
>> There's no per diem.
For example,
some entities that you sit on,
you get $100. You know,
this is not that. This is
simply no compensation.
There's no compensation or
raise.
>> It's simply still a benefit,
though, right?
>> Yes, there's a benefit
to the extent.
>> That you are,
but if it's already been
in existence.
>> Yes. It's just codifying
into an actual policy because
we didn't have,
we had an informal policy,
and so we just need
to put that in policy so that
it's consistent. You know, the
implementation is consistent.
It says that you'll seek
economic means by which
to travel and things
of that nature. So, you know.
But anyway. So does that answer
any. Address your concerns?
Great. Okay, thank you so much.
Are there any other questions
on this item?
>> Chair, I'll move the item.
>> All right, let me just ask
for public comment,
and I'm sure I know the answer,
but we have to do it anyway.
Madam Clerk, any public comment
on this item?
>> There are no comments
at this time.
>> Thank you. Director
Holmes?
>> Yes, I moved the item.
>> Thank you. It's been moved.
Is there a second?
>> Second.
>> Any further discussion?
Hearing none. Madam Clerk,
please call the roll.
>>[CALLING ROLL]
>> Let the record show that the
resolution has been adopted
unanimously. Thank you very
much and thank you
for your questions, Director
Ring. Appreciate them. All
right, so the next item
on the agenda,
since we move the agenda
around a little bit, is our
fiscal year 24-25 budget.
>> Thank you, Madam Chair. I
think to discuss this item will
be our director
of finance and administration,
Brad Kane.
>> Good afternoon,
Boardmembers. Theresa, if you
could bring up the
presentation. Our little street
map that we show you
of where we are
in the budget process. So the
board adopted a strategic plan
back in the years 21
to 24, and then is currently is
finalizing the strategic plan
for 24 27. Both of those
documents were instrumental
in setting the stage for
Pioneer's budget. But back in
April, the executive team got
together,
keeping the strategic plans
in mind to what do we want
to propose? What do we need
to propose to fulfill the
board's strategic priorities
and goals? And so that's what
happened in April. Then in May
and June, the employee benefit,
welfare and benefit committee
met to discuss employee issues
and pay and benefits. And the
audit committee also met in
May
to heard the proposed budget,
provided feedback,
and then this board at the may
meeting,
also heard the presentation on
the proposed budget and taking
in all that feedback. We bring
back to you today the
recommended budget. And there
are a few changes
from what you sought,
the proposed budget,
and we will go
over those few changes. So
right now we're at the June 20
meeting, hopefully for your
consideration and approval
of the recommended budget. And
then the fiscal year begins
on July 1. Next slide,
please. So the highlights,
the budget is balanced. There
have been increased power
supply costs compared
to the prior fiscal year. That
primarily is coming from
resource adequacy and renewable
energy. Also, a full year
of service to Grass Valley and
Nevada City are incorporated in
this next year's budget rather
than the six months in the
current fiscal year that
impacts both the revenues and
expenses and then some expense
changes for the CRR. We have
broker fees related to that and
the battery optimization. And
the battery optimization is a
new effort that is connected to
the solar farm known as yellow
pine. But the thing about both
of these expenses is they
actually generate revenue. So
the CRR brokerage fees actually
monetizes the CRRs and the
battery optimization takes into
account prices and cost related
to Caiso, when
to charge the battery and when
to discharge the battery. And
so both of those expenses are
anticipated to generate about
$10 million in revenue
for pioneer and then the growth
of programs. So last year, 1%
of the energy sale revenue was
earmarked for programs and
in this upcoming budget year,
2% has been earmarked
for that. And then the forecast
has also been lowered to more
accurately reflect the activity
for the NIM accounts. And so
that doesn't have a, you know,
neither a good or bad impact
on the budget. It's just a
change that happened
from the prior fiscal year.
Next slide, please. So from a
way broad highlighted summary,
we're looking at about $260
million in revenue, power
expenses, about 210. That
leaves a contribution margin
of almost 49 or 50 million,
which then the operating
expense and debt service comes
out of that,
which is anticipated to be
around 24 million,
which then leaves about 24
million that could be
transferred
into the net position for
Pioneer. Next slide, please.
So inflow and outflow,
we have our almost $260 million
of revenue. No surprise.
Energy sales is the bulk
of that, representing 95%. And
then the CRR and battery
optimization at 4%, that's $10
million. And even though it's
1%, it's our interest earnings
that still is getting pretty
close to $3 million. So 1% is
still a significant number.
And that is really driven
by two things. One is,
as pioneer has moved forward
in meeting its reserve targets,
that's meant that there's more
money that can earn interest
earnings,
but also just the change
in the last three years of how
interest rates have increased.
And so although 1%, I thought
$3 million was still pretty
notable and still should be
mentioned. And then
on our expense side, you have,
as it has been year
in and year out,
power supply costs represent
90% of our expenditures.
Programs this year is a 2%
allocation. Debt service is
also 2%. Consulting service is
3%. Employee compensation,
which includes salaries and
benefits, is 2%. And then
operating expenses,
which is all other types
of things, whether it's rent,
leases, software, variety
of things, rounds that up
to be 1%. Next slide, please.
So the things that have been
changed from the recommended
budget that was discussed
at the May meeting and the
proposed budget, energy sales,
that revenue estimate has been
increased
by a million dollars. The power
supply costs have been
increased by $1.74 million.
The admin division increased
by 200,000. And that's
primarily so that pioneer can
be conjoined a JPA called the
California community Power.
And the benefit
of that is that's a JPA form
from a group
of ccas that allows Pioneer to,
in a cost effective way
with other ccas, purchase clean
energy and reliability
resources. So we see that as a
good tool to have
in our toolbox to help us
contain energy costs. And then
the finance division,
there's an increase of
174,000. And that's related
to asking the board to consider
a 20th pioneer position. And
that's for an information
technology analyst. Next slide,
please. So
in the current year 23-24, we
had 18 funded full time
positions. We're asking for 20
funded full time positions in
24-25, the 19th position we
discussed in more detail
at the last meeting.
But that is for a project
of development manager,
which would focus initially
on biomass,
but wouldn't be limited
to just that effort. And then
the information technology
analysis would be dedicated to
pioneers increasing it demands
and needs,
and also provide more resources
to respond and improve our
cybersecurity. And the results
that we saw from our it audit
that recently concluded. Next
slide, please. So,
from an organizational chart,
this is what Pioneer would look
like, starting
with the green boxes. The green
boxes are what we would all
consider our critical
consultant contracts that we
have that really make it
possible for Pioneer
to service our customers
with the staff that we have.
The blue boxes represents our
existing approved positions
of staff, and then the brown
boxes are the two requested new
positions, the project
development manager and the
information technology analyst.
Next slide, please. So, trying
to keep this short. Moving
to the recommendation,
we are asking for the board
to approve the fiscal year 24
budget,
approving the job descriptions
for the information technology
analyst, the information
technology administrator and
project development manager.
Let me pause there and say,
although we're not asking
for funding for the information
technology administrator,
we wanted
to establish a career path
early on so that there is,
well, career paths just make it
sometimes easier
for getting interest
in recruitment efforts too.
And so, although we don't see
that being something that would
happen really
in the next few years,
we did want
to establish that career path.
And then also approving the
title change of the director
of public affairs,
marketing and programs
to director
of communications,
which there is no change
to the job description,
no change
to the salary range. It's just
truly a change in title. And
then approving the salary
schedule that for,
that reflects the two new
positions, two new funded
positions,
the information technology
analyst,
the project development
manager, but also establishes a
salary range
for the administrator
for information technology.
And you should have received a
revised salary schedule
for that. And the reason for
that is the communication
coordinator,
which was approved. Job
descriptions and salary ranges
were approved a few months ago.
We actually have two people
that are now on staff
with that position.
Unfortunately, that line wasn't
included
in the original agenda packet,
and so that's been added and
revised, but there's no change
with any of those numbers. And
with that, I'd be happy
to answer any questions.
>> Thank you very much. As I'm
trying to choke on my water.
Appreciate the presentation,
Brad. And this, let's open up
for any questions. Are there
questions? Directors? No
questions. Suzanne? No
questions.
>> Quick question.
>> Yes.
>> With the hiring of the new
two positions, or we're
expecting consultant costs
to go down.
>> On the project development
side, I see longer term,
there could be less reliance on
consultants. I don't see that
happening in the next twelve
to 18 months.
>> So these are things that we
need to have done that we just
haven't had done previously.
Essentially then.
>> Well, I think on the project
development side, I think it's
just, it frees up, Sam has
to spend a lot of time.
For instance,
there's a project in Grass
Valley we're looking
at right now where he's having
to spend a good chunk
of his week on that. This
person could free him up
to focus on other areas. So,
and then on the it side,
I think it's more of a,
rather than less reliance on
our consultant. I think the
consultant does become still
part of our business. And now
we've got that
in house expertise, especially
on the cybersecurity side,
that protects our. So I think
it's in the better.
>> Interest
of our great payers
on the project development.
Also, just as a reminder,
director Ring, as I know you
are new on the board, we've
really just ramped up our
programs
in the last two years. And so
even though we're going
into our 6th year, we really
haven't, you know,
we've slowly rolled them out,
and now it's just getting to
the point where one person
can't manage them anymore
because we have increased our
programs.
>> You actually reminded me
of another question. I have.
Do we have a. So right now,
we're in this budget. We are
suggesting from go to go
from 1% of our budget to 2%
of our budget for programs. Do
we have a goal percentage that
we hit? We're looking
to meet, like,
are we expecting to get to 5%
at some point in the future or
there's just whatever we need
to do. Whatever.
>> Well, I think.
>> Sounds right.
>> Well, we look to see where
the programs are going, how
effective they are. I don't see
it going past 2%, though.
>> And it was 2 million last
year. Initially, they had
recommended. The first time we
had our program roll out,
there was a recommendation
for 4 million, and the board
felt that that that was too
aggressive going out
of the box, so we brought it
down to 2 million. Actually,
didn't we do the first year was
like 1 million? Yeah. So we've
just slowly, you know, got
to the 4 million,
which is where they,
the citizens Advisory committee
initially recommended us
to be three years ago. We're
just taking our time trying
to be fiscally, you know,
conservative and ensuring that
we are investing
in the right programs.
>> Thanks.
>> Any other questions or
comments? With that said,
any public comment, Madam
Clerk?
>> There are no comments at
this time.
>> I'll entertain a motion. Is
there a motion to adopt the
recommendations that staff have
made that were on the. You had
the presentation up. Could you
please bring those that slide
back up? Brad or Teresa?
>> One moment,
just so that we're clear.
>> There were 6
recommendations?
>> Yes, 4 recommendations.
>> All right,
is there a motion approved?
>> Staff recommendation.
>> All right, it's been moved
by Director Holmes. Is there a
second?
>> A second.
>> Second by Director
Peterson. Thank you very much.
Any further discussion?
Hearing none. Madam Clerk,
please call a roll.
>>[CALLING ROLL]
>> Thank you. Let the record
show the motion has been
adopted unanimously. I just
want to say that I'm very proud
that we've been able
to adopt a budget with 24.6
million going into reserves. I
think that's very prudent, you
know, and that's also something
that we've been growing
over the years to make sure
that we have that fiscal
solvency, especially
in times of, you know, when we
have critical temperature
changes where we're having
to go out on the open market
and purchase that power
at such a high rate. So very,
very glad to see that. And I
want to continue to ensure that
we put sufficient money. We do
have a policy
on our reserves,
but very happy to see that
24.6 million in the reserves,
as opposed to enhancing
programs even more, got
to be fiscally prudent. So
thank you very much. All right,
next item
on the agenda is the revised,
second amended and restated
JPA.
>> Thank you, Madam Chair. We
do have a short presentation
on this. We have just a few
updates and some action items
out of this as well. So our
general counsel, Patrick, will
cover this.
>> Good afternoon. So this is a
matter that came to us. Skip
to the next slide. This is a
matter that we originally
started, I believe, actually
in October, but November, you
adopted the amendment
to start the amendment process
to amend the JPA. And we did
that basically
for several reasons. One was
to clean up the JPA, because
over the years we've had new
members, and it's kind of,
with five amendments,
it got kind of confusing,
clunky to know exactly what's
in the JPA. So we did a
restated one
with restating all the sections
of the JPA. And the second
thing was to deal
with the issue
of the future amendments
to the JPA. Right now,
the JPA requires that
for any amendment,
no matter how small,
it requires a vote of each
of the member agencies
by resolution. So you need
to take it back to your
governing body and get a vote
of your governing body,
and we need to get, right now,
ten. We have ten members. So
the idea was to streamline it
and just have the most
important items actually have
to go back to a vote
of the member agencies,
and then the rest
of the items could be amended
by the board
by a two thirds vote. So that
was what we were trying to do
in the agreement. It would
still require that our powers,
our section four powers,
would have to go back
to the member agencies. We
cannot change what we actually
do or how we do it
in that respect. It also
required that anytime we
expanded, added a new member,
that it would still have
to be approved by all ten
members or however many there
are at the time. So we did that
in November, pursuant
to our JPA, it requires a 30
day notice going out
to all the member agencies. We
did that then in January and go
to the next slide. We did
approve the amended and
restated second amendment
to the JPA, and
from there we sent it to each
of the member agencies
for approval via resolution.
Eight approved it,
but two member entities,
the town of Loomis and the city
of Rockland, had some issues
with it. So that is why we are
back here at this time,
because we are not able
to get all ten signatures. Go
to the next slide. The city
of Rockland was okay
with all the changes,
except they wanted
to amend basically section 19
to include,
which is the amendment process
to include that. Also, section
14 would be the same in terms
of if section 14 deals
with the withdrawal
of members, it allows a member
to withdraw with notice, and
they also must do an accounting
and pay up
on anything that they may be
owed by the. By maybe owed
to pioneer. They are concerned
that section 14 language could
be changed by the board that
somehow would change that
process and would not give them
the power, I think,
in the future to unilaterally
withdraw if they wanted to,
and that they did not want
to see that. So we have added
section 14A and B to the
proposed restated JPA that's
been before you today to
address the issue that the city
of Rockland had. So section 14A
and B, if we wanted
to change that language
about the withdrawal process,
would have to go back to each
of the member agencies
at that time.
>> I just want to clarify, too,
because this was when we
initially were having this
discussion,
and we did have the opportunity
to meet with member director
Janda on this issue.
Initially, there was some
concern, and they said that,
well, maybe if someone wanted
to withdraw from the JPA,
then we should all have
to vote on that.
But then when we brought it to
their attention that that's not
in anyone's best interest,
to require all of us to have to
approve whether or not someone
withdraw that they quickly
understood and simply said,
okay, well, we're fine
with that.
But if this board wants
to make a change
to that section that deals
with it, then any change
to that section
of the JPA would go back
to all of us to ratify it. So
if we wanted
to change the process by which
someone would withdraw, then
that would require a full vote
by the body. So it's just a
clarifying change. And Don and
I have been able to talk
about it and are fine
with that request.
>> Although we don't have
Rockland here today,
they have seen this change
in our agreement with it.
>> Just wanted to clarify that
because it is a little
complicated and just to kind
of did do that.
>> There's history and how they
handle it. The city of
Rockland did meet and have a
council meeting,
and so they did discuss it
in open session. All right.
The other one was the town of
Loomis, who have not taken it
back to the. Back
to their town council
at this point.
But I've had discussions with
their. I guess he's called a
town attorney, city attorney,
essentially, Jeff Mitchell.
And I know that Don and the
chair has also had
conversations with the city
of Loomis about what they were
looking for. Mister Mitchell
provided a list of three
different options that he would
like to have seen. The first
option was to. To basically
include a significant number,
like ten or twelve of the
sections that would require a
vote
of all the member agencies. We
were, at least I was
of the opinion if we did that,
we might as well not even do it
because basically any change
would have to go back
to the.
>> I'm going to just interrupt.
I'm sorry. I think
since we did have that meeting
with Director Ring, the city
manager, maybe just to. If you
could just present the
recommendation that came out of
that meeting versus rehashing,
because that's not
before us today. Director Ring
is now proposing this amendment
that's up here. Because
otherwise it might make things
confusing and that's not
on the table. I just want
to cut out that their second
suggestion was to get 60 days
notice instead of the 30 days
notice and we did meet
with them. They're agreeable
to 45 days notice. And that is
what we've got
in the proposal today. So those
are the two main changes
in the proposal pursuant
to the discussions with
Rockland and the town of
Loomis. Next slide. And then
the last change we are making
on our own is as part of the
performance evaluation and the
employment with Mister
Eckerd, we changed his title
from executive director to
chief executive director
officer officer. I'm sorry.
And so we just needed
to clarify the JPA
to be his title. His duties are
exactly the same. It's just a
change in title, but his title
will now be officially chief
executive officer
in the future instead
of executive chairman director.
Next slide. So the
recommendation is to adopt the
resolution amending the
revised, second,
amended and restated JPA
with those changes I just laid
out by each
of the member agencies,
as well as the change
in title. We already gave the
30 day notice. This is still
part of the whole process that
we've gone through,
so there's not a need
to resubmit it for another 30
days notice to each
of the member agencies. Once we
adopt it, we will send it out
to each of the member agencies
for ratification via resolution
of the revised, second,
amended and restated JPA.
Once, hopefully we get all ten
to be in agreement,
then it can be executed
by the chair,
and then we will be
under the new revised, second,
amended and restated JPA. The
last JPA, essentially,
that we sent out is null and
void because we cannot get the
required signatures. I think
that's it. Is that one more
slide? Thank you. So does
anybody have any questions?
>> Thank you very much.
To summarize very quickly,
we've all seen the amendments
except for these two, and most
of our jurisdictions have
already voted
on the initial amendments.
We're going to have
to go back and ask
for their vote again, because
we now have two additional
amendments,
should this board vote
to include those in the round
of amendments. So, again, the
first one is just stating that
if the board were
to make a change
to the section that deals
with the process
of withdrawing,
that that would have to go
before all of us. And the
second would be changing the
number of days notice
for change from 30 days to 45
days. And again, Don and I had
the opportunity to meet with
Director Ring and his city
manager to talk
about that and felt that 45
days was reasonable. Anything
longer makes it difficult
for us
in the immediate future,
given that we're expanding,
and so we don't want
to push that off because we
only meet once a month. I am
in support
of those two recommendations,
and I'd like to open this up.
If there are any questions or
comments.
>> I just want to point out,
I think it's reasonable for
Loomis, too. Loomis only meets
once a month, too,
and that was part
of their issue with the 30
days.
>> I have a clarification
question. I don't know if it's
my brain or not. Back
on the first slide. Way back.
I'm just trying to understand
something that wasn't making
sense to me right there. So
administrative.
Let's see. Okay, so section
19, advance notice
to each member agency
before board votes. Two thirds
vote by the pioneer board
to amend the JPA.
>> Correct.
>> But then it says
underneath must be approved
by resolution, by every member
so does that mean that it takes
two thirds of this board
to then send it
to every member
to approve it?
>> Yeah. And then we need all
ten.
>> So it still goes back
to every member
for every amendment.
>> Well, that's why we wanted
to streamline it. Yeah, that's
why we're streaming. Yes. So
we're streamlining that process
because every single.
>> Yeah, that's the current
process. The new process will
give the 45 days I was stuck
on.
>> No wonder we're changing.
>> That's exactly right because
it's a lot of work.
>> Expand the notice. And the
board can enact except
for those few exceptions.
>> Yes.
>> In section 414 and add a new
member.
>> Thank you for that.
>> Can I make one comment?
>> Sure.
>> When this first all came
to my attention, mostly it was
our legal counsel who looked
at it, and so he was the one
who brought his concerns to me
with it, which is then I became
concerned. And so,
so I would just like to advise
that you all send it back
to your legal counsel to look
at before you consider a new
adoption but there's something
else I can say.
>> On that point,
one thing I've learned,
of course, I'm not going to be
your general counsel here
shortly, but one thing I've
learned is I would contact,
because I know most
of the city attorneys, so I
would contact and make sure
they're on board too,
at the beginning
of the process.
>> And the other comment I want
to make is that we are, this is
greatly expanding the powers
and the role of this board.
This does. And I think that as
we grow,
that is when we have a giant
board, it kind
of reduces the risk
of just a couple of bad actors
in the board acting. So I think
as we get bigger,
this is not a terrible idea,
which.
>> We're actually planning
to do. We've got several
expansions that are.
>> I just want us all
to be aware of what we're
actually doing here. And so I'm
sure you are sort
of state it. Yeah. But, yeah,
as we get bigger, I think it's
very difficult because we'll
have to go back to 1520
different organizations.
>> And get those and then they
don't get on the agenda. You
missed an agenda and then
you're 6 months
down the road trying to get all
those signatures done. Little
experience with that one.
>> Any other questions or
comments on this?
>> I would just make one more
comment would be upon approval.
Then staff will work
with your city managers
over the summer, and I would
hope then we could maybe wrap
this up by September.
>> Can I have a motion? Can we
put those back up, please,
Madam Clerk?
I'd like to just keep you
on your toes, Teresa.
>> There we go. All right,
so do I have a recommendation?
I mean, do I have a motion?
>> I'll move that we support
staff's recommendations.
>> I'll second.
>> It's been moved and
seconded. Any further
discussion? Any public comment,
Madam clerk?
>> There are no comments
at this time.
>> Thank you very much.
Appreciate that. Okay, no
further discussion. Madam
Clerk, please call a roll on
the motion.
>>[CALLING ROLL]
>> Let the record show the
motion has been adopted
unanimously. Thank you very
much. And look for for the JPA
on your next upcoming agenda
for each of you then. So thank
you so much. All right,
so moving right along,
we have a presentation.
>> Thank you, Chair. Good
afternoon, fellow directors.
So you're done
with the action items? You can
relax. I thought we maybe.
Thought we'd do something a
little different. We've been
making a lot of decisions over
the last six months and maybe
take a break and hear
from a guest speaker
with a lot of knowledge on
issues that we all care about.
So I had the pleasure of
meeting our guest speaker last
month at California municipal
rates Symposium that was hosted
by Smud. And after 8 hours
of death by PowerPoint, our
guest speaker then presented.
And his candor was both
informative and really
entertaining. And I was hoping
that he could share that
with us today. And he has. I've
included his bio
in the staff report. But just
to cover a few highlights,
Doctor Ahmad Fareki has 45
years of consulting, teaching
and research experience and
rate design, load flexibility,
energy efficiency, demand
response, distributed energy
resources, demand forecasting,
decarbonization and
electrification. He has worked
for over 150 clients on five
continents and has testified or
appeared nearly 100 times
before regulatory bodies,
governments,
and legislative councils
on six continents. Doctor
Farooqi has taught economics
at San Jose State, UC Davis and
the University of Karachi, and
delivered guest lectures at
Carnegie Mellon, Harvard,
Idaho, MIT, New York,
northwestern, Rutgers, San
Francisco, Stanford, and UC
Berkeley. Really pleased to
have our guest speaker today.
And Doctor Frutkin, the floor
is yours.
>> Good to see you, all of you.
I hope I can be somewhat
interesting. I know it's just
post lunch. Some of the stupor
is probably beginning to set
in. I'm pretty certain this
topic is going to wake us all
up because it is a disturbing
reality of today,
the high cost of electricity.
And we hear a lot
about electrification is the
way to go. We hear
about climate change, we hear
about affordability, and
of course, we are in on here
in California. So the golden
state, right? We always lead
the country, it is said. And so
what I want
to do is explore some of those
assumptions that are widely
held and perhaps provide some
thoughts for you
to comment upon. What I will do
is. So I should plan
on talking for what, about 40
minutes or so, something
like that,
not seeing a clock. So I will
occasionally, one
of us will wait. We'll bring
the cane out. I
will need a hint or two because
I've been known to speak
for longer than needed. And
it's not just my wife who has
that view. All right,
so I think you're going
to put up the first slide.
There we go. And if you could
put that in full screen mode.
And there it is. Thank you so
much. Okay, so I was thinking
of what title to give it. So
the title I came up
with was how the Golden State
lost its way on the road
to electrification,
and happy you invited me
to present
on the summer solstice, which
makes it exceptionally unique
and memorable. We planned it
that way. I was thinking hard,
how did it come about
to be the 20 June? All right,
so as I mentioned,
electrification is a high
priority for the state. Two
technologies we are told hold
the keys
to electrifying homes,
heat pumps for maintaining a
comfortable temperature
at home both in the summer and
in the winter. What a
remarkable device. I first
heard of it when I was early
in my career in 1979. I said a
heat pump that provides cooling
I was working at the Electric
Power Research Institute, and
they said, yeah,
it takes the heat
from the outside and puts it
into your house. I said, in the
winter there is heat outside. I
said, yes, there is. And
in the summer, it does it
in reverse. It takes the heat
from inside. So that was 1979.
This is 2000. What, 24. Still a
novelty for most people. And
the average customer has no
clue what a heat pump is.
Everyone knows what an air
conditioner is.
But the state says,
if you're going to save
ourselves both here and abroad,
by which I mean
in the afterlife,
we need a heat pump. Do any of
you currently have a heat pump?
You do? Okay, well, the rest
of us don't know. That is so
true. That is so true. Some
of us might. So you pretty much
summed it up. I mean,
the reality is very, very few
people have a heat pump today.
But the state, as part
of the policy that Governor
Newsom has laid out,
going back to Jerry Brown and
others, is
to manage climate change. And
that's a key technology. It's
very expensive to buy,
very expensive to install.
Sometimes it needs a panel
upgrade,
and it's even more expensive to
operate unless you have solar
or unless you have a really low
rate
from some other utility than
Pacific Gas and electric
company, which I will focus
on because it serves 5 million
customers in the northern part
of the state, and those 5
million represent roughly,
what, 18 million people. So
besides heat pumps, the other
technology that is often
mentioned is EV's. And I saw a
lot of superchargers in this
area. I have one myself. You
have two, you told us so.
Certainly EV's are catching on
in California, but not in much
of the country.
But those two need
to be pushed hard
for electrification. Other
technologies include heat pumps
of water heating, induction
stoves, clothes dryers,
and electric spas
for those who indulge
in that luxury. Okay.
To accelerate electrification,
the state needs
to make electricity competitive
with natural gas,
which is the primary
alternative fuel, and
with gasoline
for transportation, that means
lowering the capital cost
of electric equipment,
for example, buying an electric
car or installing a heat pump.
Lower that cost, and
of course, lower the cost
of electricity for the
customers because it is not
just a capital cost decision.
These things last
for a while, and so it has to,
it has to save you money.
Otherwise, why would you do it?
Now there are some who will do
it because they want
to be green or because they
want to experiment or because
they are
in the energy sphere,
or they are physicists
by training with a lot
in the bank balance. So we have
a challenge because this state
is very expensive, labor
expensive,
the equipment is expensive. So
what is the state trying
to do? And you probably know
this. I'm just summarizing it.
The state, along
with the federal government, is
providing various financial
incentives in the form
of rebates, tax rebates that
lower the purchase and
installation cost of electric
technologies and eues. That's
great. I support it. However,
it is also doing something that
makes electrification
unaffordable, repeatedly
raising rates and pushing up
electric bills
to the breaking point. So how
do those two things coexist?
That's what we would. That's
correct. And it's a mystery
to me as a citizen
of the state, how a state so
smart and so big and so well
known to possibly be the
world's fifth largest economy
for a separate country,
how a state of this size
of nearly 40 million people can
be so down. I don't have any
easy answers. I will just raise
the questions and you will
provide perhaps some
of the answers because I'm
at a loss. I should mention,
I have lived in this state
since 1974. I came as a grad
student at UC Davis, liked it
so much I have stayed.
Unfortunately for us, for all
of us, both
in the room and not
in the room. California took
two wrong turns on the road
to electrification. Wrong turn
number one. It failed to rein
in rising electric rates,
which rose at a much faster
rate than charges electric
charges in the rest of the
country and way faster than the
rate of inflation,
unchecked rises in electric
rates that the legislature did
nothing to rein in,
that the governor did nothing
to rein in, that the public
Utilities Commission did
everything to approve and push
on to customers. It's a story
of corruption and greed. But I
don't have a movie yet. I think
there's a script here. Okay.
So it put a large share. Now,
whenever some disaster happens,
you have to blame somebody.
You have to point your finger
at somebody other than
yourself. So they put a large
share of the blame
on customers with solar panels
and replace net energy metering
with a net billing tariff. And
I will dive
into that shortly. And I should
tell you in full disclosure,
I am one of those people who
has solar panels. I live
in the East Bay, and my bills
were just rising and rising.
So after five years
of hesitation, I put solar.
And as I look back, I think
that's the best thing I've ever
done probably
in my entire life, to rein
in my energy bills. In 2016, I
did a massive whole house
energy upgrade short
of heat pumps. But I did
everything else the bills only
went down 25%. Then I put
in solar. And over the last,
since 2019, my bills finally
have gone down 85%. And
of course, then they're saying,
I am the reason why everyone's
rates are higher. I and 1.7
million other customers
in the state,
representing nearly 5 million
customers, are the reason why
rates are really high. Is not
the utilities, it is not the
PoC, it is not the governor,
it is not the legislature, it
is those beasts who have put
solar panels, ugly as they are,
on their roofs. Okay, so wrong
turn number two. This is more
recent. So the solar panel
debacle took place on April 15
of last year,
called net billing tariff. And
then they said, oh,
but that's only
for new customers. That's
for new solar customers. What
do we do to get at the existing
solar customers? And everyone
else was thrown
into the mix as well. We do the
shell game between fixed and
variable charges. Now, who ever
thought a shell game could be
so exciting
to be front page news in story
after story in the LA Times,
in the Sacramento Bee, in the
San Francisco Chronicle, even
in the Wall Street Journal, et
cetera, et cetera. Well, it
turned out to be that the state
didn't know,
but it touched a nerve. And the
idea was called income
graduated fixed charge, IGFC.
Now, you can easily change the
c to a u at the end,
and that's what it's all about.
Now, to make the change sound
equitable, it decided to make
the fixed charges a function
of income. So that was very
clever. It was politically
motivated because the professor
who first put it out, he didn't
have income graduation built
into it. And of course,
consumer advocates would have
opposed it. Like, there is a
group called turn, some
of you may have heard of it.
Turn has opposed fixed charges
of $3 a month, of $10 a month.
Legislature approved dollar ten
a month. The PUC still couldn't
even put in a three dollar
fixed charge because turn was
the voice that was always
negative. So when this idea was
floated
with the fixed charges, I
thought, this will die
immediately because turn would
opposed it. Well, what I forgot
was that the idea,
as originally proposed,
was going to be modified
to make it palatable to turn.
And we'll get into that
in our discussion. So this is a
story of complex political
maneuvers and intrigues,
and I really think Matt Damon
would be well adopted to, I
don't know what role he would
play. Okay.
In the late 1980s,
California's rates began
to rise above the US average.
In 1979, they were
about the same. That's the year
my career began. They were
about the same. And ever
since then,
they have diverged. And so I
retired two years ago. And
somebody said to me, so does it
now mean they will start coming
down? People, you know,
you have
to admire their bluntness. So
the US is the blue line and
California. And by the way,
California here includes all
of California, not just PG and
e. So this is much lower than
what you would see if it was
just PG and E. And I'll show
you shortly the details
of PG and E, much of which you
probably have seen. Okay, so
now we enter into the halls
of power. It used to be at 77
Beale street. I'm sure some
of you have seen that building.
And the commission is located
at 505 van Ness. So
between those two, a lot
of underground lines. And
that's how decisions were made.
It was known as the revolving
door policy between
commissioners and utility
executives. So they serve 5.5
million customers
in the northern part
of the state. With the consent
of the commission, they have
more than doubled their
electric rates
over the past decade,
exceeding the increases
of any other utility
on the planet. And I did a lot
of consulting around the globe.
I've shared this news as it
unfolds. And utilities
everywhere are as shocked as
are people living
in this state. How can they get
away with it,
is what everyone says.
Especially a utility that has
had a series
of well publicized disasters.
The PUC keeps
on approving them. So
for those of us who drive an EV
and who live
in the pg and e service area,
a rate that appeals
to many is called EV2A.
That's not a name that you
would see
for any other product. But
for our industry, where jargon
abounds, that is the name
of the rate. EV2A. The
off peak rate in this is thirty
five cents a kilowatt hour
today is double what it was
just five years ago when I
bought my car. It's doubled
in five years. At $0.35, it
exceeds the peak rate
of most utilities
around the country. This is the
lowest and it exceeds their
highest. So this is how the
world was turned upside down.
Nobody has taken them
to task. Nobody has calibrated
their numbers against others
because they say,
we are unique and different.
You could say this is PG E's
exceptionalism or the PUC's
exceptionalism. California sets
the rules for everyone else.
And a few others are saying,
hey, if California can charge
that, maybe I should raise my
rates too. They're giving the
wrong incentives to utilities
and commissions elsewhere. How
much would you save if you
bought a Tesla, if you're
in the market for a Tesla
today, or an EV that gets,
let's say, 4 miles/kw hour,
compare that to an internal
combustion engine vehicle,
otherwise known as a gasoline
car.
But that's the jargon they use,
that gets 45 miles per gallon,
you're not going
to save a whole lot. Savings
are disappearing very fast.
Five years ago,
I would have saved $1,000 a
year on my driving cost. Now
I'm only saving $500 because
they have doubled the rates.
Gasoline prices,
as you probably know,
have not doubled. They have not
moved. They've actually come
down. They have oscillated and
moved around. I have another
reading. Thank you. Pleasure.
Pleasure. So if you compare
them with smuds rates. Anyone
here a smud customer? I am.
Okay, so this is from Smud's
website. A smud customer using
750 kilowatt hours a month
would pay $135 for that much
electricity. A pg and e
customer just located a couple
of miles away
across the road,
in some cases, would pay $352.
Now, if that's not highway
robbery, then what is? How can
they get away with it? It's
exactly the same electricity
from a physics and engineering
perspective. There's the same
air conditioning,
the same electric car charging,
same light bulb,
but it costs. So if you had a
choice
between two retail stores,
let's say one was Safeway, the
other was Costco, where would
you go? Well, the problem is we
can't switch suppliers. We're
stuck. That's how they're able
to get away with it. It's the
monopoly. But it's supposed
to be a regulated monopoly. It
has turned into an unregulated
monopoly because
of the commission's largess.
This is just showing over the
five years how the peak, mid
peak, and
off peak prices have changed.
And this is as of the end
of last year, when
on the right bar, which says
2024, the very right bar says
$0.34. That's gone up to 35.
And
by the time this year is over,
I suspect the 35 will be 37 or
38. Because it's a treadmill.
It's giving us palpitations
because the treadmill is very
fast. Now, this graph is truly
amazing. How could they get
away with this? No other
utility anywhere else has had
this rate
of rapid acceleration
of rates. And according
to some analysts,
pg and e bills
on a monthly basis may rise
by another. They already have
risen by $56 by the end of
April, but by the year end,
they could be higher
by another $100 per month,
not per year. And currently,
the average pg and e rate is
forty six cents per kilowatt
hour. It varies by rate,
type and how much you use,
etcetera, etcetera.
But the average
for all pg and e's 5 million
customers is $0.46. There's
three times higher than the us
average. Isn't that shocking?
What's funny
for me is people are just used
to it. Nobody says anything.
They complain. They say plenty.
They say plenty and you say
plenty. It's almost like. It's
almost
like if you had said nothing,
the same would have been true.
Maybe it could have been a
little higher. I think our big
problem comes down the fact
that CPUC is appointed
by friends and appointed
by the governor. Honestly, it's
just his friends. Yeah. The
CPUC is supposed to be the
California Public Utilities
Commission. But it has turned
into something else. And I have
a few other interpretations
that I can share some other
time. So what you have there,
you know, they have. They have
lost their anchor. And believe
me,
they couldn't be doing this
without the governor approving
it. And look
at the connections between our
current governor and pg and e,
and the history that goes back
there, too. They're much more
than skin deep,
one might say. I mean,
and we were going
to break up pg and e, right?
That's what the governor
himself was saying. We'd have
to look
at public ownership early on.
And then all is forgotten,
all is forgiven. God is most
kind. So all of that noise
in the media,
they just ride it out. And I
don't know how long this will
continue, but it's a very,
very disturbing connection that
at every social gathering I go
to, including weddings and
Carmel, or parties
near my house,
people just start coming
to me and complaining
about PG and E. Even though I
don't work for PG and E,
I am not PG and E. Somehow,
like a magnet, I draw those
filings and all we do is we
agree. And then they look
at me and they say,
so you're not doing anything?
Well, I said,
I'm doing whatever I can, but
it is a very stiff competition.
And then some come
to me and says, you're retired,
why are you not relaxing? I
said, how can I relax? As a
customer, as a public citizen,
I have to speak up. So it's
keeping me busy. Okay, so
along with the two other
investor owned utilities
in the state,
PG and E has blamed all
of those high rates
on the surge
in rooftop solar installations.
So why would anyone install
solar? It's because the rates
are high. And the bills are
high, and they're saying, oh,
now that you have installed
solar. That's why the cause and
effect have been very cleverly
intertwined. It's very
disingenuous. Right? Very
disingenuous, since
California's high rates predate
the arrival of solar panels
by more than two decades. And
I'll show you some graphs.
Californians installed solar
to cope with the skyrocketing
rates and not the other way
around. And furthermore,
if they want electrification,
solar customers are more likely
to go with heat pumps and
electric vehicles because they
can afford them. When I looked
at heat pumps twice, once in
2016 for my space heating and
air conditioning,
and then two years ago
for my water heating, but both
times the contractors would say
to me, unless you have solar,
it won't make much sense. And
then two years ago,
I had solar in the heat pump.
The water heater broke and I
was at Lowe's asking which one
should I pick? And he said,
you should pick this one. I
said, well, how
about that heat pump,
water heater? And he looked
at me and he said, oh,
go right ahead. If you want
your bills to go
through the roof,
go right ahead. So the
contractor community, and I'm
in touch with several of them
through professional channels
as well. It's a very difficult
sell. I'm sure you had
to think it through quite a bit
right before. And I have a
couple of friends who have
installed heat pumps. One spent
$44,000. I'm still trying
to figure out how it got
to be that high. I mean,
that sounds really high to me.
But he has promised me he will
give me an explanation. And
avoiding seeing me
for a few weeks now,
who knows what happened there.
Okay, so this is the growth of
solar panels that didn't really
start to grow until almost 20
years after the energy crisis.
I'm sorry,
did you say his bill was
44,000? No, his. Not his
electric bill. The cost
of installing. I mean, he also
did a home energy upgrade. I
think he didn't have air
conditioning to begin with,
so duct work, etcetera,
I think there was a lot
of infrastructure work, but I
think his bill is probably,
I would guess, between 100 and
$200. Okay. All right,
so what did the utilities do?
They decided to play
off one group of customers
against the other group
of customers. They argued that
there was a cost shift because
solar customers used so much
less power, power from the grid
than the average customer, so
they don't pay their fair share
of cost, and therefore,
the rest of the cost has
to be recovered
from everyone else. And then
they said only the wealthy
people installed. Solar is so
expensive. And so really, this
is a cost shift that is the
opposite of what Robin Hood
would be doing. This is reverse
robinhood. That was the phrase
that I ran into
in other states. So
like a rogue. A rogue, kind
of a cost shift. They also
argued that rooftop solar cost
far more than large scale
solar, and therefore,
we should focus just
on large scale solar farms way
out there, and the transmission
lines would bring the power.
Now, why would they do that?
Well, because they make money.
They get a profit. It's very
transparent, but it's amazing
how gullible the general
population is. Obviously, this
is not their specialty. This is
not what they think about. So
they managed to convince
at least a good chunk of the
legislators that large scale
solar is the way to go. People
even tell me some, well, known
academics who I will not name
that. Oh, it only costs five or
six cents per kilowatt hour
to have large scale solar,
whereas the solar you have put
in is
like fifteen cents. I said,
okay, why don't you start
selling me that power
at four or five cents? And then
there was no need for me
to put in solar. So why does it
cost four to five and I pay you
45? I mean, what's going
on here? That's the part of the
equation they delete and then
they immediately leave the room
or change the topic. They know
it. They know it. I mean, it's
not that they're that unable
to grasp common sense. So what
they have done now,
there was a podcast by one of
the professors just a few weeks
ago that another professor
friend of his from Princeton
put up on twitter. I listened
to it much as I didn't want to,
just to see what was the new
manufacturing of lies now. And
basically they said, oh, it's
inequitable because the poor
are subsidizing the rich. And
second, it is inefficient,
it costs more. So it is both
inefficient and inequitable.
How bad can it possibly be?
And you still want to do it?
It's like a snake
in the grass. Okay, so let's
just briefly examine this cost
shift. And I want to show
something very basic that they
have omitted in their math.
So, look at the middle bar,
is the average customer's usage
from PG and E. As of today,
540 kilowatt hours per month.
And then look
at the left bar, 980. Solar
customers,
before they installed solar,
used a lot more power than the
average customer. They had high
bills, that's why they put
in solar. And that goes back
years and years and decades. I
have my data,
I don't have data on other
people's pre solar use. Every
utility has it,
but I can't get it. So I just
use my own data. So my pre
solar data,
even though I have lived
in the house since 1989 in
Danville, I don't have that
digital data,
so I have it only from 2008
onwards. But the house hasn't
changed much. It's the same
house. So 980 for the years
from zero eight to 19 was my
kilowatt hour usage, almost
twice as much as the average
person. So I was paying twice
as much for the grid. And now,
of course, I'm paying 108.
That's the average
over the last few years,
a lot less. So what they do is
they don't show this bar
on the left,
they just show this. And they
say, you're robbing the poor
to pay the rich kind
of argument. Well, but for many
years it was the other way. So
if you're going
to compute my cost shift, look
at the whole history,
the life cycle of me and my
data is just one customer,
there are many others. Just add
it all up and this is what you
get then. So I added up the
life cycle cost shift and my
lifetime overusage is that
number, 37,397 kilowatt hours.
I have paid more
for the grid,
as have most solar customers,
when you look
at the longer time horizon. So
saying that we use less and
therefore are creating a cost
shift is only half
of the story. It's very clever.
And I've raised this and
they're saying, we don't
understand what you're saying.
You're speaking Latin and
Greek now, which is one way
to just say, hey,
just go away. Unfortunately,
the utilities and their
consultants convinced the CPUC
that net energy metering should
be killed because it was
subsidizing the rich
at the expense of the poor,
and it should be replaced
with net billing. So what they
did was they said, we're going
to cut your compensation
for exports by 75%, which is
huge, because export
compensation accounts for half
of the savings that a solar
customer gets. So you cut half
of that by 75%,
you have really made it
for new solar customers. It
doesn't make much sense. It's
so expensive now. Only the
Veldi will now put in solar,
and they are,
they are putting it in. But
solar installations have
dropped by 80% in the six
months following this
development
of the net billing tariff.
They have doubled the payback
period. So the solar industry
is in a crisis. But it's not
just the industry that is
in a crisis, it is the
customers who no longer have
that option available
to them,
unless they're willing to put
in batteries. And batteries are
still expensive,
and you would have to put
in two or three batteries
really
to do what they're asking you
to do. I have one battery, and
actually, interestingly enough,
I put it in just because I'm
in this business that wanted
to see what the battery does.
And I have the time
of use rate that I showed you,
the three period rate I use the
battery for arbitrage against
during the high peak period
price. I don't buy power
from PG and e. Solar panels are
not generating much because the
sun's going down. It's
from four to 09:00 p.m. the
battery is fully charged and it
begins to supply the house
with power. That works till
about 07:00 p.m.
on hot summer days like this.
But on cool spring days or
winter days,
the battery powers the house
until almost midnight. So the
battery, for me,
was an experiment. Most people
didn't put in batteries
until this rule change
occurred. But what I didn't
know what the battery can do,
which proved
to be the real benefit, was
during outages. And I've had
more than two dozen outages
since June of 2021, even though
I live in an area where
underground wiring is the norm.
And even though those days were
mild weather days,
they were not hot days
like today,
they were not psps days.
Underground wiring is
in terrible shape and keeps
on having mechanical problems.
After 50 years,
if you don't maintain a car,
your car probably would have
died 30 years prior. Well, the
wiring has survived,
but now it's beginning
to die. And so the battery
kicks
in and keeps the lights going.
It keeps the refrigerators
going. The food is safe,
of course. The air conditioner
cannot run,
and I can't charge my car,
but the basic necessities. So
the batteries are definitely a
good option,
but they're still expensive,
so that's what the PUC did.
They had a very smug look
on their face. They said,
everyone's now going
to buy solar and put batteries,
and that'd be good
for the grid. Well, 80% sales
drop tells us that not everyone
bought that story. So expensive
to install it. So why would
they do something like this
in a state that's supposed to
promote electrification and
renewable energy? Actually,
what was amazing
to me is this was met
with a lot of opposition
by many well known people,
including from Hollywood. The
guy who played the incredible
Hulk, I forget his name. He was
active on Twitter
on this issue. And
Schwarzenegger wrote an op ed
in the New York Times
lambasting this proposal. The
PUC modified certain elements
of it, but still approved it
unanimously. Now, when an
agency takes decisions
unanimously,
and that was the first of many
decisions they would make, all
of their rate increases have
been approved unanimously. So
then you begin to suspect that
there is something suspicious
here,
that they are following orders.
It's
like a totalitarian state.
That's very unfortunate,
because it used to not be this
way four decades ago. Okay, so
that was the first wrong turn.
Now comes the second wrong
turn. The shell game between
fixed and variable charges. So
we did not have a fixed charge
for two
of these three utilities. It
was literally zero. And the
third one, SCE, had a fixed
charge
of mean almost nominal, because
tern kept opposing them. The
POC listening
to turn and others said, okay,
no fixed charge. New law is
passed, Ab 205, and we'll come
more into that. And what it did
was it said, you're going
to lower the energy charge,
the variable charge, so that
electricity will become more
affordable and you will tempt
people. Oh, the price just
dropped. So you can buy more
food or more gasoline or more
electricity. Now is a sale.
But the sale had a catch. You
had to pay for the sale. Have
you ever heard of that? So you
had to pay a fixed charge,
the subscription fee,
to be eligible
to get the discount. And that's
how it was sold and marketed.
Why was the fixed charge
introduced? Why was there a
need to do that? Why was it not
a genuine sale? Because the
utilities would have lost
revenue. But God forbid, how
can you deny them the food that
they subsist on,
which is money
from customers? And so they had
to bring in the fixed charge.
It was called revenue neutral,
which is jargon for saying the
utility will always get the
money it needs, regardless
of what the red design is. It
is like the law
of conservation of energy
in physics, which is the law
of conservation of revenue
in regulation. We knew it was
coming, and sure enough, it
came,
but turn would have opposed it.
They decided to make the fixed
charge a function of income.
And that was an epiphany that I
don't know
at what point occurred, but
when I first saw that paper
come out
from the academics pushing
for this,
I thought it was going to die.
But let me do just some
backdrop here. So I personally
support fixed charges,
but they should be based
on some reasonable concept
of metering cost, billing cost,
and customer care. That's how
it is done throughout the
United States. And I actually
was involved
in supporting a fixed charge
of $3 and $10 for these three
investor owned utilities. I was
their expert witness.
But the PUC would think of
approving it and then turn
would push back so it wouldn't
get approved. And finally
thought,
it'll approve just a dollar
three, fixed charge. Well, the
general counsel of the PUC said
is unconstitutional. I said,
what do you mean it's
unconstitutional? The
constitution gets
into such details
on electric rates. And
apparently it did. I never
checked it,
but they were required to go
to the legislature to get them
to change it. So they went and
they invited me. I went out
to Fresno. I'm sitting there
at a community college in
Fresno, and right next
to me is the head
of the energy division
of the PUC. At the time we had
a long debate. 100 customers
were there. They lined up.
They had their views,
they had their objectives,
but it was a caucus
of the state assembly,
and they passed it. And then
the full assembly approved it,
$10 a month fixed charge.
But as I said,
the POC still wouldn't approve
it,
because ultimately the PUC has
to approve it. Even if the law
says you can do it, it doesn't
become reality unless the PUC
does it,
because turn kept objecting.
Fast forward to 2017. The PUC
held a workshop on rate design.
A suggestion was made
to drop energy prices down
to the marginal cost
of energy,
which would be ten or $0.11,
economists say. And you've
heard this, I'm sure, from 100
other economists,
that the most efficient way
to allocate scarce resources
to meet the infinite needs
of human beings is
to price everything
at marginal cost. So the same
proposal was made here. Well,
but the price
around that time was around
thirty five cents a kilowatt
hour. And if you drop it down
to ten, there would be a
massive revenue deficiency.
They would go bankrupt. And so
they said,
what we need is a fixed charge.
And I was on a panel where the
fixed charge was debated,
and I said, this fixed charge
would be really high because
you're looking
at the difference between
$0.30, let's say, and $0.10.
So there's a 20 cent revenue
deficiency. The fixed charge
would be enormous. The workshop
ended inconclusively. And then
2019. The POC invited me
to come and talk about
electrification and rate
design. So I went,
I thought we were going
to talk
about electric cars. I mean,
that's what I thought was the
issue, because there,
that person who invited me,
who was still at the PUC, was
with a conference
on electrification of cars
with me in Los Angeles two
months ago. So I go
in and suddenly, lo and behold,
it turns out they want me
to chat about heat pumps. And I
was not prepared for that. So I
said, do you have anything I
can react to? And they said,
no, you're the expert. You tell
us. I said, you know,
I have done no thinking
on this. Well, just start
talking. Okay. So I said,
lower electric rates. They're
too expensive. They said,
we can't do it. I said,
raise gas rates,
we can't do it. I said,
provide rebates
on heat pumps. Oh, that's not
for us to do. Okay, put a tax
on gas water heaters and gas
furnaces. We can't do taxes.
Ban the installation
of gas equipment. Fine. And
arrested contractors who
installed gas equipment they
started laughing. I said,
you asked me to brainstorm, and
that's all I'm coming up with.
They said, we can't do most
of what you're saying. Thank
them. Left the room. I'd taken
two junior people with me
for the excitement, but it
became more exciting than they
had ever realized.
Afterwards, one of them said,
is this how they make their
decisions? I said,
you just got an inside view.
Okay, then in 2021, this group
called Next ten,
they published a paper authored
by three academics at Cal, and
they decided to make the fixed
charge a function of income.
And this is what the fixed
charge would have looked like.
The green line fixed charge
would have been close to $175 a
month if you were above a
certain income threshold. Can
you imagine? I mean,
these values defy imagination.
And so ab 205 suddenly appears
out of nowhere, and nobody
today, and I'm curious if any
of you know who authored that
paragraph. Nobody is rising
to the occasion. You would
think they would be proud
of what they did, right?
But they have fingers
on their lip like
in a catholic school. Nobody
will betray the name of that
individual because that
individual may have an issue
starting their car, turning the
key might become a challenge
for them. You know what I mean?
So it said, the commission.
The commission may authorize
fixed charges. Didn't say
shell. It didn't say would. It
didn't mandate. It just said
May. But suddenly that May was
taken to be shell. It always
is. It always is. And it was
like the height of duplicity.
There's another world,
but I can't find it. Okay, so
the CPUC forced the IGFC,
the income graduate,
into an ongoing proceeding
on demand flexibility. Now,
demand flexibility is about
having time varying rates.
Fixed charge is the polar
opposite
of a time varying rate.
But you can count upon the PUC
to bend the rules so that even
a beef looks
like a vegetarian steak.
Okay. Several parties submitted
their proposals on April 7,
which was good Friday
of last year. Turn, which had
always opposed a fixed charge,
suddenly came out swinging
in full support. Why? Because
their customers would see lower
bills. Because the fixed charge
was going to be really low
for them, and they would still
get the same volumetric charge
reduction. Teamed up
with an environmental group,
NRDC, which had also always
opposed fixed charges. I was
dumbfounded. I said, you know,
this is beyond my abilities.
This is where the Matt Damon
angle comes in. Somebody has
entered the room that has
suddenly cast a shadow
on everything I learned about
raid design and how agencies
work. To this day,
I can't totally figure it out.
Okay. The ious submitted a
testimony. I'm going
to speed up. There are details
here. I think this deck can be
shared
with the others afterwards.
Right. Okay, so this was,
it went
through some gyrations. This
was their original proposal.
Looking at PG and E. It would
have been $92 if you were not a
care customer or not a Fara
customer, hardworking,
middle income couple. All
of those would fall
in that fourth category, and
suddenly they would be paying
$92 a month extra. They said,
this will promote
electrification,
but as I'm showing here,
it won't. It's a shell game.
So you think you're ahead
because your energy price went
down. Oh, but suddenly every
month they're taking a fixed
charge out
of your same pocket. I mean,
you'd have
to be not paying attention,
but after three months,
everybody will figure it out.
So they were hoping the
swindling game somehow will not
be picked up,
and everybody would say, oh,
yeah, the fixed charge is
like a price
for my citizenship of the
United States, act
of patriotic fervor.
>> The fixed charge would be
applied to everyone regardless
if you were
in a CCA or not.
>> Regardless
of which territory you were in
and regardless whether you were
CAiR or Fara.
But it would vary by income.
So that's what they have done
now. And I guess the new
charge, you probably know. So
the utilities started
to lower their numbers, and
what ultimately got approved
was this proposal where they
created three tiers. The first
tier is care,
really low income. Your fixed
charge is only $6. And if
you're sort of just
above that, but still under,
you know, under $50,000, let's
say, to pick a number,
it'll be $12, it's double the
$6. And if you're everyone else
making $60,000 a year or more,
you're going to pay the $24.
And where did they get the
number? It's not based
on cost, it's based
on a cheat sheet of the Smud
website. They just copied the
smud number. And what I said
to them was, if you're going
to copy Smud's fixed charge,
also copy their energy charge,
which is, you know,
don't just do cut and paste
of half the text, you have
to copy the entire text. You
know,
they should be embarrassed.
Just copying smuts number was
the most idiotic thing,
honestly, in raid design,
that I've ever seen. Three
large utilities, copying a
small utility's homework
assignment and turning it in,
and the commission saying, yes,
you passed. That was the part
that really hurt. I mean, how
could the commission not see
what was going on? I'm sure
they did. And the larger
utilities wanted to say,
we're only going
to charge what Smud does
because everyone knows that
Smud has great rates. So
they're, like you said,
they're only looking
at half the equation,
but they're trying to say, oh,
well,
we're not charging very much
because, look,
we're doing what smud does,
and everyone loves smud. I must
admit, Smud should have
objected. I mean, but I don't
think officially they have. Or
maybe they were happy just
to have something copied. They
were going to charge two
thousand five hundred dollars
to two hundred dollars. It's
like, oh, now we're only
charging you this much. They
said,
we have made a huge compromise.
We have dropped it down
from ninety two dollars
to twenty four dollars. And I
was so vocal on this,
they kept reaching to me
through back channels. You
should be happy now. It's just
24. It's not the 92. Yes, as we
hear what you're saying. I
said, where did you get the 24
from? You just copied it
from smudge. And I said,
I'd be okay if it was $15 or
something small. You can't go
from zero to 24 suddenly
in one fell swoop. So here is
the part that's more worrisome.
The 24 has the appearance
of looking halfway decent,
down from 92. But the PUC has
left the door open
to raising the fixed charge in
subsequent rate design cases
and also to introducing more
income tiers. This is what they
say. The camel has got his nose
under the tent. And once the
camel is in there
through the nose. I've been
to Saudi Arabia many times as a
consultant. Okay, so
unanimously approved, four
to zero. One commissioner
recusing himself because he was
the head of the PAO,
the public advocates office.
And this unanimous vote came
despite several cautionary
editorials in the LA Times, the
Chronicle and the Bee and many
other national publications.
And many cautionary letters
were sent
by state assembly members,
state senators, and even
federal congressional
representatives to Alice
Reynolds, the president
of the PUC. It ignored, I mean,
just defies the description
of decency. This charge is
going to be the second highest
in the country. So we're going
from zero, which is the lowest
in the country,
to suddenly the second highest
after a utility in Mississippi
that is not known
for doing anything
for energy efficiencies. So
very, very strange,
embarrassing,
and they'd never show you this
chart, but that's the day they
never benchmarked anything that
they were doing. So
in closing, what I will do is
I'll say if the intent was
really
to promote electrification,
they took a wrong turn. They
went down this way. And if
somebody was to ask me,
what should they have done?
And maybe they will come
to their senses and go
in this direction,
even though I doubt it. But
at least I felt compelled
to add a couple
of slides here. The first thing
the PUC should do is cap the
growth of electric rates
to the rate
of inflation long overdue. We
can't double it every eight
years. Find ways
to lower cost, and thus the
rate level why are PG and E's
rates three times the national
average? Offer low income
customers additional rebates if
you want to really encourage
electrification and focus
on the low income segment.
But the challenge that I have
with the low income segment is
their priorities are food,
clothing, shelter,
transportation,
and education. Those are their
five most important things.
Energy is important and they
certainly want affordability.
But they're not going
to buy a heat pump,
which is so expensive. Many
of them rent a house. They
don't even own the house and
they don't even own a car. So
how are you going
to help them?
By subsidizing the price
of an EV. So the best way
to do it, in my opinion, is
to have a modest fixed charge.
Yes, we agree fixed charge is
needed. Do it gradually, ten
to $15 is reasonable. And then
set the energy price equal
to marginal cost. Let it vary
by time of use, but only apply
this marginal cost rate
to new purchases, not
to your existing. This is the
second time I've done it today.
I'm sorry. Spill the water.
It's not big. Basically focus
on the new decision making that
customers have and they're
in the market
for a heat pump. Say, okay,
we have AI technology today.
We have smart meters. We will
know how much energy the heat
pump is using and this marginal
cost rate of $0.10 will apply
to your heat pump. That will
suddenly boost the sales of
heat pumps and do the same
thing for the electric car. So
apply it at the margin, and
that way the utilities don't
lose revenue. They're still
getting their current revenue.
You don't have
to do the shell game. They are
still made whole and
at the margin yourself,
lowering the price to reflect
what you're saying is the true
additional energy cost and
everyone's happy. And
by the way,
I didn't just make this up.
This is already being done
somewhere. It's in the state
of Georgia
for C and I customers,
commercial and industrial
customers. Georgia Power has
wanted
to encourage electrification
since the nineties and they
have had a rate which applies
at the margin, and it is the
marginal cost and it's really
low. And when I first saw that
rate, the person who developed
it had come from South
Africa. He was well versed
in all of these issues because
they had done it for their gold
mines and diamond mines and
whatever other mines they have.
They have a lot of big
industrial load and they offer
this rate so that they can
electrify. And so I proposed
this. I said to Georgia
Power, I said,
why don't you apply this rate
to your residential and
commercial customers. Why only
for the big commercial
industrial customers. And I
said,
that way you'll promote a lot
of smart energy use. But of
course they didn't want the
residential and commercial
customers to use electricity
the way they wanted to. And I
said, why is that? They said,
you don't understand. You will
never understand. We have
something here called southern
comfort. Okay. So I stopped
pushing, but the idea stayed
with me and I thought this
might be the time
to revisit it and introduce it.
So I'm pushing this. I'm going
to try to get it in the
newspapers and other channels
because this accomplishes the
goal of electrification
without creating the mess
of a fixed charge that's based
on income. I'm sure they will
not do it, but if there's
enough public pressure, maybe
some legislators might get
interested and maybe some bill
might pass. So this is my
closing slide, and I hope you
found it interesting. Any
surprises? Any comments?
>> I appreciate the details
of how badly were being treated
by PG and E. We all know we're
being treated badly, but now,
we know the details.
>> It's amazing how they get
away with these kinds.
>> I don't get it.
>> I mean,
at some point I did a post on
LinkedIn, I said,
there's a dirty Harry here. I
don't know who it is,
but the dirty Harry is killing
legislation
to stop the fixed charge. It's
killing legislation
to change the solar rules. And
so I was told there is a person
x whose name,
thankfully I forget who,
is walking the halls,
and he is their broker. And the
broker,
I don't know what tactics he
uses, but when one
of the bills AB 1999 was set
to be voted upon by the Energy
and Utilities committee,
and that would have put a cap
of dollar 25
on this and said, it'll be no
higher and even this will be
revisited after three years.
The chair of that committee had
been talked to and decided
to not even put it
on the agenda. So how can you
vote on something that's not
on the agenda? And so they
couldn't take a vote. And it
was so frustrating because so
many
of the legislators who are
Democrats and also Republicans
would have supported it. So how
do you prevent an embarrassment
from occurring where ultimately
the governor will be forced
to admit that in a democratic
state the legislature
overturned his wishes and then
his chances for the White
House would be reduced
to negative, perhaps,
if not zero. So just get it
off the agenda. So they got it
off the agenda, but the hue and
cry was such that then it came
back. It came back
for a vote slightly modified,
actually, quite a bit modified,
and there was hope. But what
they did was they didn't tell
people that today the vote will
be taken. And so only two
people were there who voted
for it, and they said,
that's not enough. So it has
died. I mean, these are
shenanigans that I had no clue
about. I mean,
this is very clever
manipulation
of public opinion. So hard
lesson here, right? I mean,
it's sort of. We're dealing
with a very tough. What should
we call it? Environment. I
mean,
I don't know what else to.
Political environment. I've
never seen it this bad
in any state of the union. So
how could California be doing
this?
>> You mentioned earlier there
hasn't been a movie
about this, but there actually
has been an investigative
series about all this and the
corruption and the tie
to the governor,
the broader issues.
>> Well, the bailout. Remember
the bailout?
>> Yes.
>> I mean, firepower, money,
it's been out there. It's so
ingrained. You know,
when this series came out,
I tried to share it and get
people. I don't understand it.
>> Would you share this
with me? Would you be able
to share that with me? The link
that she has?
>> I'm gonna check it out.
When did it come out?
>> The last most recent one
because it was a series 2022.
>> What's it called?
>> Firepower, buddy.
>> I can share the link
to you.
>> One where they looked.
Recovery for your fires.
>> Not used to your system.
Sorry.
>> So that's something else.
Did it generate some opinions?
>> Yeah. I mean, in my mind,
because this is. This was put
out prior
to the governor's reelection,
and I had hoped it would get
some traction,
and it didn't.
>> That is amazing.
>> I mean, it's sort
of disappointing to see all
of this happening in this
state. I would expect this
to happen in Missouri, you
know, not to pick
on any other state, but I have
to pick on one. And so I could
see it happening
in the deep south, but here,
it's just, I don't know what is
being achieved. Who's better
off? Power and money, you know,
they always go together,
don't they?
>> At one time,
had quite a public conversation
with some PG and e official,
so putting profit above
maintenance. I'm an old public
works guy. You know,
we're going
to pay our stakeholders
before we take care
of our equipment,
which led and right now, I'm
out of Nevada county, which is,
by the way, if you don't know,
this is the home of PG and E.
That's where PG and e came
from.
>> The original.
>> Came out of Nevada county.
Congratulations. And right now.
Right, right now,
we've got a failed dam,
a failed hydroelectric dam
by PG and E, who did not do
proper maintenance on
Spalding Lake. And you have an
entire county looking at
potential water restrictions
throughout the entire summer.
Two counties. Two counties,
yeah, that's right.
With the failure
to do proper maintenance at a
hydroelectric facility.
>> That's a recurring theme
through every analysis I have
read. And if you've seen the
book California burning, I
mean, actually,
she did a great job,
but still left out a lot. So I
sent her a lot
of material afterwards. She's
not from California, right? I
mean, she came
from another state, so.
But even she uncovered a lot.
And what does the CEO of PG and
E do when that book comes out?
Is obviously, you know,
a thorn in the side. She says,
oh, I have bought 100 copies
and distributed them to our
management so we can learn what
not to do.
>> I had a PG and E public
representative stand up at my
council meeting and say that
the new CEO is teaching them
all to lead from their heart.
My attorney thought I was going
to throw up on the dice.
>> It's amazing.
>> We just all accept it.
>> We also sitting here going,
well, what can we do
about it? It's just. That's the
way it is. It's too bad. And so
I guess the question we have, I
think the only solution is a
bypass. The only solution is a
bypass of the POC by going
through the legislature.
You've got to get the dirty
Harry out of it.
>> CPUC is unregulated.
>> It's sort of
like limitless rate increases,
no questions asked.
Apparently, there's some rule
that somebody told me,
they'll give you 85%
of whatever you ask. So you ask
125% to get the 85%. It's sort
of like back to the dark ages
of man, so to speak, where you
had special interests and they
had a code,
and you were not let
in unless you were part
of that group. And regardless
of what the public opinion was,
the king, or whoever it was,
the queen did whatever they
wanted to do.
But it was legitimized
by some stamp,
like some agency, the Public
Utilities Commission, back in
2015. It was the last time, I
think,
I testified there. I was
at a party, the night before,
and I said to my host, I have
to leave a bit early because I
am testifying tomorrow. Where
are you testifying? I said
before, the California Public
Utilities Commission. That's a
rogue agency. What are you
doing there? You lose your
reputation just by appearing
before them. I didn't even tell
them on whose behalf I was
testifying. Had I mentioned
that,
they would have kicked me out,
probably right away.
But I mean, these are very
unfortunate situations which
none of us really should be
discussing, except that we
can't avoid discussing them
because they define our
reality. I mean, ccas, one
of the reasons they came into
being was this reputational
damage that utilities,
actually, a while back, one
of them hired me to investigate
why CC's were being created.
And I said, okay, I need
to talk
to the decision makers,
the city governments, the
counties, municipalities. No,
we are not allowed. You can't
talk to them because they had
that legislative limit put
on them. So I said,
how am I supposed
to get the data? Then they
wanted me
to forecast the growth
of ccas. And I said,
how can I forecast
without data? That's why we
hired you. Oh, okay. So I found
a lot of data by reading.
Actually, somehow I should have
taken it that way.
But the dumb part of me said,
no, I have to do analysis.
Otherwise I could have just
said,
here's what the experts said.
Well, it turned
out there was a lot of data
in the public domain,
which was newspaper articles,
do master's theses written
on the topic. They had
interviewed the decision
makers. So I compiled a list of
factors that were leading
people to become ccas. The
first one was the high price
of electricity. Second one was
local content for the power.
The third was green content
for the power. And the fourth
one was, oh, a messiah came
to sell us on this idea as
being an intellectually
compelling thing to do. And the
fifth one was, the neighboring
community just did it. So I
listed these factors. That was
the best I could do. I'm sure
they knew all of this anyway,
so then one of them looked
at me and said, you left out
the most important factor. I
said, what is that,
anti utility sentiment? I said,
I wasn't going to mention it,
but since you mentioned it,
yes. I mean, they know it.
They know it. And I think
forecasts are indicating 80%
of California
at some point will be ccas.
So, you know, they brought it
upon themselves. They did.
>> But you'll continue
to see rate increases to cover
their operating costs while
their markets shrink.
>> That is correct.
>> That's what we've been
seeing. That's what we've been
seeing is their markets reduce,
the rates go.
>> I mean, we were talking
about the San Francisco
Chronicle. I had to buy a copy
the other day because there was
a particular nice editorial
in it. And I thought, okay,
I'll buy a hard copy. I paid
$3. First of all,
it took me many stores
to find one that sold it. Even
my library said,
today's issue has not come in.
I said, how could it be? They
said, it's somewhat random.
Some days it comes in. So, I
mean, tanking $3. So, I mean,
that tells you why people don't
think it through. The more you
raise your prices, the fewer
they will come. And then you'll
keep till you have one customer
paying a million dollars for
the Sunday Chronicle.
>> Doctor Farooqi,
thank you so much
for being here.
>> My pleasure.
>> We look forward to having
you back.
>> I appreciate it. The slides
will be shared,
and if there are any further
comments, reflections,
etcetera, I'm happy
to respond via email.
>> Thank you so much.
>> All right, I'll head out.
Thank you.
>> That was great. Thank you
very much, Don,
for having that scheduled.
Really enjoyed hearing from
Doctor Farooqi. Next item
on the agenda really quickly,
board member, communications. I
don't think we have any report
outs for committees, so. CEO
communications.
>> I'll keep this very brief,
but I do want to welcome. So
she actually started with us
in May,
but the meeting went long,
so we didn't get a chance
to introduce her. But Kelly
Neuer joined us as our customer
care coordinator,
and this was kind
of a stars lined up moment. So
she is from this area. She
worked at PCWA
for ten years and then kind
of took her career
across country to North
Carolina. And
at the same time that Alexia
retired, she was looking
to come back. So the stars
lined up and we were able
to make this happen. So, really
happy to have you here. And if
you're ever making a cross
country trip, she's done it
about six times,
so she knows where to stop. So
maybe you want
to make a quick introduction
to the board. Thank you,
Kelly.
>> Yes, I'm Kelly. And my last
job, I actually onboarded Sean
Loman, which was fun. So we've
had a lot
of history together,
but I'm really, really happy
to be here. When I was looking
to come back to California, I
had a list
of things that I wanted in the
company that I worked for. I
wanted it to be small enough
that I mattered and could make
an impact. I wanted it to be
local because this is my
community and I wanted it to be
something that actually did
something good for people. So
if I was going to be part of
writing copy or marketing or
anything else, I wanted it to
be that something that was
actually good for the people
and then I stumbled on Pioneer
and told my whole family,
I'm applying for this job. I
was so excited. I'm very happy
to be here. Thank you
for having me.
>> Thank you, Kelly. And second
new hire I'd like
to introduce is Jake
Trumbull. He comes to us as our
communications coordinator. He
also spent
over a year as an internship
at intel working in the
marketing and outreach areas.
He also previously worked
for a demolition company. If
you need something blowing up,
he'll help you with that.
Anyway, please, Jake.
>> Demolition for hire here.
No, really excited to join
everybody here. I graduated
from Sac State
about a year ago now
with a degree
in public relations. Excited
to join the communications team
with Kelly, Gina, Lisa, and so
many more. Just ready to get
to work for you guys.
>> Thank you.
>> Thank you, Jay. Just want to
also announce that starting
tonight,
throughout the weekend last two
years, we were present at the
El Dorado Fair, and this year
we're doing placer.
But we did do a sponsorship
at El Dorado Fair as well. And
we saw you last week,
staff did. So we'll be there
at a booth. Please stop
by if you're in the area. And
one more announcement would be
that this will be our last
meeting with Patrick as our
general counsel. I just want
to say thank you so much
for all the work that you and
Richard Watson, Kishan and your
other folks
at the firm have done
in supporting Pioneer. And we
did go
through an RFP process,
and it was about that time
to do it. And we're going
with a more local firm in
Grass Valley that we'll be
introduced to next month.
But again, I want
to just thank Patrick
for contributing
to our success. And that's it
for my report.
>> I just want
to say thank you. It's been a
pleasure working with you the
last five and a half,
six months. Staff has been
great. All of them. Teresa has
been great, Brad and all
of them have been great. So I
really appreciated the
opportunity and wish you all
the best of luck.
>> Thank you, Patrick.
We really appreciate all
your service to us. So thank
you.
>> And that's it for my report.
>> All right, with that said,
seeing nothing further
on the agenda,
we will hereby adjourn
without objection. That's the
order. Adjourn 4:44.