April 27, 2022
Sangre de Cristo Board Meeting
(AVCSEF comments are in italics)
The April meeting of the board of directors was largely uneventful, however, there were a couple notable discussions.
AVCSEF Vice-Chair and author of the MAP proposal made the following comments that I think encapsulates much of the frustration members have with the operations of SDCEA:
Thank you for this opportunity to provide comments and input. I wish we had a process where we could engage with the Board for more than a one-way dialogue for 2-3 minutes per month.
I’d like to start out by thanking Sangre de Cristo staff and field crews for keeping the lights on during our surprise 16” heavy wet snow event on Sunday evening. I think providing power during this recent storm, as well as the numerous high-wind events we have experienced this spring, is testimony to the hard work of the field crews and the wildfire mitigation work that has been done so far. So thank you.
I’d also like to express my disappointment to the Board on several issues:
1) answers to questions raised by many members about the PSE cost of services study have never been provided;
2) the video explaining the study has not been made available;
3) we don’t know what PSE has now been tasked to do and we don’t know what member input has been provided to them; and
4) a draft proposal for a member engagement process has been presented for review and discussion but has been met with silence for two months.
It appears that SDCEA does not care to explain the results of the cost of services study that its members paid for, and it does not care to engage with its membership with a formal process to discuss concerns and the future of our electric cooperative. The draft document on a Member Advisory Panel that was provided to the Board on March 5th was meant to open the door for discussions. If it missed the mark completely or was too overwhelming or too one-sided, I ask you all, what is your vision for a member engagement process?
It shouldn’t be this difficult; other cooperatives are doing it. Something more is needed than this 2-3 minute dialogue at the Board meetings each month. There should be an open and transparent dialogue with members, not secrecy and silence. Frustrations are growing and that’s never a good thing.
Thanks for your time.
In response to questions about the Trout Creek Solar project, there was a comment that it should be back up and running soon after their inverter is replaced. AVCSEF Treasurer Sue Greiner asked about the terms of the board members, and was instructed to send an email to the staff to find out when the board members’ terms expired. They seemed surprised to find out it wasn’t on the web site.
Sarah and Chris (McGinnis) have been tasked with preparing a “roadmap” for member engagement by the May meeting. (There is a “special” board meeting scheduled for May 18 - this is not the usual time for a board meeting, the next “regular” board meeting is supposed to be on May 25, it is unclear if the special meeting will take its place)
The two topics of the meeting are CRS 40-9.5-108 and SDCEA bylaws Article III Section 3 both of which are included here:
40-9.5-108. Public meetings - definition.
(1) All meetings of a cooperative electric association are declared to be open meetings and open to the members, consumers, and news media at all times; but such association, by a two-thirds affirmative vote of the board members present, may go into executive session for consideration of documents or testimony given in confidence, but such association shall not make final policy decisions or adopt or approve any resolution, rule, regulation, or formal action, any contract, or any action calling for the payment of money at any session which is closed to the members, consumers, and news media.
(1.5) All meetings of a generation and transmission association are declared to be open meetings and open to the members, consumers, and news media at all times; but such association, by a two-thirds affirmative vote of the board members present, may go into executive session for consideration of documents or testimony given in confidence.
(2)(a) Before a board of directors convenes in executive session pursuant to subsection (1) or (1.5) of this section, the board shall announce the general topic of the executive session.(b) At every regular meeting of the board of directors of an association or a generation and transmission association, members of the association shall be given an opportunity to address the board on any matter concerning the policies and business of the association. The board may place reasonable, viewpoint-neutral restrictions on the amount and duration of public comment.(c) Written minutes shall be made of all meetings of the board of directors of an association or a generation and transmission association. The minutes shall be posted on the website of the association or generation and transmission association as soon as they have been approved and shall remain posted until at least six months after the date of the meeting. Upon request by a member of the board, that member’s own vote on any issue shall be noted in the minutes.
(3) Any action taken contrary to the provisions of this section shall be null and void and without force or effect.
(4) As used in this section, “generation and transmission association” means a nonprofit generation and transmission electric association that provides wholesale electric service directly to Colorado cooperative electric associations that are its members.
SDCEA Bylaws Article III SECTION 3. Public Meetings -
A. All meetings of SDCEA are declared to be open meetings and open to the Members, consumers, and news media at all times; but SDCEA, by a two-thirds affirmative vote of the Directors present, may go into executive session for consideration of documents or testimony given in confidence and for the purpose of discussing personnel matters, pending litigation, or negotiations for the sale or purchase of real estate. SDCEA shall not make final policy decisions or adopt or approve any resolution, rule, regulation, or formal action, any contract, or any action calling for the payment of money at any session that is closed to the Members, consumers and news media.
B. Prior to the time the Board of Directors convenes in executive session, the Board shall announce the general topic of the executive session.
C. Any action taken contrary to the provisions of this section shall be null and void and without force or effect.
Sarah said that some ideas from member input on the cost study have been forwarded to PSE, including Tom’s detailed email on alternative rate schedules, including the minimum bill concept. They are also looking at rate schedules of other co-ops and IOUs to see what they are doing. In Sarah’s words “no stone will be left unturned” when it comes to PSE looking at alternative rate schedules. During Mark Boyle’s comments he encouraged them (and PSE) to consider the value of solar to the grid.
It was announced that the Director that represents Buena Vista on the board, David Volpe, had resigned his service on the board of directors. This is an important development - the board of directors will now appoint a person to fill the term of Volpe on the board. There was no reason given for the resignation.
The terms of replacing a board member are outlined in board policy - the board indicated that they would welcome applicants and announce the opening, a committee would be formed and a decision on the new board member would be made in June or July. Here are the bylaws governing resignations:
SECTION 4. Nominations - Nominations for Members to serve on the Board of Directors shall be made by petition. Any petition for nomination shall be in writing and be signed by not less than fifteen (15) Members of SDCEA. The official petition shall designate the name of the nominee, the term for which the nominee is being nominated and the Director district for which the nomination is made. If a candidate qualifies for more than one Director seat in an election, such candidate must declare the district sought and may only submit a nominating petition for the one declared seat. All nominating petitions shall be filed at the principal office of SDCEA with the secretary at least sixty (60) days before the Election Day. Incumbents shall state their intent to run by December 31 of the year prior to the expiration of their term. Nominating petitions shall be available to Members no earlier than January 2 and no later than February 1 for Director terms that expire that year.
SECTION 5. Resignation of Directors - A Director may resign at any time by giving written notice. The resignation of a Director is effective when the notice is received by the highest- ranking remaining officer of the Board of Directors, unless the notice specifies a later effective date.
SECTION 6. Vacancies - Any vacancy occurring in the Board of Directors may be filled by the affirmative vote of a majority of the remaining Directors for the unexpired portion of the term.
Board Director Charlie Abel was appointed to attend a meeting of the Cooperative Finance Corporation in Boston. No alternate was chosen.
Operational Strategy:
Member engagement: the board has proposed a member engagement strategy that would involve meeting with select groups to meet in a private setting. Groups suggested were optimists groups, business organizations and homeowners associations.
The proposal was for 12 small group meetings per year.
Board Director Charlie Abel proposed reducing that number to four meetings (quarterly)
Board members expressed an indication that it wouldn’t be necessary for board members to go and staff could do the meetings.
Board Director Suzy Kelly suggested that perhaps one board member could go with the staff.
Beneficial Electrification
There was a discussion around electrification and new developments that are going all electric. This has led to larger than expected increases in demand of 2.72% (over their target of 1.8% load growth). Some of this was moving customers off of diesel generation to electric reducing GHG emissions. They discussed the possibility of future rate structures having a declining block rate for electrified homes. (a declining block rate is a lower charge for blocks of higher use of electricity - for example, 0-500 kWh of usage would cost 12¢/kWh while the next block of 1000-1500 kWh of usage would cost 9¢/kWh. It’s important that such a policy would be tied to electrification of fossil uses - for example vehicle charging, heat pumps, electric water heating, etc… so that it’s not simply encouraging increased usage of electricity over energy efficiency).
Included in their discussion of their Strategic Objectives was a slide that indicated that one of their strategic goals was to “Mitigate financial risk of self-generation and storage through cost based rates.”
This objective reflects the board view that self generation and storage are financial risks and that they cost customers money. There has not been any evidence of this , however it is clearly a belief of the CEO and the board based on their previous actions around rates.
Attorney Casey Martin said that he and a lawyer representing Gunnison County Electric Assoc. plan to attend a CREA legal seminar in Denver next week (May 6). They will be presenting on the current net metering law in Colorado and exploring options regarding the net metering statute. They will be looking at what other states are doing. This is disturbing because Colorado Net Metering law is considered a gold standard. Other states are passing laws to eliminate net metering (such as the bill recently vetoed in Florida).
Casey is also looking at the franchise agreement with Buena Vista and said the current agreement is “a mess”. He said CORE’s agreement with Fraser is a good example.
Financial Report
During the financial report, it was indicated that the revenues of the cooperative were down by 1.5% and the expenses were over budget by 10.5%