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HomeMy WebLinkAboutMinutes - City Council - 1981-02-25 City Council Study Session Police Dept. & Council Chambers Redding, California February 25, 1981 11: 30 P .M. . The meeting was called to order by Mayor Pugh with. the following Council Members present: Demsher, Fulton, Gard, Kirkpatrick, and Pugh Also present were Assistant City Manager Courtney, City Attorney Hays., Planning and Community Development Director Perry, Electric Director Simpson and the following members of the Electric Department staff: Jim Mix, Sam Linley, Randy Baysinger, Rick Cole- man, and Larry Lorenco'. Also present were Senior Associate Plan- ner King, Assistant Planner Larko, power consultant Earl Murphy and City Clerk Brayton. . • Other persons noted in attendance were Messers Clair Hill, Joe • Patten and Robert Harding, members of the firm of CH2M Hill, and Brad Brown. Mayor Pugh advised that this is a study session to review various energy programs in which the City is involved currently and • possibilities for the future energy needs of the City. CURRENT AND FUTURE PROGRAMS AND ENERGY DEMANDS Electric Director Simpson reviewed the City ' s present and future transmission lines as well as the current and future energy demands. With respect to power from the Western Area Power Administration, the City does not have a total agreement for WAPA to wheel power from the Keswick Switchyard but it does have a letter of agreement for Western to wheel power from the Tracy Switchyard, south of Sac- ramento. The City also has an agreement with PGandE for supple- • mental power 'to be wheeled from the Tracy Switchyard. He stated that the City has diligently tried to maintain the Western alloca- tion and has finalized an agreement that Western will supply 1116 megawatts of power to the year 2004. After that date, he noted, • the City has no assurances of receiving power from them. • At the request of Councilman Demsher, Mr. Simpson explained the 'function of Western--the .fac.t. that it' does not:'have the authority to build power projects', but may market, power and maintain trans- mission lines . Mr. Simpson estimated that .the City: of Redding.•will require a maximum of 110 megawatts -of power in 1981, •160 megawatts in 1990 and by the year ' 2000, it may need 200 to 208 megawatts of .power, based on estimated growth. He noted that by 1983 , • the City will need supplemental power. . Mr. Simpson outlined the City' s Energy Conservation Program as follows : 1) The use of energy efficient street lighting 2) Swimming ' pool program, wherein people are asked not to • use filtering systems during peak periods • Study,.Session , . . February 25; , 19.81 : : Page 2 , • • 3) Load management program- The use of computerized interrupt- ing equipment during peak periods 4) . Improvementsin power factor , - 5) Weatherization program . 6) Solar energy . . • 7) Co-Generation Units to operate directly with City of Redding system 8) Commercial Audits . ' i . He estimated that with all• the aforementioned programs in opera- , . stion;H there would be a maximum 10% savings . Mr. Simpson described how . the Western Area Power Administration' s costs for power are determined; i.e. , "Bank Account 1" and "Bank Account 2 Under Bank Account 1, PGandE would return all energyat• ' 2. 8 mills per kilowatt hour; under Bank Account 2, the agreement changed and PGandE will return power at the same .price it costs PGandE to produce power based on plants on line five years preceeding the call for power by Western. HYDRO. ELECTRIC PROJECTS . • Mr. Simpson stated that about five years ago, Council authorized staff to pursue. hydro projects . At present the following projects are being investigated: . ' is Lake Redding. ' ' . Red'.Bluff : . ' Whiskeytown Cottonwood Creek � . North Fork . ' • Saeltzer Dam ' Lewiston Dam f • Box Canyon. • Rainbow Lake • Stampede Power Project Lost Creek Power Project He explained that the City has filed applications for preliminary permits on Lake Redding, Red Bluff and Whiskeytown.: He said the City has had the preliminary permit for two years on the Lake Redding Project and has about one year left to file for a license • before the permit will expire. Mr. Simpson noted that there are rio time restrictions on construction once the license is issued . • - but it would be in the best interest of the City 'to pursue the . project as soon as possible. He added that the time line for fil- .: ing : for this license is especially tight due to the necessary environmentaLreports and requirements for fish studies . These • reports will be expensive and time consuming. He stated that the • power would be expensive when it first comes on line--.68 mills per- kilowatt hour and the project would cost up to $60 million to construct. For Red. Bluff project, the. City has approximately two years in which to file for the license. He stated that this project 4 Study Session February. 25, 19.81 • Page 3 will also involve fish studies .. He :advised that Red Bluff will • produce 14 megawatts ofRpower 'and' could• cost'up to $30 million. ,Mr. Simpson noted that this project will provide the same amount of power as Lake Redding,:at probably ,hal`f the•�.p"rice. • . • , • Councilman Kirkpatrick noted `that" the 'difference in the cost is • due to the fact that the Red Bluff..Dam ,is- already builtv whereas , for the Lake Redding project,' the= City would .have to build the dam. Mr. Simpson explained that for the Whiskeytown project, the City has a year in which to file for the license because the. preliminary j permit was .issued only for two years . - He noted that there are very • few environmental concerns on this project and the City, 'should be within the time .frame. for filing for the license. He further noted that the project will produce 4 megawatts of. power. In response to an inquiry from Councilman Demsher, Mr. Simpson advised that . if -Shasta Dam .is enlarged, it may or may not hurt the Lake Redding project. He stated that once we have the license, the project cannot be destroyed without reimbursing 'the City. • Power consultant Earl Murphystated that the application may be ' conditioned to .provide for this possibility. Mr. Simpson stated that preliminary permits have been applied . for but not- yet received on most of the remaining projects as_ listed above. - He noted that the Cottonwood Creek project is - one of the best projects and estimated that the preliminary permit may be received in 1981. He stated that as the dam is built, the City would .build generating. facilities . The Cotton- wood 'Creek project will produce 9 megawatts of power. • In regard to the North Fork of the American River project, the City of Redding is competing with at least three other agencies for the preliminary permit. This project will produce about 12 megawatts of power and the permit will probably be issued within . 18 months . • The ,Saeltzer .Dam will .p'roduce approximately z megawatts, of power. Mr. Simpson stated that the Lewiston Dam will produce possibly 2 megawatts, but the City' s share would be 1 megawatt. He • stated. that Box Canyon will produce 4 megawatts of power. He noted that Siskiyou County has a preliminary permit on Box Can- yon; therefore the City has not . filed an application. _ Mr. Simpson stated that the City has not filed the application for preliminary permit as yet on the Rainbow Lake project. He 'advised that staff has been working on it but has no recommen- . dation as yet: The project will be a 3 megawatt project. He further noted that the. project- is close to home, but has many environmental concerns. . • Mr. Simpson advised that the Stampede Power Project and the Lost • Creek Power Projects are projects which the City'-has recently: • Study Session February 25, 1981 Page 4 become involved in and will produce 3 and 2 . 6 megawatts of power, respectively. NORTHERN CALIFORNIA POWER AGENCY PROJECTS Mr. Simpson reviewed the projects in which NCPA is involved. He advised that they have been working on the Calaveras Hydro Project for several years and that it has many environmental concerns. He noted that the E.I .R. has not been certified as adequate. The project will be expensive and will produce for the City of Redding approximately 12 megawatts of power; the exact size has not been finalized. Mayor Pugh pointed out that this project illustrates what happens to the price of energy when a project drags out over a long period of time. He noted that at the time of the engineers report in 1975, the cost was 28 mills per kilowatt hour. Now, the cost is 58 mills per kilowatt hour. Mr. Simpson advised that the Feather River Project license is expiring and will be reissued to the entity who can best utilize the power. Mayor Pugh stated that this project (Feather River) is not one that we can count on in the near future for power needs ; that it will likely be after the year 2, 000 before completion. Mr. Simpson stated that another area in which NCPA is working is Geysers--steam projects. He stated that steam is expensive because it is based on the price of oil. NCPA is also involved in the Shell #3 project and the City will have the opportunity to purchase a share of said project. M-S-R POWER PROJECTS Mr. Simpson advised that M-S-R (Modesto, Santa Clara, Redding) 1/ is involved in Geysers, hydro projects at Mathews Dam and Ruth Lake, and the Arizona Nuclear Power Project. He stated that with the Geysers projects , drilling is very expensive and has some transmission problems. He advised that M-S-R is now negotiating on the hydro projects at Ruth Lake and Hogan Dam. With respect to the Arizona Nuclear Power Project, Mr. Simpson stated he would not go into detail as Council had been thoroughly briefed on this project. He advised that M-S-R and the Sacramento Municipal Utilities District have been discussing a possibility of a joint power agreement. Details of this agreement are not yet available, but noted that before it can be finalized, the City Council must give its approval. SUPPLEMENTAL POWER Mr. Simpson stated that while we still have Western's allocation of power,. especially over the next ten years, PGandE '.s. supple- mental power contract provides us with the ,least expensive supple- mental power available, at under 40 mill.s. p'er kilowatt hour. • • . Study .S.ess:ion February 25, 1981 . Page 5 In response to an inquiry from Councilman Kirkpatrick, . Mr. Simpson . advised that for supplemental power, we pay according to the . period of time which we exceed our allocation but on a monthly. basis . •• GENERAL COMMENTS Mr. Simpson commented that if • the: City is able to receive power ' from any of the proposed projects ' before it is needed, the City • will sell this power to the Western Area Power Administration. Mayor Pugh stated that' the overview given by Mr. Simpson has been very good and it is: important to note that any excess powerre- s. ceived. by the City will be sold to Western. He noted that time lines i' • are important in order to proceed with these projects now and for the future. . Mayor Pugh stated that some projects have such •com- • . plex problems that they are' hot feasible. He noted that steam projects and geothermal exploration is expensive. • •. Mr. Simpson stated that he has received the necessary support . from Council to proceed with these projects and' to obtain the . . necessary staff to do many 'of the studies in-house rather than • . by outside firms . . ADJOURNEMENT - : There being no further business, at the hour of 1 : 25 P .M. , the ' meeting was adjourned. • MILDRED L. BRAYTON, ity Clerk ' • - '. Ir ' bYa G�' - x, ,' ,; •- E-thel Richter, • Deputy City Clerk . _