Idaho Falls Utility Board Meetings

December 20, 2023 The Idaho Falls Power Board of the City of Idaho Falls met Wednesday, December 20, 2023, at the Idaho Falls Power Boardroom, 140 S. Capital, Idaho Falls, Idaho at 8:00 a.m. Call to Order, Roll Call, and Announcements: There were present: Mayor Rebecca L Noah Casper Board Member Michelle Ziel-Dingman Board Member Tom Hally Board Member Jim Francis (left at 10:01am) Board Member Jim Freeman Board Member Lisa Burtenshaw Absent: Board Member John Radford Also present: Bear Prairie, Idaho Falls Power (IFP) General Manager Stephen Boorman, IFP Assistant General Manager (AGM) Randy Fife, City of Idaho Falls Attorney Josh Roos, IFP Chief Financial Officer Chase Morgan, Power Supply Manager Linda Lundquist, IFP Board Secretary Mayor Casper called the meeting to order at 8:01 a.m. Calendar, Announcements, Events and Updates Mayor Casper reminded the Board to take the 2023 Board survey by mid-January. She said that she and some Board members attended the Utah Associated Municipal Power Systems (UAMPS) annual meetings last week and mentioned that it may not be worth the Board members attending in the future due to a lack of relevant and interesting speakers. Board Member Freeman’s takeaway was that UAMPS is redirecting priorities after ending the Carbon Free Power Project (CFPP). Mayor Casper mentioned the nuclear podcast “Decoupled” is a valuable industry perspective to consider as the utility moves forward in resource exploration. She announced an upcoming Nuclear Summit in Belgium and explained the Tech Hub grant project that she is collaborating on with the City’s Community Development Administrator. Mayor Casper said the Symphony’s Mariachi Christmas is looking for feedback and said it was her opinion that attendees seemed delighted with the event. Board Member Burtenshaw said she thought the event was a fabulous outreach and gave a full thumbs up. General Manager (GM) Prairie observed that the Hispanic community seemed very connected and appeared engaged in the event. Board Member Francis attended the Relations with Government meeting and pointed out the Department of Energy (DOE) is starting to put its 2026 budget together and said he thinks that now is a good time to get in budget requests. Mayor Casper expressed her concerns about Washington’s energy appropriation/representation in ten years as Idaho will be losing a longtime representative in Mike Simpson as he eventually retires from office at some point in the future. GM Prairie discussed upcoming memo items for Council’s consideration, including Caterpillar’s (CAT) generators, and explained that the purchase is separate from the ESI contract for tax purposes. IFP is planning on purchasing and installing this equipment themselves after consultation with the State Tax Commission. He pointed out that in reviewing the ESI proposal, some items were missing, as opposed to Wheeler’s proposal. Staff is continuing to get all proposals to an “apples to apples” comparison status in order to give a second glance to ensure we select the most qualified following state procurement statutes. He talked about the importance of getting the generators ordered because they are long lead time item as  December 20, 2023 Unapproved long as it makes economic sense and summarized that the project is coming in close to $35 million. Board Member Burtenshaw asked what other utilities are doing for new resources and GM Prairie said not much regionally, as the Northwest had traditionally relied on Bonneville Power Administration (BPA) but is also realizing that BPA cannot meet their needs going forward if they are a growing utility like IFP and he also pointed out that California is actively building gas peaking plants under the state program that we have talked about in prior Board meetings. Attorney Kirkham pointed out that if Council is asked to purchase the plant’s generators, their approval signals a green light to move forward with the project. GM Prairie said that he and staff are continuing to review the numbers and viability of the project before Council’s first meeting in January 2024 and Mayor Casper explained if the purchase item is seen on the agenda, then it has passed muster but if not, will be brought for discussion in the February Board meeting. No concerns were expressed with the plan of action concerning the peaking plant. Legislative Update Idaho Consumer-Owned Utilities Association (ICUA) Executive Director Will Hart gave a brief overview of ICUA’s upcoming Legislative meetings to be held in January and discussed the status of the Federal settlement discussions over the hydro system centered mainly around the four lower Snake River dams. Mayor Casper asked if there is value in utilities to file individually and Mr. Hart pointed out that being a member of the Public Power Council (PPC) is the best representation for IFP. He said that ICUA and its members also benefit when supporting Idaho’s Governor and Attorney General in Idaho’s Senate Joint Resolution in support of the Columbia River system power production, barging and transportation, agriculture, etc. GM Prairie said that ICUA is nonpartisan and backs representatives who support our issues. GM Prairie explained that Mr. Hart remains above the day-to-day politics, plays the long game, and is very respected in legislative circles. He thanked Mr. Hart for his hard work and influence that hit above board. Board Member Freeman asked how many new people there are in the State’s Legislature that need training on energy and Mr. Hart said there was about a fifty percent turnover in the last election cycle and explained that his job is not only bringing bills forward but also teaching legislators on the energy issues before them. He explained that California, Oregon, and Washington’s legislative policies are crushing them when they close plants that hurt the grid and GM Prairie said he continues to ask legislators to trust the industry, ask good questions, and continue to do what serves Idaho best. Mr. Hart said the majority of ICUA’s members received Office of Energy and Mineral Resources (OEMR) round one funding. There was a discussion on BPA’s contract negotiations and Mr. Hart noted a $34 billion replacement cost for the dams was the latest estimate in 2021 and explained that the tribes may not be guaranteed firm replacement based on what the current treaty represents. GM Prairie explained with the inflation we have seen this number is easily over $50 billion to mitigate all impacts and probably around $30 billion for the power component today with the latest resource costs. Geothermal RFP Results Review and Discussion Power Supply Manager Chase Morgan gave a brief overview of a recent geothermal conference he attended and shared his opinion that the request for proposal (RFP) for a power purchase agreement (PPA) could be a very good opportunity for IFP. GM Prairie said the geothermal resource is appealing because Open Mountain projects generation profile matches IFP’s load profile. He reviewed the generation resources that staff has been researching for the last five years, including the CFPP and the Horse Butte Wind Farm. He reviewed the RFP timeline for the geothermal contract. Mr. Morgan pointed out that the project is fairly mature with 65 MW in total at full buildout over the next 15 years and drilling rights already approved by the Bureau of Land Management (BLM). GM Prairie explained how geothermal projects work and that IFP would be the energy off-taker and would not be responsible for permitting because IFP doesn’t own the resource and receives the electricity per the terms of a negotiated power purchase agreement or PPA. GM Prairie stated another issue is the transmission and explained that the project is already near a BPA substation near Raft River and can be connected for transmission and pointed out is already in Idaho Power’s generation interconnection study queue request. Board Member Freeman asked if the PPA gets  December 20, 2023 Unapproved approved, when would the resource come online? Mr. Morgan said around March 2027 but could be a little later depending on the negotiation timeline. GM Prairie pointed out that $72 MW is in 2027 numbers, with no time value of money stuff like the CFPP project did. Board Member Burtenshaw asked how many other PPAs have been signed and GM Prairie said he was not aware of any. Board Member Francis asked if Open Mountain is willing to move forward with just IFP and GM Prairie said he would propose that IFP has first right of refusal on the expanded generation as the site continues to develop beyond the original 10-15 MW for IFP. Board Member Freeman said he thought that $72 MW seemed like a good deal. GM Prairie said that reliable, long-term, carbon-free generation in the $70 MW price range is a good deal from what he is seeing for available options and recommends taking advantage of it. He explained that Open Mountain can harvest tax credits and that he’d work with them on the tax law and mentioned that they seem open to whatever structure makes the most sense and commented that the contract will likely be a several-month process to hone and refine the details. Mayor Casper said it seemed like a smart thing to do if the business perspective is trustworthy and GM Prairie commented that he has not seen that Open Mountain has misrepresented their project, financial stability or experience. It was moved by Board Member Burtenshaw and seconded by Board Member Francis to give authorization to staff to negotiate a PPA with Open Mountain. The motion was unanimously approved. Utility Reports Safety Metrics – GM Prairie reviewed the current metrics and explained how he’ll add a third category moving forward and said he plans to address a couple of recent minor accidents and explore ways to avoid them in the future. Organizational Membership Reports PPC – GM Prairie asked the Board to review additional readings and PPC’s annual report. Board Member Freeman asked where BPA is on the dam issue and GM Prairie said the United States White House has advised their appointees to get behind their concept. He reminded everyone that the BPA Administrator has a boss, and that person is an appointee of the President at DOE, so John Hairston is likely between a rock and a hard place on this issue. He added that historically, regional utilities have had a lot of influence over BPA’s Administrator, but that could change with the current and next Administration and things could become more politically divisive with the customers having less influence than in the past. There being no further business, the meeting adjourned at 10:15 a.m. s/ Linda Lundquist s/ Rebecca L. Noah Casper Linda Lundquist, BOARD SECRETARY Rebecca L. Noah Casper, MAYOR