Rochester Public Utilities Board Meeting - November 26, 2025
Rochester Public Utilities Board Meeting - November 26, 2025
The Rochester Public Utilities Board convened at 4:00 PM for a regular meeting focused on budget amendments, energy storage authorization, and utility rate adjustments. The meeting opened with a safety moment regarding impaired driving during Thanksgiving Eve, followed by unanimous approval of the agenda and the consent calendar. The board addressed significant public concerns regarding a newly implemented grid access fee for solar customers before proceeding to approve a budget amendment for water infrastructure and a major battery storage project.
Consent Calendar
- Unanimously approved the consent agenda, including resolutions found on pages 121, 124, 129, and 132 of the meeting packet.
Public Comments & Testimony
- James Rentz (Rochester resident and solar owner): Expressed strong opposition to the new grid access fee, characterizing it as a tax that discourages solar adoption. He requested clarification on the redacted documents supporting the fee and argued that the fee works against the encouragement of solar energy, especially given the removal of federal subsidies.
- Evan (DER customer): Opposed the current implementation of the grid access fee, arguing it creates a short-term fix that leads to worse long-term costs for the community. He described DER systems as public-private partnerships and requested a six-month pause on the fee to allow for further discussion on how to slow rate increases and keep energy dollars local.
- Sarah Dukek (Rochester resident and recent solar panel purchaser): Expressed surprise and concern regarding the fee, noting it negatively impacts the financial viability of solar for new installers. She questioned whether the fee signals a trend of continuous rate hikes and inquired about strategies to decrease dependence on non-local energy sources.
Discussion Items
- Safety Moment: Safety Manager Bob Cook presented on the dangers of "Blackout Wednesday" (Thanksgiving Eve), highlighting statistics regarding impaired driving fatalities and urging staff and the public to commit to driving sober.
- 2025 Water Utility Budget Amendment (Item 4A): Director Todd Blomstrom presented a recommendation to reclassify $1.075 million in trunk water main oversizing reimbursement costs from the general capital expense fund to the water connection discharge fund. The presentation detailed that accelerated development and specific fringe projects (Badger Heights, Prairie Ridge) caused a substantial budget deficit in oversizing reimbursements. Staff explained that absorbing this cost would deplete fund balances and drive up rates for existing customers, whereas using connection charges aligns costs with the developers causing them.
- Battery Energy Storage Authorization (Item 4B): Director Bill Bullock proposed authorizing a 20-megawatt battery storage project via a tolling agreement at the RPU Service Center and Zumbro Station. The discussion clarified that the battery would operate on energy arbitrage (buying low, selling high) and provide capacity credits, aiming for cost neutrality. Board members questioned the tolling structure, security measures (specifically that the vendor does not have access to the SCADA system), asset removal liabilities at the end of the 20-year term, and insurance coverage. Staff confirmed the project is a pilot to gather experience before potential future scaling.
- Lead Service Line Replacement Update (Item 5A): Director presented an update on the lead service line replacement program, noting that state funding for 2026 was reduced from a requested $12 million to approximately $1.5 million due to new state funding tiers. The board discussed strategies to focus on removing "unknown" lines and managing carrying costs, while acknowledging the unfunded mandate challenges posed by the federal Lead and Copper Rule.
- Cybersecurity Professional Development (Item 5B): Director Kelchin provided a presentation on RPU's cybersecurity strategy, emphasizing the multi-layered defense against ransomware and nation-state actors. Staff outlined their use of tabletop exercises, risk assessments, and a Security Operations Center (SOC). The board prioritized cybersecurity as a key business function and committed to funding and training.
- General Manager's Report: General Manager McCullough provided updates on:
- SIMPA Membership: Discussed the Energy Cost Adjustment (ECA) mechanics, confirming that wholesale costs are determined by the SIMPA board and passed through to RPU customers, with RPU managing the retail calculation.
- Solar and Grid Access Fee: Addressed public pushback by explaining the economic necessity of recovering wire costs from net-metered customers who oversize their systems. He noted that while the fee reduces the subsidy for excess generation, customers still retain 70-90% of the value of their systems. He acknowledged communication gaps regarding the fee's 2025 delay and promised further outreach.
- Municipal Solar Grants: Announced that RPU secured an additional $2 million in state grants to install solar on seven additional municipal buildings.
Key Outcomes
- Approved Resolution 4A: The board voted unanimously to amend the 2025 water utility budget, moving $1,075,000 from the general fund to the water connection charge fund to cover trunk main oversizing costs. This resolution will be forwarded to the City Council for approval on December 1, 2025.
- Approved Resolution 4B: The board voted unanimously to authorize the 20-megawatt battery energy storage agreements at the Service Center and Zumbro Station, contingent on final SIMPA approval. Staff agreed to report on the battery's technical and financial performance after one year of operation.
- Informational Updates: The board received reports on reduced lead service line funding, cybersecurity protocols, and the rationale behind the grid access fee.
- Adjournment: The meeting adjourned with no further business.
Meeting Transcript
4 p.m. and this meeting of the Rochester Public Utilities Board is now called to order. Thank you for everyone that's able to be here. The first item on the agenda, item number one is the approval of the agenda. Do I have a motion to approve the agenda? I'll move to approve. Second. We have a motion, a second. Any discussion. Hearing none, all in favor say aye. Aye. Aye. Opposed? Carried. The agenda is approved. Item number two is our safety moment with our safety manager, Mr. Bob Cook. I've uh titled my safety moment this evening, Beware Thanksgiving Eve. And as I was writing that, it reminded me of what the soothsayer told Caesar, beware the Ides of March. And we all know how that one turned out. So uh, but leave it to the safety guy to talk doom and gloom the day or day two days before Thanksgiving. Uh, but there is a modern tradition that's become one of the most dangerous nights on our roads, and that's the Wednesday night before Thanksgiving. And I recently learned that it has a couple nicknames, one of which is drinks giving, and the other is Blackout Wednesday. Uh it's become one of the biggest bar nights of the year. Uh, friends reunite, college students come home. Bars run specials that draw big crowds on the surface. It sounds like a fun way to kick off the holiday weekend, but unfortunately it has kind of a dark side. Uh over the past decade, the night before Thanksgiving has also become one of the most dangerous nights for impaired driving, according to the Minnesota Safety Council and the National Highway Traffic Safety Administration from 2019 to 23. 149 drunk drivers were involved in fatal crashes on Thanksgiving Eve. Of those, 107 were male, 34 were female. The age group most likely to be involved are 21 to 24 year olds, followed closely by those 25 to 34. And in 2023 alone, 30 drunk drivers were involved in fatal crashes on that single night. These aren't just the statistics, yeah, statistics. They're lives lost, family shattered, and holidays that turned into heartbreak. So I think it's something we we all probably need to think about a little. Uh so what do we do? Uh, we can plan ahead, uh, make the safe choice, you know, drive 100% sober, designate a sober driver, uh, use a taxi or a ride chair if you need to. And if it's your turn to be the designated driver, take that seriously. Someone's life may depend on it. And if you see someone about to drive drunk, well, of course, see something, say something, take the keys, help them get home safely. So, because at the end of the day, we all want the same thing. Enjoy the holidays, be with the people we care about, and to make it home safely. So let's look out for each other, make smart choices. And remember, as you see on the billboard along the road, buzz driving is drunk driving. So thank you very much. And have a great Thanksgiving. Thank you so much. I appreciate that. Well said. The next step on the agenda is our consent agenda.
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