Oh, we're on screen.

Do we start?

Okay.

Good afternoon, everybody.

Today is Wednesday, July 1st.

It's the meeting of the parks and city light committee, and I am going to call it to order.

My name is Deborah Warez, Chair of the Committee.

And Mr.

Clerk, will you please call the roll?

Councilmember Strauss.

Councilmember Saka.

Here.

Councilmember Rivera.

Vice Chair Kettle.

Here.

Chair Wars.

Here.

Chair, there are three three members present.

All right.

And I should add for the record that Councilmember Strauss has been excused, but he will be present to vote on July 15th when we do the rate ordinance.

And Councilmember Strauss did submit questions to Seattle City Light, which I understand will be answered today.

Let's move on to approval of the agenda.

The agenda will be adopted.

Not hearing or seeing an objection.

The agenda is adopted.

I'm going to go into the chair's report.

There will be a regular public comment period before the items on the agenda.

Comments should be laid today on today's agenda.

I'm sorry, I'm going to say this again.

Comments should be related to items on today's agenda and within the purview of this committee during public comment.

There are there is one resolution and two ordinances on the agenda today.

The first and second items are Seattle or City Lights 2027 2032 strategic plan resolution and the new retail rates ordinance.

These items will be presented together as the resolution informs the ordinance.

This is the second time we are hearing these two items across three council meetings.

Today there will be an in-depth presentation based on questions council members submitted for Seattle City Light last week, which Seattle City Light responded to with a memo yesterday.

As you recall, on June 17th, we asked our colleagues to submit questions as well as some other folks on the floor and central staff.

And um Seattle City Light uh was to meet and respond to those questions by yesterday's deadline, which was yesterday, June 30th.

Correct, Clerk.

Okay.

The presentation, I understand, is um nine pages of a PowerPoint presented by Rob Santoff, uh interim C GM CEO of Seattle City Light, Angela Bertran and Christy Granger of Seattle City Light and Eric McConaughey, our own Eric McConhey from Council Central Staff.

The third item on the agenda is an ordinance that gives a city gives City Light the authority to enter into long-term agreements for power purchase agreements.

The presentation consists of eight slides and will be presented by again Rob Stanoff, Shavon Doherty, and again our own Eric McConaughey.

Um should note for the record that we also had not just a PowerPoint but a summary in fiscal note that was prepared uh from Seattle City Lights legal counsel Jeff Wolfe.

I expect a vote on agendas one and three today, and the rates ordinance will be voted on on July 15th.

With that, we will go to public comment.

Mr.

Clerk, we will now open up the hybrid.

We will open the hybrid public comment period.

Public comments should relate to today to items on today's agenda and within the purviews committee.

Mr.

Clerk, how many people we got signed up?

We have zero in person speakers and four remote speakers.

Great.

Then let's go with the four remote and give each of them two minutes.

And is you need to tell Paul, you want to go ahead and yeah, go ahead, read the rules.

The public comment period will be moderated in the following manner.

The public comment period is up to 60 minutes unless extended at the discretion of the committee chair.

Speakers will be called in the order which they are registered.

We will begin with in-person speakers and then move on to remote speakers today.

Just remote speakers.

Speakers will hear a chime when 10 seconds are left of their time.

Speakers' mics will be muted if they do not end their comments within the allotted time to allow us to call on the next speaker.

The first remote speaker will be Alice Lockhart, followed by Rebecca Young, then David Haynes and Lauren Redfield.

Alright, each person has two minutes, and you will hear the 10-second, star six, and then you'll hear the 10 seconds or the beat for that means you have 10 seconds.

Go ahead.

Who's our first speaker, Paul?

Alice Lockhart.

Alice Lockhart.

Go ahead, Alice.

I see your there you go.

Good afternoon, Council members.

I'm Alice Lockhart, calling from D5, and I organize the 350 Seattle.

We completely concur with and appreciate Council Bill 121231's premise that Seattle City Light needs a new large load rate class to ensure that large load customers pay their fair share.

But we were surprised to see this on the agenda so early in the morning in the moratorium, and we heard the same sentiment from people who spoke up for the moratorium last month.

What the heck?

We thought there'd be community consultation, etc.

Um, I would love to see um the same sentiment expressed by council, and I'd love to see a unanimously passed amendment that reassures the public that there will be community input to a final and very likely stronger policy.

Please consider an amendment to the effect of council does not intend for this policy to preclude any legislation we may enact after community consultation during the data center moratorium.

We reserve the right to change, improve and/or augment this policy in future legislation.

It feels like it feels like that would be completely doable and would ensure, for instance, that y'all once we've talked could um enact yet stronger protections against stranded assets and other things that um obviously um Seattle residents uh would love to see.

Um, if you don't believe such an amendment would, you know, sort of hold legal water and be you know implementable, I guess I would ask council members to hold off on this legislation under until um uh until the moratorium has until we've done our work during the moratorium.

But I really um, you know, stronger policy now, yet stronger policy later.

Um yay, all of you, thank you so much.

Thank you.

The next remote public speaker will be Rebecca Young.

Rebecca, when you hear the chime, please press star six.

I don't see her tile.

Christy.

Oh, there she is.

Rebecca.

Can you hear me?

Yep, we can.

Go ahead.

Wonderful.

Um good afternoon and thank you.

My name is Rebecca Young.

I'm a resident in District 3, and I'm here regarding the proposed large load rate plan for data centers.

This is a good first step toward a more comprehensive large load policy.

I support creating a new dedicated customer class for large data centers, including requiring full infrastructure responsibility to ensure that existing customers, especially Seattle residents and small businesses, do not bear the costs of building out new infrastructures for data centers.

I also support requiring new data centers to pay the actual cost of procuring new power transmission and associated services instead of allowing them to benefit from Seattle's publicly funded legacy hydropower.

I would urge you to implement this new policy immediately for large new large load facilities and expand it to existing facilities above that 10 MVA threshold as soon as legally possible, for example at contract renewal, to ensure that all large customers are treated consistently over time.

And then finally, I encourage you to view this new policy as a minimum baseline for protecting ratepayers and ensure that the city's ongoing moratorium and work plan remain the space for broader questions regarding data center regulation and policy development and ensure ample and ongoing public engagement and participation.

And this ordinance should not preclude any changes or improvements that could come about in response to community input during the moratorium period.

Thank you for your time.

Thank you, Rebecca.

The next public speaker is David Haynes.

Mr.

Haynes.

Go ahead.

Hi, thank you, David Haynes.

I wanted to talk about the parks because Myrtle Edwards Park.

You know, there used to be a path that you could take when you're hiking, walking, or literally sprinting.

If you when you're running through the park, I personally run on soft ground with ankle support, and I used to use Myrtle Edwards Park and then stop off as a pull-up bar.

And I swear it saved me during COVID.

I got in great shape.

But I went over there a while back and they got rusted rope that has blocked off all the grass.

And they got like 75,000 plants.

And yet they didn't put one plant in between the park and the toxic industrial gravel dusted train yard.

And I'm wondering why the parks department didn't emphasize the need to take these beautiful hedgerow bushes and line them all next to each other and create a gigantically beautiful green wall of trees so that we don't have to look at the Godforsaken train yard in the waterfront.

And it's like everybody has to stay on the path of asphalt.

They've heated up that park, and they took away the pull-up bar and the dip bar and the sit-up bars, and they've there was like three pull-up bars, three separate sizes, and they put a concrete heated like blank path.

Not a bike path, but a bike parking lot for seam it that just reflects like from the sun and just burns your eyes.

It sucks.

And it needs to be slightly adjusted so that we can block off the chain link fence that allows the gravel dust to come back into the park and give us a soft path.

It's almost like those people from a long time ago who used to yell at children when you step on the grass.

This is a type of policy.

It's like you can't have hemp fest anymore, and you can't walk on the grass because they've surrounded it with all of these bushes with this ugly rustic.

Thank you, Mr.

Haynes.

Next public speaker will be Lauren Redfield.

Lauren?

Can you hear me?

Yep.

Go ahead.

Good afternoon, Council members.

I am a born and raised Seattle resident of District 6 and a lead organizer of the Washington AI resistant.

I strongly support Cattle City Light's proposed hardload rate policy.

It is one of the strongest utility-centered approaches emerging nationally and represents an important first step towards protecting saddle right pairs.

It also establishes Seattle as a national leader in the state, and I want to commend you for the policy.

I encourage the council to adopt this policy and apply it immediately to any new facility that has not yet secured a binding service agreement.

Existing large customers should also transition into this customer class at the earliest legally available opportunity.

I also urge the council to review this at the foundation, and not the final word on data center policy.

The ongoing moratorium should continue to examine broader issues, including overall climate impact, grid reliability, grid reliability and flexibility, protections against stranded assets, how to balance large lead directed long-term energy planning, water use, land use, labor standards, and how limited clean electricity should be allocated among competing public needs.

Finally, I ask whether any council member would consider sponsoring a simple amendment of legislative intent clarifying that the rate policy does not limit future legislation.

For example, something along the lines of council does not intend for this policy preclude any legislation developers of data through moratorium process.

We expressly reserve the right to strengthen improve or expand the policy following community increase engagement.

That would make it clear that this is an important first step and not the last.

Thank you.

Thank you.

That was the final public speaker.

Oh, that's it?

Oh, we had four.

That was four.

All right.

So with that, there are no additional speakers.

So the public comment period is now closed.

Let's move on to D, which is items of business.

Item one.

We will now move on to our first two items of business.

Will the clerk please read items one and two into the record?

Agenda items one and two.

Resolution 32210 and Council Bill 121231 relating to City Light Department, a resolution adopting a 2027 through 2032 strategic plan for Seattle City Light and endorsing the associated rate path and an ordinance establishing new rate retail rate schedules, establishing new retail rate schedules, a new customer class and conditions of service for data centers whose electricity demand constitutes a new large load, modifying customer charges for service connections, modifying customer eligibility for residential rate assistance, and augmenting the rate stabilization account mechanism.

There will be a briefing and discussion on both items and a vote on resolution 32210.

Thank you.

Do you want to read the record uh into the record the presenters and then I'll go ahead with my script?

Yeah, the presenters today are uh interim general manager and CEO of Seattle City Light, Rob Santov, Angela Bertrand and Christy Granger from Seattle City Light, and additionally Eric McConaughey from Central Staff.

Thank you, Mr.

Clerk.

We have representatives from Seattle City Light that will be presenting for us today.

And my understanding is that we have a 19-page uh PowerPoint, which is you pared it down from 22 from last week, so thank you for that.

19 instead of 22 pages.

We do uh plan on voting on the resolution today, and as you know, we will have a third meeting about the rates ordinance on July 15th, where we will vote.

With that, presenters, will you please introduce yourself and begin your presentation?

Wait, wait, before you do that, let me just say what I have one more thing to say.

Um I understand that the your presentation uh integrates answers to the 13 questions submitted by my colleagues and council members, some on the committee, some not on the committee, um, that were asked to submit questions to Seattle City Light on and uh I think we asked for them on June 17th at our last committee meeting, and um CL City Light responded to those questions and met the deadline, which was yesterday, June 30th.

So this presentation, my understanding will um answer some of those questions, those 13 questions that were put to Seattle City Light, correct?

Yes, okay.

With that, um I'm gonna let you guys go ahead and do your presentation, and then I'll open the floor to my colleagues.

All right, thank you.

Uh good afternoon, Chair Warz and committee members.

I'm Rob Santoff, I'm current general manager and CEO at CIP Seattle City Light.

Uh thank you for inviting us back to continue the discussion on the Seattle City Light's 2027 through 2032 strategic plan and the 2027 to 2028 rate ordinance.

Since our first briefing on June 17th, we've appreciated the thoughtful questions and the council's engagement on our long-term needs.

In the last meeting we covered the utility six-year roadmap for modernizing essential infrastructure, improving system resilience, and increasing operational transparency.

We also had a high-level summary of the review review panels letter and their support of the strategic plan and the rate path.

The review panel letter was transmitted as part of the legislation package.

The companion rate ordinance applies a stable, predictable foundation required to maintain safe, reliable, environmentally responsible operations while supporting necessary capital and operational investments.

As always, always we remain mindful about affordability pressures, and we continue to focus on cost management and on strengthening support for income eligible customers.

In response to the questions we received from the committee for providing clarity around major cost drivers and long-term financial assumptions, strengthening the connection between planned capital investments and anticipated reliability improvements, and expanding details on performance metrics and accountability.

We will also highlight more explicitly how community and customer feedback shaped our provo our proposed investments.

We look forward to supporting the council's continued review and ensuring our long-term direction and transparency is financially sound.

I'll turn it over to Kirsty Granger to present update an updated slide deck.

We also have Andy Strong's Ron Doherty and Angela Bertrand here to answer questions.

Thank you.

Thank you, Rob.

Angela, why don't we move on to the next slide?

Great.

Alright, so this was a slide we presented at our last meeting.

To review the rate ordinance proposes to increase rates by 9.5% for 2027 and again in 2028.

For residential customers, this translates to about $10 a month for an average used customer.

We received some questions from council relating to the non-residential rates, and so we're going to dig into some of those details first.

Moving to the blue section of the table.

So most businesses are served under general service rate classes, which are broken into categories based on the size of the business or the size of their business's energy use.

The rate increases for general service vary a little bit from the 9.5 average.

And so to get into a little bit on what causes this, foundationally.

Can I stop you for one second?

I'm looking at my printout of your PowerPoint.

We have the one from June 17th, and then I have the one that's dated July 1st.

And my page three is not your page three.

My page three in the new printout starts with rate ordinance, not cost allocation or rate design.

Are you using the old one from June 17th?

Thank you, Councilmember.

So I when I was reviewing this deck, slide three felt redundant because it said all the same things as slide two.

So I thought I would save us all some time by just deleting it.

And instead, I'm confusing everyone.

It's it was the same information on slide two that breaks down what the four parts of the rate ordinance are.

Okay, good.

I just want to make sure I had the right.

But thank you for checking in.

Okay, great.

You did.

Everything else is the same.

I just all right.

I just state for the record.

Uh, Councilmember Rivera has just joined us.

Welcome.

Thank you.

Go ahead, Christy.

Thank you.

All right.

Um, so a little bit about rate making.

It's a reminder for everyone listening: City Light is a not-for-profit public utility.

So the way we set rates is that we determine how much revenue we project we need to operate the utility.

And then each rate class is assigned a share of the revenue that we need to collect.

And this is based on an analysis of the cost to serve the customers in that rate class.

And cost of service includes the cost of the electricity a customer consumes, as well as the cost it takes to delivery for to deliver the electricity to the customer, and and then also other things like billing, metering, and customer service.

I should note, Councilman Rivera, this is page nine, even though she says three.

You know, okay.

Yeah, thank you.

Go ahead, we can bounce back and forth, but I just want because I think the viewing public has the original that you that we posted.

Okay.

Okay.

Okay, thank you.

See, so where were we?

Um, so for the cost of electricity, we want everybody to know that the you know the cost of the electricity that you consume for any customer, be it a resident or a small business or a big business, the price for the electricity is the same, but there is a lot of variation in the cost of delivery, and there's also variation in load profiles and the cost to serve those load profiles.

And this is what's driving the high demand rate increase to be lower than average.

So the high demand rate class only has 11 customers in it, and a good number of those customers are industrial, and industrial loads tend to be more flat and constant than a typical load, which will have a lot of peaks and valleys that vary by season, time of day, and with weather.

So the high demand customers' seasonal consumption patterns lowered their assigned energy cost relative to the other general service customers, and that's why their rate increase is lower than average for this biennium.

Did anybody have any?

That's that was the first question.

Hopefully, we're we're starting out with the really technical stuff.

Um, that's so that's the general service.

We got also got a question about the downtown network, so this is the green part of the table.

The downtown network is a rate class for medium and large businesses that are located in the downtown core.

So there's two kinds of electric service that Seattle City Light provides.

There's radio service and network.

Most of us have radio service, and this is where every customer is fed with one feeder.

In network service, the customer is getting electricity from two or more feeders, and so what this means is that if one of them fails for any reason, there's a backup, and that customer's power stays on.

So this means that in the downtown network, those customers have a super reliable service that we would describe as like a premium compared to what most of us have.

The cost of this service is higher, and downtown network customers pay rates that are on average about 20% higher than the general service rates.

Now for 2027 and 2028, the downtown network increases you'll see on the table are a little bit lower than average.

And this is again due to cost of service.

So within the downtown network area, when we back we went back and reviewed our financial records for the cost to serve the downtown network, what we saw is that the increase in cost for maintenance and capital investment within the network wasn't rising as quickly as it was for other parts of the service territory.

And that's why those rates are increasing less quickly than for other customers, but I want to emphasize that overall downtown network rates are still higher than everyone else's.

Hey Chrissy, can I are you done with downtown network?

I am okay.

We have a question, but let me just say this.

So for those of you watching, the PowerPoint says three, but what it was posted online is page nine, and Councilman Rivera has a question about downtown network, correct?

Thank you.

Yes.

Thank you, Chair.

And thank you, Kirstie.

I I will say, I know that this is technical, it's very technical, but for the average person watching and looking at this slide, you know, it does look like we're charging our residential customers more than our downtown network customers.

And so I know you just finished explaining this, but um do you mind taking another shot at um or another pass at explaining why that is because then I heard you say actually downtown network pays more, but it's not what it's shown here.

So I just want to make sure I understand what you were explaining.

Thank you.

I'll I'll give I'll give it another shot.

And I acknowledge this is super technical stuff.

Um, so the rate this this table shows rate increases, and we're talking about how the rates are increasing.

So the but the rates that the customers are paying also have are different.

So the downtown network rates are higher than general service rates and other rates.

The increases are a little bit lower for these two years because of how the cost of service has changed over the last two years.

Does that help?

Yes, are you saying that because for instance we know downtown there's more vacancy, and so maybe they're not consuming as much.

Is that why?

When you say it's a great question, they're still paying more downtown, but the rates don't look like they're paying more.

Yeah, um, no, I just I mean, if you pull up like our rate schedules, if you were to look at the per kilowatt hour rates for downtown network, the number will be bigger.

Um, I don't think it is due to vacancies.

Um, it's it's more to do with the downtown core is really dense and it's all underground, and and so the just the the work that we do on that system is really different than the work that we're doing out in um neighborhoods that are served by poles and wires.

So we have a slide, and we track those costs separately than we do for the rest of the system.

Oh, okay.

Yeah, I just don't know.

From this slide, it looks like we're charging our residential customers more than our commercial customers, and I guess that's what I'm trying to get to, and I I'm sorry, I'm not I don't have clarity on that.

Either that's true or it's not, and if it's not true, then the slide is misleading.

We are increasing residential rates by 9.5%, and for the commercial customers, the rate increases vary from mid-7% to a little bit higher, I think, in some cases.

Let me this table is rate increases.

So two things.

Let me go to, if you don't mind, Council Member Kettle.

Um, let me go to Eric McConaughey who can answer some of your question, Councilmember Rivera, and then we'll go to Councilmember McKettle.

Eric?

Hello, council members, uh Eric McConaughey and the Council Central Staff.

I just wanted to underline what Kirsty was pointing out that what we see on this table are rate increases.

So the change from what's charged now by City Lights to what will be charged in the future, the actual change in the rates for each of these kinds of customers.

And each customer has their own rate class.

So uh based on the cost to service each one of these kinds of customers, City Light has figured out, excuse me, how much more money per kilowatt those those particular customers should pay in the future, and they vary.

The actual amount of money being paid per kilowatt varies among these customers, and the downtown network customers actually pay more because they have a premium service.

So this is just kind of repeating, maybe a slightly different word of what Kiercy said, but trying to underline that.

I hope that's helpful.

Right.

I and my understanding is it's because it's we have all these different classes, you know, general downtown business, and soon-to-be a data system.

Um, this is the increase, but they're already paying more baseline, correct?

Downtown network is already paying more than your general service.

Yes, yeah, and that's because by statute, we created classes to make downtown street lights big business and now data centers to pay more.

Yeah, the down.

I mean, the downtown, if you think about what it looks like, you know, everything is underground, everything is redundant.

It's a it's a different system that costs more to install than in other parts of the city.

So we we charge more for that.

Are you okay?

Yes, I think in general, downtown pays more.

It's just their increase is not gonna go as high, but in general, they're paying more per hour than the residential customers.

So don't go by the fact that they it looks like their rate in their rate, not it doesn't look like their rate increases less than the residential, but they pay more per hour for their electricity than the residential folks do.

Correct.

So it's not that we're giving the downtown core, the commercial, a break, a more of a break.

They're paying more.

Exactly.

Thank you.

Overall, thank you, Q.

Thank you, Councilman Rivera.

Casper Kettle.

I don't see you in my thank you, Chair.

I was just gonna know, yes, for 2728, the 7% and 8% is on a higher number other than the nine and a half um for the general service.

And it's it's highlighted in their the point that the premium service carries a higher rate, downtown network customers pay rates that are 20% higher than other customers.

And to the point that was noted in terms of maintenance and the like, um, the maintenance expenses and capital investments for network systems have risen at a lower rate than those for non-network areas, um, which is something in terms of the above ground point as opposed to the underground point, which is really under uh really important.

I also wanted to speak up too because the downtown piece serves, you know, it's like a heart for so many um areas for the city and businesses and business classes too.

So, for example, we're at Tech City, and you mentioned uh data centers, but even you know, more sensitive is not just the tech but biotech.

Uh so our we have a growing uh biotech um here in Seattle, trying to catch up to Boston and San Diego, and as you can imagine, the labs and the like, they're really dependent on stable uh power.

And so having this downtown um network is vital for classes of in you know business like the biotech world.

Um, something that I've seen in my and uh when I bounce around at various uh companies and you know getting briefings and presentations and and walkabouts uh in their area.

So uh I just wanted to emphasize that point and also introduce because I think a lot of people don't realize you know, biotech is a very big in Seattle, but it's also very sensitive to electrical power.

Uh so I just wanted to throw that in.

Thank you, Chair.

Anything else you want to throw in, Casper McKettle?

You good?

No.

All right.

I'm always willing to do another first pitch, but no, I don't know what else to go in.

Thank you.

Uh go ahead, Kirsty.

We're tracking along here with your PowerPoint.

This is this is great, because that's just tell us which page.

We're we're gonna see one more topic on this one.

So it's uh we also got a question about streetlight rates.

Yep.

So the street light rate increase is much higher than average, and this has to do with higher costs associated with maintaining street lights.

We received a question on um what capital projects are are baked into that, and then how are we going to control future costs?

I think this might be uh a West Seattle Bridge related question.

Uh, Saka had five questions, so I hope you you answered all of them.

I I think we we answered all the questions, but um so you know we could do a whole separate briefing on on uh streetlights, but there are some specific capital improvements planned.

Um there's one I think in North Seattle between Meridian and Fifth Avenue, not West Seattle.

Um we're also doing some upgrades to our monitoring technology because we know that one of the challenges is in monitoring when the outages go out and being able to address them quickly, so doing some work there, and then also there's some planned work on highway under deck lighting, um, which is going to contribute to improve public safety as well.

But we want to stress that a the major driver in street light rates isn't so much capital projects as it is maintenance and replacing things that are getting broken and vandalized, and um, and that that's really going to be key for controlling our future costs is figuring out how we can mitigate wire theft.

This is going to be critical.

I mean, we we're also going to do all the work we can around prioritization and being responsive to outages, streamlining our operations.

But if if we can't stop um people from vandalizing the street lights, that this is going to be very, very difficult.

So we're looking at strategies to make the um protect the wire with theft-resistant enclosures.

We're looking at potentially are there places where we can use cheaper um like aluminum-based parts instead of copper to make them less attractive.

Um and then we're also working with uh I think we're looking looking at possibilities where what we can do too to also just make theft less attractive in in resale of scrap metal.

That's a bit more on street lights.

Okay.

Okay, keep going.

All right.

So I I did reorder the slides because I really wanted to tackle that first because I felt like that was going to be the media subject.

So I this is just a four.

Hi, no, I'm sorry.

Okay, so this it's somewhere in there.

Um, this is just a slide on bill impacts for small and medium businesses.

So we got a question, you know.

Have we done some analysis on how these increases will affect small and medium customers?

So these are some example businesses, and you know, there's a great variety in uh businesses, but for example, a small office, you know, they might have a bill that's about 200 dollars, and they would see an increase of like 16, and then we have some larger examples.

Um, the apartment complex would be like the common area of a big apartment complex, they have a higher bill and they might see increases in a couple thousand dollar range.

And you know, we recognize that for businesses, electricity is is just one of one cost in the context of a lot of higher operating costs, and we're gonna talk a little bit later about um opportunities for savings and and some other things related to businesses.

Okay, so that's your page four, which is our page 11, but go ahead.

Okay, um, and so now we're gonna talk a little bit about rate increases.

The same page.

Oh, good.

We might be.

We'll see.

Okay, this is an adventure, like one of those choose your own adventure books where we switch around.

Um, this is a review from the last meeting.

We walked everyone through five key factors driving the need for higher rates.

And um, we got a follow-up question on cost drivers and digging a little bit more into examples of deferred maintenance and what's going on in the area in some areas.

So, consumption or the rising demand for electricity is uh a big factor.

City lights load is projected to grow about 20%, our peak load, and we know that we're going to need to procure new power and transmission resources, we're going to need to upgrade transformers, we're going to need to do work on our infrastructure to expand system capacity.

And all together these investments in new power supply, transmission, as well as leaning into technology and demand side solutions with our customers, is contributing about one third of the rate increase.

Another aspect is generation.

So part of the rate increase is coming from costs associated with the new Skagit license, which is going to total four billion dollars over the next three decades.

And then there's a couple of key civil infrastructure projects that we have in our uh planned in our strategic plan.

At the Skagget, there's Gorge Powerhouse Hydroelectric Unit rebuilds, and these are a big priority.

And then two civil infrastructure projects, one at Gorge, which is a seismic project that relates to the superstructure, which is going to protect it from potential earthquakes, as well as work on the four-bay bridge, which is like a um it's a bridge out at boundary, but it's it's in bad shape right now, and we can't drive heavy equipment on it, and so there's a big project to improve that as well.

So we are on five, and last week, two weeks ago, it was page 12 because I'm looking at my old notes from your last PowerPoint.

Right, but we're on five now, so we're on 12.

And what number are you on here?

Aging grid or technology?

We're just talking about cost drivers and deferred maintenance in the areas of consumption generation, transmission, and distribution.

Okay, um, did you talk about technology and inflation yet?

Because I'm not really following where you're at.

Oh, sorry.

No, it's that's great.

So, technology is all okay, so we talked about power supply costs, talk about aging grid, which is going to include both um infrastructure like the distribution infrastructure as well as the generation infrastructure and some pretty big projects out at Skagit and Boundary Dams.

Right, I got that down here too.

Okay.

So we're good there, and then um, we're going to need to invest in technology.

Um, and I think we got a question coming up about how that's going to help us manage peaks and avoid infrastructure expansions.

We talked a little bit about the last meeting about derms as well, which is going to be a really important technology investment that's going to help us have like a two-way power grid where if customers want to generate their own power or use power that the grid can accommodate the power flowing both ways.

Right.

That's what we were talking about Pinehurst and Queen Anne and outtages.

Exactly.

This time I know you updated your PowerPoint to say technology deficit, whereas last time it was just technology, you're talking about texting customers.

That's right, yeah.

Um, we we do.

We are behind.

I mean, this is exciting technology, but we also want to acknowledge that compared to a lot of utilities around the country, we're actually a little bit behind in this space.

Well, we do get texts from you guys when stuff when power goes out.

Don't we?

Yeah, we get Texas when power goes out.

Oh, it's because I'm the chair.

Oh, never mind.

Sorry.

Well, Councilmember Rostral's getting some.

I don't I don't know that that's coming from technology.

I think that's coming from people.

No, it's coming from Sales City Light.

Oh no, but I mean it's we we aren't broadly texting everybody.

I think that's coming from somebody here to somebody there.

Yeah, okay.

But but yeah, I think that for if anybody is a Puget Sound Energy customer, like I think that they have auto texts.

Like when the power goes out, it's like, hey, we know your power's out, and we estimate that it's coming back on in this many hours, and that's something that we don't have the capability to do yet.

Okay, so are you gonna go into inflation now?

Because I remember you talked about it not keeping pace in the 40% and all that other stuff.

Okay, let's do that.

That's um uh no, that's that's exactly you got it exactly it.

Um, is that in inflation is a big factor.

And you know, so we're as we're talking about all of these other things.

Inflation's accounting for about 40% of the rate increases when you combine it with um the liquidity and taxes and everything else that goes along with being a bigger operation.

All right.

Okay, so if we go to six, are we on the same page on six?

No, we're not okay.

Hold on, let us okay.

We're on page four.

You and I, Customer Rivera, our team, we have four.

Yep, Kirsty has four.

Yeah, we were trying to use some of the same visuals while we talk about some of the questions that we received from you all, and so yeah, and just figuring out how to walk through them in a way where it didn't feel like we were skipping all over the place.

Okay, now I'm regretting asking for page numbers, because what I really meant was page numbers that actually go with the PowerPoint.

That's okay.

I get that.

You're lucky I'm a nerd, and I went back and looked at the old presentation and I cross-referenced them, but that's okay.

We're good.

Yeah, go ahead.

So I don't I don't know who asked this question, but it's a great one, which was what would it take for rates to increase at lower rates in the future?

Right.

Um, which is a absolutely and so you know, I just want to acknowledge that there is a lot of uncertainty in the future.

Um I cannot stress how that that Seattle City Light is in a place, and and electric utility in general, we're in a place where there's it's really hard to know what's going to happen in the next two years and very hard in the next six.

Where um we are feeling as we were talking about, we're feeling the impacts of inflation, and um we don't know where the future is going to go with the prices of raw materials with taxes, um trade situation with Canada.

A lot of our materials come from from the north.

Um, so where those prices for those materials will go is going to be a big factor in where rates will need to be.

Um weather is another one.

It good hydro conditions help us, mild weather helps us keep our costs of service low.

On the flip side, um extreme weather events and wildfires are big financial risks for us.

Okay, something else that's going on right now is that wholesale markets are evolving and we have some financial exposure there.

If it goes well, if these new regional markets turn out to be beneficial and contribute to better regional coordination, this could help us keep costs low.

And then finally, I think the single biggest uncertainty that's going to impact whether rates need to be on the higher or low side really has to do with how the demand for electricity is going to grow.

This relates to the data centers, it relates to you know, some major electrification projects that are coming down the pike.

So as we have these big new commercial loads come on, it's hard to know exactly when they're coming, and in some cases it's hard to know exactly where in our service territory they're going to be.

So, you know, if these loads materialize in a way where we can serve them efficiently, it could be beneficial for everyone, but it could also go the other way.

And so load growth is really the single biggest um driver, I think, in in where we're going to land with respect to rates having to go higher or lower.

Okay.

So we are on page seven.

Let's see your next slide.

What our what ours is the next thing we were hoping to talk about is managing peaks in demand.

Okay, well, page eight.

It's page eight, okay.

Page eight.

Great.

So we are on your page seven.

We're on page eight.

Go ahead.

Perfect.

Thank you.

So we got a question about what plans does City Light have for managing peak demand issues, which is a great question.

We talked about how our peak load is expected to grow by 20%.

Um, and that's going to be driving a lot of these investments and power transmission and infrastructure.

So, what can we do to mitigate those peaks?

And we've got a little graph on here that illustrates what City Light's load looks like on a really cold winter day.

This happens to be January 12th, 2024.

I guess that was a cold day.

And so this is a 24-hour chart, and the orange line shows our system load.

And so, you know, it creeps up in the morning, and then it peaks in the late afternoon evening.

And that that little peak there, that's the part that stresses our system, and that's where the opportunity is to shave our our load and and keep our costs lower.

I like this line.

So cool.

This is new.

So some um, yeah, and you know, and just we do have a summer peak as well, but it is not as acute as our winter peak.

Seattle is a winter peaking utility, and so that's really what we're focused on when we're thinking about reliability and you know preventing blackouts and and that sort of thing is that winter peak.

Okay.

So our number one strategy is the one that we've been doing for a hundred years, which is to leverage our hydro flexibility.

This gadget project is um super important, the the storage that we have behind Ross Dam.

And then with our new Bonneville contract that's starting in October of 2028, we are also going to gain some flexibility from that contract because we're going to go with a different product, and that's also going to help us flex to meet peak demand.

Also, as we're out looking for those new resources to serve the future, we're going to be keeping in mind their ability to help meet these peaks.

And some resources might be better suited for that than others.

Okay, so I already know that your page eight is different than ours.

No.

Well, but then the other part is is the is the demand response.

And so we're just to um to say that you know supply side is how we've done it in the past.

In the future, City Light's also going to have to lean into working with our customers to shave our peaks.

So this is going to be time of use rates, which are now available as an option to anyone who would like to enroll.

Um we're working with some large industrial customers to do curtailment, which means that you know, if we're in a peak event, we'll we could ask them to curtail their use.

And as a reminder, in our new data center rate, we're going to require data centers to curtail so that we're going to make them help us with these peaks.

Hey Kirsty, before you go into Durms.

Are you done with the okay?

Before you go there, Councillor McKennel had his hands up.

You know what, Councillor McKell, when you put your hand up, it blends into your bookcase.

That's why I can't see it.

But I thought it went down again.

I was just gonna uh chair, thank you for I guess recognizing me.

I was just gonna, you know, working with the community, like with this side, this case, the industrial is key.

I just had a great tour of the new core um steel plant, and uh, you know, I know they're they're a very large, the largest, uh, you know, and and they're willing to work, and you know, that that positive engagement from the community back with City Light, you know, in this case the business community and large industrial community is really what's needed, you know, this partnership um to work and these these loads because you know we are changing.

I I know we're a winter, but you know, with more and more electrification, more and more AC units we're gonna be adjusting as well.

And uh I just wanted to give a shout out uh to that customer demand response effort uh that's ongoing.

Yeah, we've done that new courtour, it's pretty fun.

I think we've all done it.

Thank you.

Go ahead, Christy.

Oh, and and then finally Durms, which again comes back to the technology, and we've talked about that earlier that this is important for demand response as well.

So that's that's our our some a little a few of our strategies that we're going to be leaning into to to work on managing our peaks.

Okay, okay we're cautiously waiting for eight.

Okay, so this is your eight.

Is this a new one for us?

Is this six?

That was what I was wondering.

This is we were doing a lot of this right before.

Your eight R6, it's like bingo.

Okay.

Okay.

Wait, wait, hold up.

Councilmember Saka, did you want to ask your question now, sir?

Yes.

Yeah, thank you.

Thank you, Madam Chair.

If I may.

All right.

Uh well, appreciate the presentation so far.

First off, shout out to New Core Steel, right here in West Seattle, great industrial customer, and I appreciate the the partnership uh with the City Light team and and you know, customers like new core across the city.

Uh so they do very important work.

Um just want to dig in a little more onto the uh what what was noted a stat was noted earlier a moment ago about the 40 percent increase um sort of being driven by inflation uh and affordability is obviously top of mind for a lot of our constituents, residents and and customers of City Light here.

Um so just well, that's a better understanding why that figure uh is so significant.

The 40 percent figure um tied to to inflation is so significant compared to other drivers of inflation oh yeah and i i hope that everybody caught i'm not saying inflation went up by 40 percent i'm saying inflation is accounting for 40 percent of the rate increase so 40 percent of the 9.5 if that makes sense but but that's is that the one and then inflation is going up significantly um i just wanted to make sure which to which number is that the number you were referring to council member yeah yeah you said it but you didn't put it in your slide last week or this week but you said last time 40 percent for inflation it accounts for that um and and it is yeah it is significant um did you have a question about what's driving that like for to break it down no no uh all good uh okay yeah i'm digging into some of your your responses to some of your written questions so all good for now thank you great thank you for your two council membersaka you submitted five so thank you for that very diligent I suppose thank you manager I like that about you thank you Councilmember Saka go ahead Christy what page are we on we're on eight you're eight or six talk a little bit about underground infrastructure oh you're gonna get a lot of ones about these council member kettle's gonna come in and I this this might again this is it it is a factor in rates we got some questions about it and it's possible that this would be um another a separate briefing so there is significant investment in infrastructure baked into our rate proposal um we know that we have work to do around replacing direct buried underground cable we have 300 approximately 300 miles of failing cable out there that's causing um outages in some neighborhoods and the replacement cost for that underground cable will be very significant.

We are aware that there's a lot of questions uh related to cost and equity around direct buried underground lines and the you know the question that we got was around how are we prioritizing these and balancing um the need to replace these lines based on equity and will the cost of replacing these lines affect residential rates so where did you come up with two billion if you don't have an answer as as you can see um in the photo when when we're doing underground ducty nice to you to jump in on in there but okay perfect yeah I wanted to come in because this this is a tough question and and I suppose I've I've got the most pertinent information on it costs for direct buried underground cabling program is about 6.3 million dollars linear mile and you can see why this is a typical photo in a typical neighborhood of what it would uh be like to do this type of construction and infrastructure replacement so um wait you said six point waiting Andy hold up you said it's six point three million that's what you're linear mile and you're talking about queen Anne uh talking about neighborhoods in general Queen Anne uh might even come in more than this because of the complexity of the underground infrastructure there okay I need you to hey Andy I need you either to um enunciate a little bit better or move your mic in a little bit more because we're you're kind of cutting out thank you thank you.

Okay so we we asked about the two billion you explained it all right Andy do you want uh I well I can you talked a little bit about um the direct buried weed to cover priorities um I'm reading Andy's answer now so please feel free to jump in and do your own answer but you know we're free to jump in.

Yeah um do you need more on the direct period underground cable or should I continue on the other projects?

I think you've answered my question.

Oh, great.

Well, and I think that the question that we got in in the the written responses were um how do you prioritize it?

And so, you know, we're looking at are there critical services located in those areas like hospitals, schools.

Um, you know, and we're also monitoring the frequency and the duration of the outages, but we acknowledge that um some prioritization is important, but but really what we know is that all of the direct buried cable, regardless of the location, needs to be replaced.

That's causing out, yes.

Yeah, I think the near-term impacts will be modest because it's going to take us some time to ramp up this effort.

Um, but there will be significant rate impacts, and there are a lot of questions about how we assign the cost, how we allocate the cost of this very expensive direct buried cable replacement amongst ratepayers, and um the mayor has asked City Light to analyze some options for how equitably and progressively we might allocate these costs, and we plan to do that work later this year and bring back some options and recommendations in Q3 and Q4 of this year.

Right, then that was question number six that council member Lynn asked of you.

You rewrite from it, so that's yeah, so that was the question he asked about the equity issue in the uh to the direct buried replacement priority based on number of critical services.

Okay, I just got it.

Councilmember Rivera.

Thank you, Chair.

I just to confirm, um, because I've had neighborhoods in the D4 with underground um cables that have had these power outages.

My understanding, so this is more confirmation, Andy and and Kirsty, is um when you're replacing this when you say 300 miles of failing cable needs to be replaced, you are replacing them in a fashion where they're easier to locate where the um outage is stemming from and to replace, is my understanding from conversations with City Light earlier last year at some time.

Um, because now the way that it's the replacement is being laid, there'll be some, I'm calling it a box.

It's not called the box, it's called a terminal or something.

Um, so all to say that then moving once these are replaced moving forward, it'll be easier to locate where the source of the outages and be able to replace it or address it, correct?

Very much so.

Um with direct buried underground cable, we lack the ability to be able to um specifically locate the uh issue of the outage and then be able to do it other than uh to repair it other than directly dig into the sidewalk, the street, or perhaps a right-away where the cable is buried now.

In the future, we'll be able to open a vault, uh, pull out the bad section of cable, uh, replace it very quickly, uh the whole length, and be much more secure in knowing that we found the issue and have fixed it um you know permanently.

Thank you, Andy.

Are you you done?

No, thank you, Andrew Andy.

I think I called it a terminal, but it's a vault.

Correct, but but I know what you're saying.

Thank you.

Thank you, Andy.

Go ahead, Councilmember Kettle.

Thank you, Chair.

I just wanted to um say this is very important for the district and for the city, because as you're hearing, this is all over the city.

This is not just one area, and there's been a few areas that have already been addressed and they're kind of dispersed.

Um, as you're hearing D4, um, uh I know Pinehurst D5's uh severely impacted too.

So this is the citywide issue, and I think we need to to do this, but it's also a cautionary tale in the sense that um this should have been started 15 years ago.

And if it was then you know, these costs would be a lot lower.

You know, the punting down the road philosophy of governance uh is being shown here to be a major mistake and costing us, in this case around two billion dollars.

This could have been initiated again a decade and a half ago.

Um, but it wasn't.

Now we have to, and here we are.

And I it's a cautionary tale, and I'm just I'm just stating that out loud and for the record.

Thank you.

Thanks, Chair.

All right, Chris.

Do you want to keep walking us through this?

Um yeah, I mean, well, there weren't any questions specifically on these, but other aspects of investing in infrastructure include polls, transformers, so the overhead infrastructure.

Talked a little bit about investment up at the um Skagget and Boundary Dams.

And then wildfire mitigation is another thing that we're thinking a lot about.

City Light does have transmission lines that run through forested areas, and wildfires are becoming more common, and there have been some electric utilities for whom this has been a very serious issue.

So we want to make sure that we're being proactive about this very real enterprise risk.

Okay.

All right.

So page nine is our page is page seven.

So your page nine is our page seven.

Okay.

All right.

Um, and so we we got a question that's sort of tangentially related to rates, which has to do with um undergrounding of lines for don't go anywhere, Andy.

Um, undergrounding of lines for developments with four to six units or more.

And how does this affect rates for residential customers or for developers?

So, you know, we acknowledge that you know building anything in an already dense city is challenging and there's a lot of multifamily development going on.

City Light has a policy where we require the service connection, which is the you know, which goes from the the pole or whatever to the the building, or we call it a service drop sometimes to be underground if it's going to be a four-plex to sixplex.

And this is for safety reasons.

Um a standard utility pool can't handle the weight of the conductor that you need to serve four to six households.

And you know, we we have done our research and we haven't found a practical engineering solution to avoid this.

It is costly, as we just talked about on the last slide.

Anytime that you're working underground, it is going to be costly.

And so, you know, we understand that this is a significant cost for developers.

And at the same time, City Light's overarching um philosophy is that we are going to develop policies and fees where developers must pay their fair share of the cost of the development because the only other option would be to pass those costs to residents of businesses, and so we are um setting up all of our our fees for service connections with the goal of having the developer pay the full cost of that private development.

Right.

That is page that's question seven from Councilmember Lynn.

Yes.

Okay.

I should have just followed the questions with your PowerPoint.

I see how it's flowing now.

I did not realize that, but go ahead.

Where are we at now?

Right?

All right, okay.

So the next question, I think we were on to questions 12 and 13.

Okay, wait, hold up because we got a different one.

You this is your page 10.

Yeah.

What is that?

Ours is 13.

Okay, thank you.

Okay.

Wait, wait, wait.

Wait, who?

Oh, okay.

Now, we are on page 13 year on your page 10.

We're good, okay.

Everybody's good.

Okay, and then we're on question 12, which is how is City Light communicating these changes to residential and business customers?

Oh, there it is.

Council Member Saka's question.

Good question.

Okay, this is this is fun.

We weren't told who answer asked the questions, and so they were all blinded for us, so now we get to the match them up.

So I want to stress our our goal here is full transparency.

Our strategic plan has a big appendix, and we've been communicating broadly to customers over the past two years.

Um, you know, we haven't had a specific rate increase, but our leadership has been talking openly about the need for significant rate increases in the news, in regional forums, um, with community organizations.

And as we move towards the rates taking effect on January 1, we want to use every channel that we have at our disposal.

This includes customer newsletters, online channels, news outlets to get the word out about these upcoming increases because we anticipate that they're going to affect every resident and every business.

And so, you know, as we need to raise rates, we want to bring along customers on this process.

Uh we want everyone to be able to access the electricity, but at the same time, you know, we can't take it for granted because it it really does have a real price for our planet.

And brings us to question 13.

What, if any new or expanded programs will help customers reduce consumption to offset higher rates?

So that's a perfect.

As we talk about the need for higher rates, we absolutely want to be connecting customers with opportunities for savings.

We have a new online platform called Energy Insights that uses your meter data to give you ideas for how you can save on your bills.

Time of use rates might be a good option if you have an electric vehicle or you have a way that you can shift some of your electricity use to night time.

This is a way that you could save on your bills, and this is also open to businesses.

And then we also have a new one for multifamily homes as well.

And so we encourage you to check out our website, we've got a lot of information there on opportunities to save.

That was Council Member Saka's question too, number 13.

Council Saka's just killing it over here.

All right.

So you are on your 11, and what page is ours?

Oh.

Rates and other.

Oh, 12.

Okay.

So we have page 12 in front of us, and you have page 11 on the screen.

Okay.

You know, and this isn't in response to any particular question, but we didn't get a chance to talk about this last year.

And so we were thinking about businesses and how our rate increases are going to impact them.

We just wanted to show that City Light does still provide good value compared to a lot of major cities across the country.

And what this means for businesses is that even with higher rates, Seattle does still provide very competitive energy costs when compared to other places that a business might locate.

And this really reflects the value of public power as well as investments that past Seattle leaders have made.

So, you know, past Seattle leaders have put the can down the road in some cases, council member.

And in other cases, we have leaned into some investments that we are benefiting from today, which um gives us pretty good energy rates.

Yeah, this is a great map because I think this question came up like how do we rate with other cities with our hydro non-carbon energy fuel, whatever we are doing, green energy, right?

Yes, so fuel, our car reducing our carbon footprint, all that good stuff.

All right.

Yeah, so we know Seattle should be proud.

We are, you know, net zero, we are green and and relatively affordable.

Okay.

So okay, so we see that's and this is just our closing slide.

This again that um 14.

14.

That we also have programs to help residents.

Um we have a utility discount program.

We're going to be expanding the eligibility, so we encourage everyone to, if they are struggling with their electric bills to check if they qualify.

For customers who are behind on their bills, we have programs and can help you access federal or state funds as well as budget billing programs which help keep a customer's bill stable month to month.

Yeah, thank you for that.

We went through this with when council members um Strauss was here on the EDP and the slowering, lowering the AMI.

So exactly.

Well done.

Good job.

Thank you for this slide.

All right, and that brings us to the ends of our slides, and so we'd be happy to answer any other questions that you have.

Um, and we thank you for your time today.

Thank you, Kirsty.

Thank you, Andy.

Is there I'm looking at my screen here, and I do not see, I think.

Oh, nope.

Here we go.

Councilman Kendall.

Uh thank you, Chair.

I just really quickly wanted to say thank you for the uh the questions response document.

Um, because this is gonna help me related to directory cable and some of the other challenges issues that reside in my district.

So I just wanted to give a quick shout out.

And um and I should say uh with the uh the moving slides, it's uh it kept us on our toes at the end of the day.

Uh all of us, and so uh in a way, and not to share too much, the not seen before, so uh so thank you.

Well, you know, of the 13 questions, um, five of them came from Council Member Saka, and three came from Councilmember Lynn, and we had one from Councilmember Strauss, and we also had a count a question from Customer Strauss and Lynn.

But my point is we also had them from Eric McConaughey and Paul Policy Paul, who on the floor were getting back feedback from the last uh committee meeting we had.

So we so I would say that one, two, three.

The first three questions were a conglomerate of folks in questions that were raised, and then the rest were all um either committee members or other council members who are watching and had questions.

And so thank you, Councilmember Kettle for your right.

We were up here.

Me and Councilmember Rivera playing um PowerPoint bingo.

But I think I think we got it all.

We got all the pictures, we got the slides, we got it right.

So thank you, Seattle City Light.

And so, with that, if there aren't any more questions, is there anything else from my colleagues?

Okay, I'm not seeing anything, so are we okay to go to a vote?

All right, I think we are okay.

So I'm gonna go ahead and move that the committee recommends passage of resolution three two two one zero.

Is there a second?

Second, thank you.

It's been moved and seconded to remake recommend passage of the bill.

Any further comments?

I'm not seeing any.

Uh, will the clerk please call the roll on the passage of the bill?

Councilmember Saka.

Aye.

Councilmember Rivera.

Aye.

Vice Chair Kettle.

Aye.

Chair Warren's.

Aye.

Chair, there are four votes in favor and zero opposed.

Thank you.

The motion carries resolution three two two one zero.

Will be sent to the July 7th full city council meeting.

Okay, let's move on to since we did two and three together.

Let's move on to item three, which will require a vote.

Um, not required, but I'm gonna ask for one.

Will the clerk please read item three into the record?

Agenda item three, council bill one two one two four one, an ordinance relating to the city light department authorizing the department to enter into long-term agreements for the acquisition of electric power.

There will be a briefing discussion and vote.

Presenters are interim GM and CEO Rob Santoff and Shabon Dodry from Seattle City Light and Eric McConaughey.

All right, so we have um we have a and I'm hoping now that this PowerPoint matches our PowerPoint.

It's eight pages, and um we looks like we have some new folks, and I'll let you introduce yourself in a moment, but let me just review that we have a PowerPoint, and also we got the summary in fiscal note by Jeff Wolf.

Is Jeff on the call?

No.

Is he nope?

Okay, well, I did learn from the summary and fiscal note that 240 months equals 20 years.

So with that, um, I'm gonna let Seattle City Light take it from here.

All right, thank you, Chair Warez.

Uh, thank you, committee members.

I'm Rob Santhoff, internal manager and CEO of Seattle City Light.

Uh, appreciate the opportunity to present the power purchase agreement ordinance today.

City Light's 2026 integrated resources plan adopted by City Council shows electricity demand growing rapidly over the next several years.

Uh the rapid growth is driven mostly by vehicle and building electrification.

This requires City Light to acquire more than 1700 megawatts of new energy resources in the next decade.

The renewable energy market is extremely competitive.

Utilities and large technology companies are moving quickly to secure long-term clean energy projects, often before they are built, which limits the availability and raises the prices under the current Seattle municipal code.

City Light can negotiate and sign contracts for up to 60 months without explicit approval from city council.

That restriction makes it difficult to secure long-term cost-effective renewable power today's um highly competitive market.

This ordinance update this ordinate updates the Seattle municipal code to allow City Light flexible flexibility to negotiate and sign agreements for up to 240 months of renewable energy transmission attributes and ancillary services needed to meet City Light's growing electrical load.

You will hear from Sioban Doherty City Light's Power Supply Officer to present our request for expanded authority to strengthen our negotiation position and reduce dependency on volatile short-term market purchases.

Thank you, Siobhan.

Great, thank you, Rob.

Good afternoon, Chair Juarez and committee members.

Thank you for the opportunity to present today.

As Rob mentioned, we're requesting approval to provide City Light with the authority to meet our long-term planning needs by executing par purchase agreements up to a term of 240 months.

Which is 20 years.

20 years because Amazon and other folks keep outbidding us, correct?

Yep.

Yeah.

So even though we're not, we have a data center moratorium, even though we have our data center load policy, we're going to be competing with technology and data center companies as well as other utilities for resources.

So we'll wait for that exciting info on page six.

Okay.

These are all in order as you guys have.

I didn't.

Okay, great.

Go ahead, Siobhan.

Every two years, City Light prepares what's called an integrated resource plan or an IRP.

And the IRP looks out for 20 years and looks at what is our load forecast and what resources are we going to need to meet that load forecast.

So this slide is showing the load forecast, how much energy use we think we're going to need out through the next 20 years.

And this is what we used in our 2026 IRP, which was just passed by council recently.

We're starting to experience increasing energy demand, and we're forecasting that this is going to continue.

This is related both to economic growth as well as transportation and building electrification.

This chart is showing both our actual historical load as well as our forecast load.

On the horizontal access, we have years, and then the vertical access is average megawatts for energy average annual energy and then megawatts for peak energy.

The solid lines on the left are historical actual loads, and then the dotted lines are the forecasted load.

The lower line shows our annual average loads.

We take up how much we used across the entire year and divide it by the number of hours in the year.

Historically, our load has been relatively flat.

We've done aggressive investments in energy efficiency.

So we've kept that load flat even as we've seen significant growth throughout Seattle.

The upper line is our annual peak load.

This is during each year, what is the highest usage of energy in any one hour?

And we are starting to see this increasing.

In December 2022, we reached the highest peak load that we'd seen in 20 years.

And then in January 2024, just a little over a year later, we saw that peak load 100 megawatts greater.

This is being driven by volatile winter weather events.

Our load forecast is showing a steady increase.

That's that lower dotted line.

The upper dotted line is that peak load increase, and we're seeing that growing faster.

The arrows on the right side are showing what is driving that.

So new housing, transportation electrification, as well as building electrification.

Data centers are providing a small amount of that, but it's not a significant driver of this load forecast.

And then we're also showing what's decreasing.

So rooftop solar, energy efficiency, decrease our load.

Okay.

With growing loads, we're going to need new resources.

This is showing what the integrated resource plan showed that we're going to need for new generating resources over the next 20 years.

This is showing average generation from both our current resource mix as well as new resources.

Along the horizontal axis, we've got the years that we studied, and then along the vertical axis, we have average megawatts.

This is how much each resource is producing.

The darker blue at the bottom is our Bonnetville Power Administration contract.

The orange represents our current owned hydro resources from the Skagit boundary as well as our small hydro.

And then the light blue is other existing contracts.

When we look to 2030 and beyond, we see growing yellow, gray, and green parts of these bars.

Hmm, I like this chart.

The yellow is showing customer side resources, such as um demand response, commercial solar or residential solar.

The gray represents new wind, and then the green represents new utility scale resources, solar resources.

The black line shows our average load.

So this is the same line from the previous page.

We're showing our average load increasing as we need more.

Um we can see here each of these bars exceeds our load.

That's because this is our average load, whereas we need to meet peak load and load changes based on seasonal variations, daily variations, as well as when we have volatile weather events, and we need to make sure we have enough resources to meet all of those situations.

This is the same information provided in a little bit of a different format.

This is nameplate capacity.

So for solar, for example, that's gonna be middle of the day, middle of the summer, solar could produce up to 600 megawatts, but across the entire year, it's going to produce significantly less because we're obviously not producing solar power at night, and we produce significantly less during the day during the um winter.

This also has battery resources.

Batteries not generating power, but it's going to help us move power into those demand periods.

Um we talked about managing peak demand previously.

Batteries are one of the ways that we can help do that.

Um so overall, we're showing a need for over 1700 megawatts over the first 10 years of the study period and over 1800 over the next 10 years.

For 3500 megawatts total, which is a really significant number of resources.

Okay.

No, this is no good.

Keep going, Shabon.

So the requested approval will allow City Light to be more competitive as we look for new resources to meet our power needs.

We're not the only entity that needs new resources.

A recent regional study identified a need for nine gigawatts of new resources across the Northwest by 2030.

So a gigawatt is a thousand megawatts.

So almost significantly more than what we're saying.

Um we're competing not only with other utilities, Bonneville Power Administration, but also with technology and data center developers to find enough power.

Additionally, we're seeing tax incentives expire.

Um these can make up to 30% of the capital cost of a project.

We want to find the projects for our customers that are that have those tax credits available to them at that lowest cost.

So the additional authority is going to make us more competitive, other power purchasers that we can secure the best resources for the city of Seattle.

Can I ask you a quick question, Siobhan?

I know that.

I know that you're asking for the authority for Seattle City Light to authorize uh contracts up to 10 20 years.

Was it intentional before that they limited that contracting ability?

Could or is it was it just, are we just trying to keep up with the times?

We're trying to keep up with the time.

So in the past, we haven't needed new resources.

Um we had more than enough with our hydro.

When we build or when a developer builds a new resource, they look to finance it, and we're gonna get the lowest cost if they can finance it over the longer time period because they can spread out their cost over that entire period.

And so then that will give us a lower construct um a lower power cost.

But aren't we financing it through bond financing?

So these are for projects that we would not own, where they would be owned by a third party and we would buy the power from that project.

Oh, I see you're saying okay, I get it now.

Okay, great.

Wait, Casper Rivera has a question.

Yeah, you got the right slide, girl.

Yeah, just to confirm Siobhan.

I mean, some of it is some of this is because we actually, until more recently, the last few years, we had plenty of power.

We were selling power.

Now we have to buy power, so now we're in this situation.

So I think that's part of it, correct?

That is exactly part of it.

Yes.

So as we see our load increase as well as as we see volatile, more volatile weather, which drives higher peak loads.

We're gonna need to buy power more often.

Um, our power is not constant throughout the year, so sometimes we will still sell it.

So like in the spring, we see um snow melts, we have a lot of hydropower, we're selling power, but during periods when we're gonna need it most, we need to buy power.

And a lot of that had to do with just the electrification piece, which you outlined in the other slide.

Okay, thanks for confirming that.

See Siobhan, when you think when you put together slide six, did you?

I mean, you have Amazon Meta, Amazon Grant, a visa, PGA Pacific Core.

Is there any particular reason you listed them that way?

Are they are these like number one?

I mean, is there a reason why?

No, the first one, um, Amazon was compete the big story was that Amazon was competing against Puget Sound Energy and they were able to outbid PSE for a solar and storage project in Oregon.

So that one was got a lot of attention because it was a direct competition before between a technology company and a utility.

Um the rest of these there was a specific reason for that order.

Okay.

Yeah.

They're just there's sort of been larger to smaller, but there's there was a specific reason.

But we wanted to tell the story was that we're not the only ones that need new renewables.

This is at need across the region, um, and we're competing and it's um strong competition, and the better the more quickly and more flexibly we can act, the better we can secure resources for our customers.

Okay, Shabon, I'm gonna have you hold up one minute.

Councilman Rivera has a question.

Thank you.

Yeah, thank you, Chair Siobhan.

So um can you just confirm so we're competing against these tech companies, but do cities and and you may not know this, but does cities get um priority for I mean, are these it just seems to me like cities need obviously electricity for their constituents and technology companies or commercial businesses, so is there no within this um we are straight up just competing with these commercial entities and there is no prioritarization for for cities for actual residents?

That's right.

So these are projects that are developed by private companies, and it takes years to develop a project to go through the permitting process to do um what's called an interconnection study, which tells you whether or not you can interconnect to the transmission grid and to get rights on the transmission grid to move the power from where it's developed back to Seattle.

Um because we didn't have a need for resources, we haven't built up that capability internally yet.

So in order to bring resources on quickly, we're gonna partner with third parties that are already developing these projects.

But for the most part, these are private companies, um, and they're gonna look to sell to the maybe not necessarily the highest bidder, but one that has a good um credit score, one that they can rely on and know they can work with.

But there isn't any prioritization for cities.

Okay, so Siobhan, so how does Grant County fit into that?

So they um they were able to secure and we've secured PPAs as well.

We've signed two solar PPAs, but they're another entity that we'll be competing with.

Okay, yeah.

And Pacific.

It's not just tech companies, it's utilities as well that are looking for these resources.

Okay, okay.

Oh, Councilman Kettle's hand is up again in the bookcase.

Go ahead, Councilman Kettle.

Um thank you, Chair.

Yeah, I'm looking through, I have the briefing separately up and I'm bouncing through the slides and you know, when I look at slide two, you know, I think about um, you know, climate change, you know, you know, what we're up against, you know, in terms of the different challenges.

And you know, and then as you walk through your briefing, um, you know, it kind of goes to like what we were just talking about with direct break cable, um, the infrastructure pieces because it takes infrastructure, you know, to build out even like solar wind, all these different pieces.

And as you go up against um what City Light is up against, you know, the competition is definitely one, but it's also up against the competition to build infrastructure, you know, the transmission lines and and everything along those lines because uh as we're seeing now in terms of the East and West Washington or the Cascades, there's a lot of different pieces that go to that.

And I'm just thinking, you know, the there's different types of competition and other factors that city light is is up against and climate change.

I say that partly because the competition across the board on these markets, and then the ability to transfer amongst these markets, you know, which is a hiccup with the infrastructure and the and the quality of the infrastructure and the age of the infrastructure.

But this combination is is quite the challenge.

Am I right in everything I just said?

Or my you know, am I off base?

No, you're completely right.

Um transmission is gonna be a really big challenge, and we're coordinating with others throughout the region for trend both coordinating and competing with others throughout the region to build that transmission.

Um and then another way that we're gonna be competing is that you know, data centers need to build substations, they need infrastructure, like you said.

So not just are we competing for solar projects, but the actual um supply chains that we need the the actual equipment that we need to build projects, those are gonna be in competition as well.

Well, hopefully the urban data centers uh you know it's interesting.

We brought up new core steel plan earlier, um, which is incredible in terms of their being a you know the massive um user, but they they found a way to for every byproduct to become a product to sell, and you know, and I just think of you know, in this space as well, you know, in terms of what we can do uh to really move forward and you know, and find ways to you know develop different pieces of the market to really create you know climate change itself.

You talk about solar the shifts and and the hydro and all these different pieces, and it's like hey, how can we you know take advantage of some sort of you know and change?

There's always opportunities to take advantage of the change itself, and I just think that you know we we need to be thinking in that long-term strategic uh fashion, and it shows up in terms of you know what we're up against.

So I guess I'm saying in a way that you know this is one slide that says we're up against competition, but in reality, City Light is up against a number of different things, and you know, and mark walking through that, you know, and you know, and back to this with data centers, they create heat.

So here in Seattle, there's one that you know that heats six buildings.

Imagine if every data center, small, big, or you know, large was having some type of thing where that byproduct was being monetized or is being used in some other way, kind of going back to the new core uh steel plant to then to lessen the burden on another area.

If these buildings are being heated and all new buildings are being electrified, well, that's a way to mitigate and ameliorate that situation.

So, anyways, I know I realize this that was a long um piece, uh, but I think that we have to be discerning in our discussion and conversation about this issue because it's very complex.

It's easy to say some things are good, some things are bad, some things are easy, some things are hard, but it's more complex than that, and as we walk through it, and that um and that's what I was you know coming up here against, if you will, is that it's more than just the competition.

So, um, sorry, Chair, that's a bit of a a statement versus uh I think I did get at least one question in there, right, Siobhan.

No, I think I don't think you did, but go ahead.

All right, so thank you.

But thank you for that, Councilman Kettle.

But I did have you did raise something, Councilman, all teasing aside for Siobon.

Siobhan, you listed seven, so I'm guessing that we have more competition than just these are just the top seven, or yeah, these were seven that were top lines that have been recent, gotten some um press um out there, but yeah, there's a lot of competition.

Um and not on here is Bonneville Power Administration.

We expect them to start a procurement program in the next either later this year or next year.

So they'll be on they'll be we'll be competing against them as well.

Hey, Siobhan, I should add for the viewing public to that, and thank you so much, you and um, it's Rob, uh, for well actually Rob wasn't there yesterday, but we met with the accommodation and their folks on the Columbia and Hydro and competition and data centers in eastern Washington, and also who got outbid, and then today we are reading in GeekWire where Amazon again um outbid and gained more property.

I can't remember the other who else was it with Amazon.

Do you remember what space they got in South?

You don't remember?

Okay, policy poll does not have an answer, which never happens.

Um, so um we have a little bit more background with that.

Castro Kettle, I'd be happy to fill you in on all that information in customer for Saka.

Um, so we've been we've been tracking all that, not just on this side of the mountains, but on the other side of the mountains.

So thank you, Siobhan.

Yeah, thank you.

This is my last slide, just restating the requested action to amend the legislation to allow us to additional authority to sign these agreements.

And so I was hoping Jeff was here because again, I always like Jeff's writing and his summary and fiscal note because he does sum it up that in order to execute these agreements for power delivery up to 240 months for capacity energy.

Um I think the most important thing that we were looking at is that these are um these are for um just electrical power, right?

Non or what's it?

Oh are you on there?

I don't see him.

Okay, well, I just it just when he says, I think if we move this over when I move Jeff is here.

Is he here?

I don't see him.

His photos, I mean his camera's off, but he's there.

Oh, there he is.

Okay, well, I don't want to he's anyway.

I think when we we were reading the summary and fiscal note, we were talking about it.

Um, this for the viewing public that the legislation allows Seattle City like to secure long-term power purchase agreements for non-carbon emitting renewable energy resources, and that's the most important thing I think people wanted to hear and make sure that that's what we are doing.

Did I miss anything, Paul?

Eric, on social status.

Oh, Eric has his hand up, okay.

I apologize, you guys.

I'm toggling back and forth on this on the screen here, but where are you?

There you are, Eric.

Go ahead.

Um that just determined that what you said is correct, and that uh technically this is 240 months.

His contract for 240 months would include possibility of energy, including attributes, transmission, or ancillary services.

And it's also important to know that these would be consistent with the department's long-term planning processes.

So you can think of something like uh the IRP, the integrated resource plan that came to council earlier as the place that you would see the um the planning word plan is right in there that would lead to these kinds of contracts.

So it's all grounded in the work that um the City Light does.

Right, and also in the in the summary and fiscal note, they did they do um I I'm and I council member um Peterson got this in here about making sure that in the summary and fiscal note that we address climate changes and impacts, which is also in there as well.

Which was not there before.

All right.

Okay, so with that, um, are there are there any other questions from my colleagues before we move on to a vote?

And I'm going to.

Oh, there's Jeff.

Okay, Jeff, hey.

Good to see you, buddy.

Thank you for the summary.

We can't hear you, you're on mute.

Good afternoon, Councilmember Juarez.

I should say that Jeff and I used to practice a lot together, so always appreciate your writing, Mr.

Wolf.

Thank you.

Such a modest man.

Um, all right.

So if there's not any other questions.

Oh, there is who?

Did you have one?

I go ahead, Councilman.

Thank you, Chair.

Just have a comment, just as in with the vote we just took on the planning.

I mean, we hear a lot about rate increases and and I understand the concerns from constituents about that.

Um, and it and not or um City Light needs to be able to plan, as you heard, we're in competition for power, and so we need to also have uh a plan, a long-term plan, like we just passed, and then this um next vote to give them the ability to have flexibility to enter into agreements so um we're not missing out on uh um uh negotiation because they don't have the ability to do so, and that's important because this is moving really fast, and we're in competition as we saw with a lot of entities, not just other cities, and I was just at the association of Washington Cities, so I know other cities are also grappling with the power needs that we are.

Um, but we're we're all the cities are in competition with all these private entities as well.

So I just want to state that for the record as we're taking these votes that the public understands is today's votes are not about the increases, but they are about the ability to um allow City Light to enter agreements to purchase power as well as to have a long-term strategy for power for the city.

Thank you.

Thank you.

Councilmember Rivera and I should add is Councilmember Kettle has said this in his public safety committee.

Councilmember Saka Rivera, myself and Councilmember Lynn are all lawyers so that's why you got a lot of questions um going back through this not to say that you have to be a lawyer to do this.

I'm just saying that's why it got a little wonky.

But you guys did a really good job except for the page numbers but that was okay as Councilman Kettle said that kept us on our toes.

Okay so I'm not seeing any further questions or hands raised is there anything else Paul do you see anyone else on the screen that I'm missing okay good all right okay so I'm gonna go ahead and um I move that the committee recommend passage of council bill one two one two four one is there a second second thank you councilmember Rivera it's been moved and seconded to recommend passage of the bill uh with the clerk please call the roll council member Saka councilmember Rivera aye vice chair kettle aye aye chair there are four votes in favor thank you the motion carries and council bill one two one two four one will be sent to the July 7th full city council meeting okay so that ends today's agenda and um any other comments from my committee for the good of the order okay I'm not seeing any um since there's no further business we are adjourned at 2 39 and also thank you so much sales city light thank you Rob thank you Jeff thank you Eric thank you Siobhan who else did I forget Kirsty I think that's all did a great job yeah thank you to everybody yes um yeah policy Paul um goes in gale does anyone know the score it's two too they're an overtime two and they're in overtime I got money right on City just gonna say I'm just gonna say it was two or two one earlier today all right all right well go Senegal thank you madam chair thank you all right thank you thank you Kirsty bye Jeff.