PG&E’s Response to South San Joaquin Irrigation District’s Municipal Services Review and Proposed Takeover September 22, 2014
PG&E’s Commitment to Safety, Reliability and Affordability Introduction – Dylan George 2
This is Not Your Ordinary Municipal Services Review: An Unprecedented Request • There is no record of any similar LAFCo approval of an expansion of this magnitude by a special district. • There is no record of any LAFCo approving an eminent domain expansion by which a special district seizes the assets of an operating utility. • This would be, by far, the largest eminent domain takeover of a utility in California in decades. • With this MSR, SSJID is asking LAFCo to approve a “change of organization” that would massively expand SSJID to over 10 times its current size, essentially creating a giant new special district. Introduction – Dylan George 3
Overview The correct issue for LAFCo to decide is not whether SSJID is capable of providing retail electric service, but “would the reorganization be in the best interest of the agency and the community it serves?” 1. Is SSJID prepared for what they are trying to do? 2. Would customers suffer a degradation of reliability? 3. Can SSJID deliver on its promise to save customers 15%? 4. Who would lose in an SSJID takeover? 5. Are the legal and financial risks too great? Introduction – Dylan George 4
Overview 1. Operating the System – Jeff Deal, P.E., Director, Electric Maintenance and Construction Central Valley Region 2. Reliability – Raj Beasla, Director of Local Presence, Central Valley Region 3. Financial – Vijay Bhaskaran, Financial Analyst 4. Reduction of Services – Aaron August, Director, Customer Care Central Valley Region 5. Legal Analysis – George Soneff, Partner, Manatt, Phelps & Phillips, LLP Introduction – Dylan George 5
Is SSJID Prepared for What They Are Trying to Do? Jeff Deal, P.E. Director, Electric Maintenance and Construction Central Valley Region
Where were you on August 24, 2014 at 3:20AM? Operating the System – Jeff Deal, P.E. 7
PG&E Customer Recovery Data 70,000 Customers 24 Hours Later Operating the System – Jeff Deal, P.E. 8
Napa Earthquake – Base Camp Operating the System – Jeff Deal, P.E. 9
Is SSJID Prepared for What They Are Trying to Do? “For the past 50 years, SSJID has been in the electric business — generating clean hydroelectric power and selling it on the wholesale market. Now we simply want to close the loop and also serve retail customers .” “SSJID’s current senior management has over 65 years of experience in electric utility management and power marketing.” Source: SSJID Website , SSJID LAFCO Application Justification of Proposal Operating the System – Jeff Deal, P.E. 10
Vague Staffing and Emergency Response Plan SSJID’s Staffing Plan: • 1 Operations Managers • 2 Full Time 4-Person Line Crews • 3 Journeyman Troublemen • 56 Other “Experienced Electric Utility Staff” SSJID’s Emergency Response Plan: “SSJID will become a member of the California Utilities Emergency Association (“CUEA”) whose members will provide mutual assistance to SSJID during periods of emergency.” Operating the System – Jeff Deal, P.E. 11
Evolution of the Grid Local Distribution Long Distance Transmission connects to homes, connects power plants to offices, and factories local distribution grids Power flows one-way from generation power plant to retail customer appliances and equipment Customers use electricity in homes and businesses Operating the System – Jeff Deal, P.E. 12
Evolution of the Grid Future State – Power Flows in Many Ways Customers generate and use electricity requiring sophisticated metering and control systems Operating the System – Jeff Deal, P.E. 13
PG&E Local Electrical Workers Engineering Phones Dispatch Electricians 35 Troublemen 135 Linemen Technicians Control Room Operators
Control Center Operations California ISO Operating the System – Jeff Deal, P.E. 15
SmartGrid in Progress Engaged Consumers Smart Markets Smart Utility Customer Energy Management Outage and Load Management Home Energy Reports Energy Storage PG&E is using SmartGrid technologies to provide customers with benefits today 16
Would Customers Suffer a Degradation of Reliability with SSJID? Raj Beasla Director of Local Presence, Central Valley Region
PG&E Reliability Statistics Within Proposed Takeover Area Average Interruption of Service (Minutes) SAIDI: System 180 166.6 162.4 Average 160 Interruption 144 Duration 140 Index 120 98 92.6 100 78.3 80 85.4 78 69.4 60 40 20 0 2006 2007 2008 2009 2010 2011 2012 2013 *2014 *2014 projected based on YTD data Reliability – Raj Beasla 18
PG&E Reliability Statistics Within Proposed Takeover Area Average Frequency of Interruption SAIFI: System 2.5 2.229 Average Interruption 1.909 2 Frequency Index 1.512 1.5 1.139 1.074 1 0.799 0.908 0.716 0.5 0.538 0 2006 2007 2008 2009 2010 2011 2012 2013 2014* *2014 projected based on YTD data Reliability – Raj Beasla 19
SSJID Acknowledges They Cannot Improve Reliability “ changing the provider of retail electricity from PG&E to SSJID could stimulate economic activity by offering reduced rates and improved quality of service and reliability . ” - SSJID MSR (3/04/14) Page 21 (emphasis added) “changing the provider of retail electricity from PG&E to SSJID could stimulate economic activity by offering reduced rates and improved quality of service and reliability . ” - SSJID MSR (9/09/14) Page 21 (emphasis added) Reliability – Raj Beasla 20
What it Takes to Deliver Safe and Reliable Power 20-Year Plans 5-Year Plans Trained Backup Workforce Equipment Smart Meters Vendor Agreements Smart Grids Storm Rooms Materials 10-Year Plans FLISR Emergency Communications Plans Reliability – Raj Beasla 21
FLISR Scheme – Normal Configuration Circuit #1 Circuit #2 Circuit #3 Substation Reliability – Raj Beasla 22
FLISR Scheme – Fault Location 3000 Customers Without With Served FLISR FLISR Confirm CB Open 1 min 45 mins Circuit #1 Circuit #2 Circuit #3 Circuit Failure Substation Reliability – Raj Beasla 23
3000 Customers Without With FLISR Scheme – Isolation Served FLISR FLISR Confirm CB Open 45 mins 1 min Determine Fault Zone 45 mins <1 min Circuit #1 Circuit #2 Circuit #3 Circuit Failure Substation Reliability – Raj Beasla 24
3000 Customers Without With FLISR Scheme – Service Restoration Served FLISR FLISR Confirm CB Open 45 mins 1 min Determine Fault 45 mins <1 min Zone Restore Healthy 30 mins <1 min Zones Circuit #1 Circuit #2 Circuit Failure Circuit #3 Substation Reliability – Raj Beasla 25
3000 Customers Without With FLISR Scheme – Service Restoration Served FLISR FLISR Confirm CB Open 45 mins 1 min Determine Fault 45 mins Zone <1 min Restore Healthy 30 mins Zones <1 min 120 mins <3 mins Circuit #1 Circuit #2 Circuit Failure Circuit #3 Substation Reliability – Raj Beasla 26
3000 Customers Without With Served FLISR FLISR FLISR Scheme – Return to Normal Confirm CB Open 45 mins 1 min Determine Fault Zone 45 mins <1 min Restore Healthy 30 mins Zones <1 min 120 mins <3 mins Final Repair - 60 Minutes 60 Sustained Cust-Inter. 3000 1000 Customer Outage 360,000 Mins 60,000 With SSJID FLISR 67% Fewer Will Not Work Sustained Circuit #1 Circuit #2 Customer Interruptions Circuit #3 Substation 83% Fewer Customer Outage Minutes Reliability – Raj Beasla 27
SmartMeter ™ SmartMeter ™ enabled tools allow customers to see exactly how they're using energy so they can make informed decisions that help reduce their bills. More Reliable Service SmartMeter ™ provides for two-way communication between PG&E and the grid allowing us to quickly identify outages and resolve other services problems. See Your Daily Energy Use It’s as easy as going online to see a detailed history of your energy usage and costs, up to the previous day. Get Alerts About Your Usage Energy Alerts, made possible by SmartMeter ™ technology, let you know when you’re moving into higher -priced electric tiers so you can manage your energy use and save. Smart Devices and Smart Homes If you opt in to the Home and Business Area Network (HAN), your SmartMeter ™ could connect to the smart devices in your home so they can automatically respond to energy usage from the grid. 28
PG&E’s Electric System Within Proposed Takeover Area • PG&E has 8 substations that serve the proposed takeover area • SSJID has proposed a total of 4 substations o Purchase 2 from PG&E o Build 1 - Jack Tone o Share 1 with MID- Clough Reliability – Raj Beasla 29
PG&E’s Electric System Within Proposed Takeover Area Special Equipment to PG&E has a unique system Serve Unique System: • 17kV, which is PG&E’s Mobile unusual and not an Transformer industry standard • Requires special orders for parts and maintenance • Specific equipment requirements to serve the area Reliability – Raj Beasla 30
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