COUNCIL STAFF REPORT
CITY COUNCIL of SALT LAKE CITY
TO:
City Council
FROM:
Ben Luedtke, Public Constituent Liason,
Policy Analyst
DATE:
October 20, 2016 12:41 PM
RE:
PacifiCorp (dba Rocky Mountain Power)
Electrical Utility Franchise Agreement
PROJECT TIMELINE:
Briefing: Tuesday, October 25,
2016
Public Hearing:
Potential Action: 11/1/2016
Clearline
Legislative Sponsor:
ISSUE AT-A-GLANCE
The Administration has forwarded a new franchise agreement with Rocky Mountain Power (RMP) for a
term of five years. It would replace the now expired franchise agreement and provide the contractual
framework for RMP to continue being the electricity provider for Salt Lake City. The previous 25 year
franchise agreement (Attachment I) expired in January, 2016, however, RMP is still obligated to provide
electricity.
Historically, franchise agreements have focused on the rules of access and operations within the public
right of way as well as financial management. The historical approach is expanded by pairing a nonbinding Clean Energy Cooperative Agreement with the proposed franchise agreement. The Clean Energy
Cooperative Agreement is a joint statement to affirm RMP and the City will collaboratively work toward
achieving explicit sustainability goals. A requirement of the franchise agreement (binding) is an annual
report updating the City on progress, anticipated next steps and other considerations. Under this
approach, the City and RMP will collaborate on increasing the supply of renewable energy in the Salt Lake
City market. In August, RMP CEO Cindy Crane and Salt Lake City Mayor Jackie Biskupski signed the
Clean Energy Cooperative Agreement.
Three Primary Sustainability Goals in the Clean Energy Cooperative Agreement:
1.
Facilitating increased access to renewable energy
2.
Cleaner air in the local airshed
3.
Achieve community-level climate change goals
Key Dates
1.
March 31, 2017 – deadline for completion and acceptance of the initial joint implementation
plan
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Meeting of November 1, 2016
2.
April 30, 2018 – deadline for first jointly published annual progress report (city staff will
coordinate and check RMP’s progress with the stated goals in the Cooperative Agreement)
3.
Summer, 2021 – negotiations begin for a new franchise agreement (assuming the proposed
franchise agreement is approved by the Council this year).
SLC Renewable Energy Goals from July, 2016 Joint Council-Mayor Resolution (see Attachment II)
1.
50% renewable energy for municipal facility operations by 2020 (4 years in the future)
2.
100% renewable energy for municipal facility operations by 2032 (16 years in the future)
3.
100% renewable energy for community wide electricity supply by 2032 (16 years in the future)
4.
80% reduction in Salt Lake City’s greenhouse gas emissions by 2040 (24 years in the future)
a.
Collaborating with RMP could significantly move the City toward this energy
goal, however, it is insufficient alone to achieve an 80% reduction in greenhouse gas
emissions.
Goal of the briefing: Discuss with the Administration the proposed RMP franchise agreement.
POLICY QUESTIONS
1.
What are the pros and cons of a RMP franchise agreement that has a shorter duration than the
previous 25 year agreement?
2.
Are there utility infrastructure investments the City needs to reach the first energy goal of 50%
renewable energy for municipal facility operations by 2020 (4 years from now)?
3.
What would be the City’s options if progress toward the sustainability goals fails to meet agreed
upon targets?
4.
The Council may wish to ask the Administration, how will progress on the sustainability goals
be measured?
5.
The Council may wish to ask the Administration, how has community input been incorporated
into the City’s sustainability goals?
6.
The Council may wish to ask the Administration, how would the sustainability goals adjust
overtime as technologies and local circumstances evolve?
7.
How will the community renewable energy feasibility study, currently underway in
collaboration with Park City and Summit County, help inform implementation of Salt Lake City’s
sustainability goals in partnership with RMP?
a.
On April 19, 2016 the Council approved $30,000 in budget amendment #3
which represents Salt Lake City’s share of the $90,000 feasibility study cost. The final
report is expected Winter 2016/2017.
8.
The Council may wish to discuss with the Administration why the design standards and rules
regarding ground mounted utility boxes are not included in the RMP franchise agreement.
a. The Council adopted updated standards in City Code section 21A.40.160 March 24, 2015
(see Attachment V for ordinance).
ADDITIONAL & BACKGROUND INFORMATION
Areas of Collaboration to Meet Sustainability Goals
1. Reduce energy waste across all sectors (residential, commercial and industrial)
2. Expand infrastructure for, and use of, electric vehicles (EVs)
3. Integrate and invest in smarter grid technologies such as energy storage and enhanced demand
response capabilities
Smart Grid Description
Attachment III is a one page graphic with talking points about smarter grids from the Department of
Energy. The Administration provided the following description of a smart grid:
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Meeting of November 1, 2016
“A smart grid is an evolved grid system that manages the generation, delivery and use of
electricity in a more efficient way. A smart grid strives to enhance reliability and security while
also allowing the integration of new technologies (e.g., electric vehicles, battery storage and
intermittent renewable energy resources). A smart grid is important to ensuring that the
transition to renewable energy and other clean technologies is completed in a cost-effective way
that also provides more frequent information and price signals to customers.”
Salt Lake City’s Electricity Supply
According to RMP’s 2015 data, the overall electricity generation sources for its entire service area (Idaho,
Utah, and Wyoming) is made up of 62% coal, 15% natural gas, 13% renewables and 10% other. RMP has
not published a breakdown of electricity generation sources for individual municipalities. Approximately
6% of Salt Lake City’s electricity supply is produced with solar and biomass generation facilities within the
municipal boundaries. Next year, this figure is expected to double to 12% as RMP’s Subscriber Solar
program begins.
Energy Efficiency Programs
RMP has dedicated websites for residential and commercial energy savings programs that have been
approved by the Utah Public Service Commission. These are:
RMP Residential: https://www.rockymountainpower.net/res/sem/utah.html
RMP Commercial: https://www.rockymountainpower.net/bus/se/utah.html
The Administration indicates the Database of State Incentives for Renewables & Efficiency (DSIRE) is a
comprehensive clearinghouse of energy savings programs in all 50 states. DSIRE’s database shows Utah
has 29 energy savings policies and programs which is fewer than most other states.
DSIRE: http://www.dsireusa.org/
Electric Vehicle Incentive Program (SB115 of 2016)
The Legislature authorized a pilot program to run for a period of five years starting January 1, 2017. The
Public Services Commission may authorize up to $2 million/year over the five year pilot program for a
maximum of $10 million. The pilot program is specifically for infrastructure related to EVs such as
charging stations and conduits. The pilot program framework is described in section 54-20-103 of Utah
Code. SB115 also empowers the Public Services Commission to authorize other innovative utility programs
as described in Utah Code section 54-20-105 (see both sections in Attachment IV).
ATTACHMENTS
I.
II.
III.
IV.
V.
1991 RMP Franchise Agreement
2016 Joint Resolution: Renewable Energy and Carbon Emission Reduction Goals
Department of Energy One Page Smart Grid Framework
Utah Code 54-20-103 Electric Vehicle Incentive Program and 105 Innovative Utility Programs
Salt Lake City Code 21A.40.160: Ground Mounted Utility Boxes
ATTACHMENTS:




Administrative Transmittal PacifiCorp (dba Rocky Mountain Power) Electrical Utility
Franchise Agreement
(PDF)
A1 - Rocky Mountain Power Franchise Ordinance (PDF)
A2 - Rocky Mountain Power Franchise Final
(PDF)
A3 - Exhibit to Transmittal - SLC-RMP Clean Energy Cooperation Statement
(PDF)
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