So we will start up with the last Burlington Electric Commissioner meeting of the year. This is the regular standing Wednesday, second Wednesday of the month, December 14th, 2022 meeting. And first up on the agenda is the agenda itself. Are there any suggested modifications or changes or additions? Nope, okay. Second up is the minutes of the November 9th, 2022 meeting and so this is, as per usual, if you found anything substantive that is incorrect, this is a great time to bring it up. And if it's just an editorial piece or rather typo, that's something that can be shared with the clerk just via email. Anyone see anything? Mr. Herondine. Me, not this time. Not this time. Move to accept as presented. Second. All in favor. Aye. Thank you, Lori, for your work on that. Third is the public forum. I don't, do we have anyone? It does not look like it. I cannot actually see that far. Okay. And we do not have anyone in the room, but folks at home, you're of course, always welcome to join us on the second Wednesday. You're also always welcome to reach out to the commissioners. Our contact information is on the website and you're also always welcome to reach out to Mike Kenrick and his team with the customer service group, but you have a different name. Apologies. Fourth is commissioners corner. If anyone has anything, I have a couple of updates, but if anybody else has anything, now's a good time to bring them up. We will discuss briefly the lighting meeting that's coming. Okay. Yes, so that was one of my updates. So we were going to meet last Thursday. We are gonna shift that to January so that we actually have the engineer who will actually be on staff rather than asking Mooneer and engineers from his team attend who won't actually be the point person who will be overseeing whatever the future lighting discussion looks like.  Do you have any sort of timing update in terms of what that might look like for January for? I think, I don't know how much, can we reveal anything relative to the director position of engineering? Maybe we won't reference the individual, but start date. Four. Okay, great. So I can follow up with Laurie to figure out meeting time for scheduling that. Although I feel like the individual should probably might want a week or two to actually be at work. So maybe it'll be like the third week of January that we try to schedule something so that maybe there'll be a little bit of up to speed depending on if the individual is coming from outside of BED or inside. Outside. Okay, great.  Thank you. And with everybody else who had expressed interest from last time around. And my only other update is this is my last meeting. And so Monday, the city council confirmed a replacement for me. So thank you, everybody. I just am recognizing that it's highly unlikely I will ever show up on time on Wednesdays once the legislative session kicks in. And my term comes up in end of June anyway. And I'm a firm believer that nine years is a good time to step down. So good to bring in new blood. And I suspect you guys will really quite enjoy Laura Bonn. I worked with her over a decade ago in energy. She knows a lot more about energy efficiency and sort of various heat pump technologies, that sort of thing. She's a quick read and very interested and very smart organized. So I think she'll be a great addition. And I would have liked to have served with her, but it was a pleasure to serve with you guys all and with you all as well. Thank you. Thank you. Yeah. Yes, thank you for your service and your leadership over the years. Thanks. But I'm still not really going too far away cause I still have this lighting thing, which actually to clarify. So I will not be a commissioner, obviously, but I feel like since I was the one who asked this south end lighting expert to participate in this conversation with the engineers at BED, I feel like it's not really appropriate for me to just not show up. So the first meeting I will be there and to sort of tee things up, start the conversation with the umbrella concept of understanding that the IES regulations are pretty nuanced. Is there a way to still follow those to meet concerns regarding liability and to also interpret them in a way that perhaps might not feel as bright to the community. So that's my hope in the conversation and we'll see where it goes from there based off of the conversation with the folks in the room. Okay. Yeah. Anything else from commissioners corner? So next up is general manager update. Thanks, Darren. Thank you. And just upfront, we also thank you for your service. We do have some cake to commemorate your time on the commission with us for after the meeting and really appreciate everything you've done for the Burlington community. And we'll continue to do, I know, in different capacities, but thank you for your service on the commission. Okay. So a few updates in the report, a couple of really substantive ones that we're certainly interested to share. District energy, as I think you all know from the report and from our previous conversations, but just to confirm, we're expecting that to go to act 250 permitting this week filed by the nonprofit entity, Burlington district energy that's run by Evergreen. That'll keep us on the schedule that we've hoped to be on for the project. I also expect we're gonna have those construction bids in by the end of this week as well. So we'll know a little more concretely what the potential pricing for that aspect of the project looks like. First quarter of 2023 will be significant for the financial arrangements and agreements. We're continuing to work on the McNeil steam pricing. We're continuing to look at the customer allocations and what the interest will be there. We're gonna be looking at interest rates. We're having kind of a number of conversations with Vita and the treasurer's office around what the interest rates might be if we're able to work with state government on those. Obviously the rise in interest rates, not our friend relative to financing the project, but there may be some avenues within the state to help get a more favorable rate than what's out there commercially, so we'll explore that. But really our hope is in the first quarter of 2023, we'll have a clear sense whether the project can pencil for all the relevant entities. And if it can, then we'll make a determination at that point that would be the go determination for the project and would continue the permitting process and move us towards construction. We also still have some work to do with the federal government related to the Leahy funds. They're looking at whether or not what level of NEPA review is necessary on their end, which will affect the timing of the project, funds being released, but we can also seek reimbursement from them so it shouldn't hold up anything on our end relative to construction or anything like that. So a significant milestone. We've definitely never gotten to this point with district energy and any iteration over the past 40 years. And it's exciting, but I temper that with the caveats that we have not yet reached. The financial agreements necessary to move the project ultimately forward. So I'll pause there if there are any questions on district energy. Is it still gas-free? Yes, it's 100% fueled by McNeil steam and by the supplemental electric boiler, which would be powered by our 100% renewable electricity. No additional natural gas. Sense of timing for, I mean, NEPA you said could potentially push it back, but... Just the federal monies, not the project itself. Yeah, no, I think if we were on track with everything, the way we had proposed it, construction would begin in 2023, continue into 2024 and you'd have operations either in late 24 or late 25, roughly speaking. So, we shall see. And the financial agreements, what is that sort of summer of 2023 you think? I think we'll know hopefully within the first three months of 2023 whether those are gonna work. As mentioned, there's the financing piece, what the rates are, how that affects the project costs, there's the construction bids, which we'll know sooner than later. There is the what level of pricing we need for steam from McNeil to compensate the joint owners appropriately, but also be competitive for the project. And then there is essentially the renewable district energy credits, which represent the environmental attributes of the project and the premium, essentially, associated with paying off the infrastructure. What's the allocation for those who's willing to purchase what amount? How can we allocate those among the various entities that'll participate? And what ramp up rate would there be for that? So those are the kind of the key pieces that we're looking at. So more to come, but good progress to date and we're pleased with that. And very, very thankful for our partners, BGS, the hospital, the Interval Center, UVM, the city, Evergreen, really a good collaborative working relationship in all of those avenues. On the second significant substantive item, and these both came to city council the same evening. So we were busy on the 5th of December is our thermal policy recommendations along with our colleagues at the Department of Permitting and Inspections. We attached the report, the final report, to the commission packet to the extent you're interested. And I believe last Monday, the 12th at city council, the, we had introduced a resolution sponsored by Councillor Mark Barlow that's being referred to the Transportation Energy Utilities Committee of the city council, which is meeting next Monday on the 19th to consider ballot language for town meeting day that they could refer back to the council in January and that would be placed on the ballot if we're successful in March for town meeting day 2023. So essentially just to summarize, we proposed a few different things and this work was informed by our work with the Building Electrification Institute, a national organization that we've worked with that knows a lot about what other cities are doing and provides technical assistance and support. Basically for new construction, we'd be proposing starting in 2024, it's 100% renewable for all thermal uses not just a renewable heating system that's in place now and that that would be applicable for everything except for domestic water heating for larger multifamily buildings. And that was based on feedback we'd gotten from the affordable housing community that in multifamily larger buildings that the current domestic water heating technologies are not as far along. So we proposed delaying that until 2026. And then if a building didn't comply with one of the renewable options and wanted an alternative compliance option, there would be a upfront carbon fee that would be representative of the lifetime expected output of the fossil fuel system and charged upfront at the time of permit. And similarly for large existing buildings which is commercial and industrial only non-residentials fully exempted, but for large existing buildings, 50,000 square feet or larger, again, starting in 2024, we proposed that if they pull a permit for a heating system or water heating system, they would use a renewable replacement or they would have the option to pay the carbon fee. In that case, we would cap the carbon fee at no more than 75% of the installed cost of the conventional system. We recognize in existing buildings, there's existing distribution infrastructure that in some cases may make certain things cost prohibitive. And then we recommend renewable be defined fairly broadly similar to what we've used already in ordinance. So it can be any renewable system, geothermal, wood heating, heat pumps, all the different technologies there could be a renewable fuel in a conventional system, biodiesel, renewable gas, district energy credits if that goes forward, or even the option for other fuels that may come online that aren't here now like renewable hydrogen, things of that nature. So we try to be broad and inclusive with all the different renewable fuels. And then we propose as well that the city would meet the large existing building requirement for all of its buildings as well. And then propose that the revenues from the carbon fee could be used for helping the city convert its fleet to electric vehicles, helping, and this is consistent with advisory question seven from town meeting day 21, which was focused on making sure benefits from this proposal would flow to lower income Burlingtonians, making available a clean heating technology fund from the city to support low-income households and low-income renters. And then in the case of an existing building only, if the payer paid in and proposed a plan to use a portion of the funds for emission reduction projects at their building or at their campus, that they'd be able to get a portion of the fund that they paid into back to support those emission reduction projects. We also built in some credits essentially for existing buildings where if they had multiple buildings and some of them might be covered by this and some might not, or some uses might be covered and some not, if they take steps that are consistent with this starting in 2023, that they would build up credit towards any future compliance obligation. So it's very much a little bit of a carrot and stick approach, not purely regulatory in that sense. And anyhow, this is a product of a number of years of work actually dating back to 2020 when the mayor first proposed building electrification proposal with input from BED, the planning office and the department of permitting and inspections, going through the charter change and through the renewable heating ordinance development last year, getting the charter change approved by the legislature and the governor and then being able to do an interim report in July and then this final report. So there's been some good analysis included in the memo. There's definitely more work to do, but the first aspect of this is to put it on the town meeting day ballot and get approval, which is required under the charter change subsequent approval to implement the fee portion of the proposal. Then we would go back to the council and work on ordinance language in the spring to begin effect in 2024. I'll pause there as well. If anyone has questions on that. Was it this week that the South Burlington city council voted three to two against something in the same direction? Yes, they voted not to pursue a charter change that's similar to what we did pursue with our charter change. Although they did also recently adopt essentially a version of the renewable heating ordinance for new construction that Burlington adopted last year. And theirs goes a little further than ours does in current ordinance. They also require that for water heating systems with a similar delay that I mentioned earlier. So they have taken steps on new construction, but they chose not to pursue a charter change. I should mention too, we're aware that there is housing legislation that's being considered or will be considered potentially in the legislature, a large kind of bill and in it is a proposal that's being advanced that would limit communities to ordinances being no more essentially stringent than state energy codes. And if that was to happen, that would not only impact South Burlington, what they're doing, but would impact us in terms of the further policy work that we're trying to do under the charter change and potentially the rental weatherization standards and renewable heating ordinance that we've already passed. So fairly concerned if that was to move forward without a consideration of those policies. So I just mentioned that in the legislative context. I asked that question because I'm kind of concerned that folks who want to find reasons to fight this will try. And one thing that I think is kind of critical there and you touched on is the idea, if the fee is a one-shot thing and you pay it, then the incentives you have are essentially zero for doing it later except for the payback scheme you talked about. So that's kind of a two-level argument, but the first argument would be if you do it, then there's no reason to do anything better later on. So I don't like it. You have to go to the next level subtly saying yes, but. So I think we have to make that really explicit and even quantitative. We definitely considered those two points that you just mentioned because you could have some sort of ongoing or attempt to have an ongoing fee, that would be more like a tax, tax on fuel consumption of a certain type as opposed to, this is really meant to be kind of a development impact fee. And what we really want to do is impact the decision at the time of investment and for the existing buildings to impact their capital planning process, years ahead of when they'll have to go to replace a system. So if we were able to enact this, even if you're an existing building that doesn't anticipate replacing a system for five years or 10 years, you're going to know that this requirements there and the carbon fee we propose starts at 150 a ton but ramps up with the rate of inflation over time. So you're going to build this into your capital planning and look at the alternatives for meeting this without having to pay the fee. And our hope is, is it'll change the investment decision process for new construction and for existing buildings. But there's merit to both approaches in my view, but I think we were really trying to focus on this not being a tax, but being a fee that would be very akin to a development impact fee. Well, I agree with you. I like our approach. I'm just anticipating critics. I understood. No, there would definitely be criticisms from various sorts. And we're, you know, we had a good stakeholder process. So we've heard at least some of the concerns, not all of them, I'm sure, but some of the ones that might be raised and tried to kind of proactively address some of those in the memo and in the proposal where we could. And we also went to all the NPAs and tried to hear from folks who might have ideas or feedback for us. So not an exhaustive engagement process necessarily, but at least we were able to get some feedback ahead of time and sure there'll be more that would come as well. I guess it's a limit to how many words you can put in a valid item, but we're gonna talk about how to craft it. Yeah. This kind of consideration I'm proposing is a piece of that crafting. Yeah. We worked on this and there's, you can be quite wordy in a sense. In some cases you kind of have to be to encompass all of the different aspects here. I think one of the things we're focused on with the ballot language is to be clear about which buildings would be affected. And I think it's equally important to note which ones are not affected, that this doesn't affect any existing residential, existing small businesses, even existing larger commercial buildings that are under that threshold. So we anticipate maybe 80 buildings in the city would fit the large existing commercial building threshold.  And we've definitely, we had an experience like that I think town meeting day 2021. And to some extent, just going through the legislative process making sure that folks understood in the legislature what we were looking for. But yeah, the ballot language, I think we'll also hopefully be specific around what we're attempting to use the revenues for if they are collected. Cause I think those are things as well that are important is to know where these monies might, might go. But I think, I mean, I'm sure you heard this, but the cost of development, like and that there's this Burlington's a little, like I think it sounds like a great idea and really progressive and in the direction that everybody wants that we should be going. But if our neighbors aren't doing that, we already have such a large property tax burden on residents and making the cost of commercial development higher. Seems like something that would be a hurdle for folks. I'm sure you would talk through that. And then with the big hole have to pay or whatever they fall into this because they better pay. But yeah, I don't know. I feel like Burlington's were a little bit in this cycle, right? Where we can't break out of it, even if we're doing a lot of good things until we can solve some of these more structural problems. I don't know if it's too soon, that would be my only. Yeah, definitely a point that came up and the mayor addressed this cause I think he cares a lot about the housing conversation and talks a lot about that and the importance of that as a priority for his administration, but also cares obviously a lot about this about climate and climate action. And I think the analysis that we had particularly for new construction is there are a variety of cost-effective options with new construction and we're seeing buildings in many cases using these technologies even prior to this policy being in effect. I mean, we have our neighbors over at Hula with a hundred percent geothermal heating and cooling. We have multifamily buildings around the community they're using heat pumps. So I think in engaging with developers I wouldn't say there's universal consensus around any of this, but I think there's at least an understanding that with new construction there are a lot of opportunities to use these different technologies in a way that can be cost-effective relative to conventional systems. What the carbon price structure does is just makes that playing field even more level in a sense for the renewable technologies and maybe gives a nudge even more in the direction of those technologies. But so point definitely understood there's a desire to build more housing in Burlington to have effective development policies. I think the mayor articulated that he thought this could be consistent with that. And on the flip side, of course, if we are serious about the net zero 2030 goal ambitious as it is, it's almost unfathomable to consider reaching that if we're not building new with a hundred percent renewable. So there's a tension there that I think is interesting to kind of get into but we felt obliged to propose something that would be at least consistent with the direction that we're trying to go from a climate standpoint but also practical and not overly burdensome in terms of development. Maybe we got it right. Maybe we didn't. I think we'll have that conversation. So and what about the downtown? So the way this is structured is any project that would be pulling a permit starting January one of 2024. So if they already are permitted they would be under the existing renewable heating ordinance. So they would have to put in a renewable heating system but for any building and I think some of those buildings are sequenced. So part of that project would be pulling permits after that date. If this was to be enacted would be subject to these requirements as well. Okay. And then last question. Is there a way to earn credits for transportation somehow? Not exactly, but we did contemplate that in terms of taking, if you pay into the fund because let's say you put in a conventional boiler and you didn't do a renewable boiler if you wanted to draw back some revenues from the fund to support a transportation related project at your facility then that would be eligible. So if you wanted to convert some of your fleet to electric or do something that would reduce emissions on transportation but primarily it's focused on the thermal sector. So there's a little bit of overlap there but we didn't really focus too heavily on transportation policy. Currently, if I recall correctly the efficiency team for new commercial construction does half of an incentive at the time of the build and then half of an incentive the other half of the incentive after a year's worth of data collection and analysis to see whether or not the expected energy savings were achieved is I'm just curious how that both in terms of capacity for the staff given that you guys are like 11 to 13 staff shy, I believe unless I mean, I guess you just made an offer. So you guys are, if you have 80 new buildings what that looks like for your efficiency team in terms of capacity and also how the various incentives or renewable energy standard tier three interplay with sort of helping that conversation because frankly, when I look at page 64 of the packet and I look at the new building examples for upfront capital costs and I'm looking at it's 5.8 million for 50,000 square feet to do baseline fossil fuel system plus carbon fee. But then if they choose to do an air to water heat pump, renewable options, it's 4.8 million. So it's a million less if they take this choice. So it's in the long run, the technology and also the price of fossil fuels is pointing developers in this direction anyway. But curious in terms of the capacity and how those other incentives will overlay Good questions all you're accurate on the incentive structure. That is how we do it. Our goal would be to make sure any incentives that are available now are still available that this doesn't in any way preempt us from offering the incentives. We have precedent for that with the renewable heating ordinance. So we would keep that structure. We referenced that in the memo. In terms of staff capacity, we very much designed this in a way that was aimed at limiting the need for additional staff capacity. There were versions of a proposal that would have required a significant amount of additional staff capacity. In other cities that we studied with with BEI, Boston Denver, they had to ramp up and add staff to implement different proposals. So initially we looked at a performance standard approach and that very much would have, in my view, required additional staffing capacity to be able to work with buildings to monitor individual carbon-reducing or fossil fuel reduction goals on a building-by-building basis. And it's not that we couldn't have done it, or maybe that it didn't have some merit. We ultimately gravitated back towards this idea, both for the reasons I mentioned to Commissioner Herendine about impacting the capital planning and capital investment process, but also because this really is consistent with processes we already do. Our efficiency team is involved in almost any new construction project in the city in terms of doing some great work. Some modeling work, and whatever happens with this can really build off of that. And with the existing buildings, as I mentioned, there's maybe 80 of them. And in most cases, again, we're already engaged. A number of them are using energy start-for-folio managers, managed their buildings, so we have some insight into how they're using energy already. So very much kind of trying to limit the additional strain, not only for BED, but also the Department of Permitting and Inspections, which ultimately is a very important part of the project. And then we have the new buildings, which ultimately would be the implementer and the regulator for the policy. Interesting with this new build example, this is a real-world anonymized building that was built in Burlington, multi-family building. And you can see even without the carbon price, the new construction fossil fuel heating system was 5.2 million. And as you mentioned, there were renewable options in the 4.8 to 4.9 million. The building did not go with any of those options, the conventional system. So it kind of gives credence to the point that having the carbon price might have been a further nudge in the direction of widening the delta between the renewable and the fossil fuel option. But the other point here is operating costs are gonna matter too. And I think a few years ago, if you looked at operating costs for a heat pump relative to a fossil fuel system, the delta was not in favor of the heat pump. With more recent rates included, at least in single-family context, for example, the heat pump now is cheaper to operate than a gas system in Burlington. Now that may be different because there are different rate structures for multi-family for commercial. But the broader point is accurate that the operating cost delta is beginning to diverge a little more in favor of the heat pump. And that I think is important too because there's maintenance and operating costs to consider. So somebody might look at the upfront cost and say, I'm willing to spend a little extra on a boiler instead of a heat pump because I know how to maintain that. I know the operating cost is for that. So there's that hurdle to overcome as well. There's a standard bromide in the energy business going on since the beginning of time. There are energy efficiency investments that pay 40% per year in total rate of return and nobody goes for it. Why not? So it's the old story about getting people's attention. Right. No, understood. I'm just thinking about all the overlapping with the requirement now for efficiency improvements, for rental units, this, there's a lot going on. I'm glad to see also just that the team is, you also have Bill Ward, you have Patricia Wayman. So good to see everybody kind of at the same place and at the same table. It was a good process. We're not done, obviously, but thought it was timely to provide the update and make sure you were aware of what we're proposing and the process kind of going forward. But the last little update I had in the report was, oh, sure. Please, can you have like some non-energy people and non-lawyers read whatever the ballot language is? I cannot. I don't have like five knots. The challenge with the ballot language, because I was looking at this for the resolution is, and we'll try to make it, we're gonna work with the TUC to try to make it succinct. And at least Councillor Barlow is not a lawyer and will work with us on this and bring some good perspective to it. I know Councillor Bergman is a lawyer, but we'll also bring good perspective and they're both members on the TUC who'll be working with us. And City Council President Paul is an ex-officio member. I believe, so we'll have their guidance to help us. But you're trying to fit a lot in and so it can very easily become a compound run-on number of ands in the sentence. And so there's a tension there. On the other hand, with this one in particular, the challenge is we have to get explicit authorization for anything relating to the fee. So we're trying to make sure we don't leave something out inadvertently. And then we go to draft an ordinance with the council and go through that process and find out something wasn't in the authorizing language that should have been. So there's going to be a balance there, but I agree having clear language, but then also we're going to need to do work to explain it and have very clear materials around that too. But point taken. So the last item was just to mention that we had for the first time in several years, our calendar contest winners here at BED. We had a little photo included in the packet of all of our fourth graders. We have calendars. I don't know if you all have received them. I think you did last meeting. We were really pleased to be able to do that in person. Included the photo. We have Vermont Energy Contracting and Supply continues to be a great partner for us in that they provide a $50 check for all the kids who are winners. And they've been their preferred heat pump installer of ours as well, but they have a long standing tradition of sponsoring the event. And Mark Stevenson, who was a long time owner there, sold the business and our new partner there, Nick, is in the photo that I included as well. So we'll look forward to continued collaboration with them as well as our friends at the Lake Monsters Champ, the mayor, others. But it was nice just to have this event in person with American Flatbread sponsoring the pizza and have cake. We had Lori's assistance and a number of others who helped plan out the event. So just wanted you to be aware that we were doing that in person again and it's a great engagement opportunity with the community. Some interesting themes in the calendar this year, a lot of clothes lines, a lot of windmills. And then apparently a lot of focus from what I heard from the folks at Veep on toilet efficiency as well. I don't think any of those made it into the finals, but yeah, we had a lot of clothes lines anyhow. So you never know what the fourth grader is gonna be thinking about in a given year. That's everything I've got. Thank you. Any questions for Darren? No, thank you. Thank you, Darren. Thank you. Next up, we have the financials. Good evening, Emily. Good evening. Here to do the financial review for October fiscal year 23 to date. So we had a net loss for October of $366,000 compared to a budgeted net loss of $629,000. So we performed better than budget by $264,000. Under revenues, sales to customers were $154,000 below budget. For the year to date, however, noting that we're essentially on budget, only $94,000, which is a very small variance. We are seeing commercial sales overall for the year slightly under budget and residential sales slightly above budget even above the sort of COVID bump, sort of long-term people doing more remote work, even above that adjustment that we had budgeted for. Other revenues are primarily EEU, which are offset and expense below. Those were up versus budget by $328,000 this month. I was not a rec delivery month, so we had no power supply revenues as was budgeted. For the year for rec revenues were $258,000 below budget. We expect this variance to worsen throughout the year where we're expecting to see rec revenues in the next delivery quarters, also below budget due to lower production earlier this calendar year. Moving to the expense side, power supply revenues were favorable to budget by $173,000 in October. This is a combination of increased purchase power expense offset by decreased fuel and transmission expense. McNeill was offline for the entire month. Therefore, we had the savings on fuel, but we paid more for power than budget through the ISO exchange as a result. Non-power supply operating expenses were only $48,000 under budget in October, which is basically a timing thing and are pretty much on budget for the year to date as a whole. I'll also note other income, kind of moving to non-operating items now was $84,000 below budget. This is due to the timing of customer contributions to capital projects and the unrealized loss on investments in our construction funds where the unspent revenue bond funds are sitting. And so year to date, we have a net loss of $171,000 that's compared to our budgeted net income of $265, so we are $436,000 off of budget so far. Questions on that? So you're expecting the rec revenue to continue going to negative, but you do expect the overall net income to shift direction? We are hoping that, and we're seeing that even this week that the energy prices, McNeil's now online, running well. It's running. And so we are seeing strong day ahead prices this week with the cold weather even higher than that day ahead in real time on some hours. And the McNeil operations team is sort of monitoring that closely and running up to 52, 53, 54 megawatt hours to capture those real time megawatt hours when they can to, and it didn't keep the plant reliably operating and not stress it, right? But to do that for periods when we're seeing really high prices. So yes, I mean, we think we've got rec revenues sort of breaking against us. We have unbudgeted mystic capacity charges, which we've discussed kind of hitting us. And then we have- Those are called mystic? Well, the plant is mystic. Okay, okay. Got it. So that's what we refer to it. And then, yeah, sort of the change in operating schedule for McNeil, right? So we had planned to be operating McNeil, kind of being net, bringing in net revenue from McNeil, from power supply in October, we haven't to date. So we're monitoring that closely and watching to see like how it catches up over the winter. I would just say like more than any budget that I think I've been a part of at BED, we really are looking at those winter prices as being determinative of how we're gonna end up. So there are some pieces that are against us at the moment. The prices are turning, as Emily mentioned, but it's gonna be, I think for us, a little bit of a roller coaster for the next four months, keeping, making sure McNeil can stay online, making sure we optimize in real time where there are opportunities to do it, but knowing that essentially this budget was built around the idea that there were gonna be higher winter prices and we're beginning to see that materialized, but it hasn't gotten to the point where you're seeing it lined up fully with the budget. We're hopeful that maybe the next month or two we'll demonstrate that. And just to add that James and his team have developed kind of a dashboard of load versus dole, load and resource and sort of the cumulative effect of both in megawatt hours and in dollars of kind of where we are on power supply. And so you can kind of see where we wanted to be and where we are and you can kind of see like the line starting to get back up towards the right spot. So we'll, and that's data that's updated every day, let's update it, updated every day with data for myself. But with a three day lag. Right, but updated daily. So we are watching it very closely and James and Casey Lamont have done a really good job of sort of putting that together to make it easy for us to follow and keep an eye on. I mean, as Darren said, this is really about the prices, energy prices in the second half of December through February and March. And if they come in where we thought, or even potentially higher significant revenue value to us, they come in lower significant lost revenue potential. All of those revenues would be above the cost of the assets, but they're lost potential revenues from the budget. That's basically all around where I presented last meeting. Yep. I'll move to the next page. If there's no other questions. Oops. Okay, so this is capital spending year to date. We have spent 3.1 million versus budgeted of 4.4 million at this point in the year. It's 34% of the budget overall. Not much of note here to report, supply chain challenges are perhaps continuing and perhaps worse than they've been at any point in COVID, really, I mean, we're still seeing those. So that's affecting things, but we are purchasing, we're getting orders in early and trying to be proactive in managing those challenges. And let me go down to cash. So related to sort of monitoring things, cash as of October 31st was 6.4 million. That's compared to a budgeted amount of 7.2. So it's only 83 days cash on hand. That's lower than where we like to be. So that's something we're watching closely. Again, it's a combination of all the things I just talked about. And so with those, again, back to those winter energy prices, if those come in where we had budgeted them to be, that will turn around, but we're in a place now where we've paid out the cash for the wood, for the fuel, right? But we haven't generated the revenue using that yet. So adjusted debt service coverage ratio 1.01 currently for the 12 months ended. And the regular debt service coverage ratio 3.53. Happy to take questions. Thank you. Welcome. So next up, we have McNeil station. 23 projects, excuse me. Discussion and vote. Good evening. Myself, we have cast a measure. The service that's being with me is Altigna Rodney Dollar, our supervisor of generation. And tonight we're going to go over the McNeil joint owners' budgets that was included in your packet for calendar year 23. The draft calendar year 23 expense budget is about 33.887, 121 million as compared to 28, 531, 577 for calendar year 22 budget. The calendar year 23 budget is approximately 5.36 million more than the approved calendar year 22 budget. The increase can be explained by the increase in fuel prices, about 4.75 million. The, in calendar year 22, the wood tons were budgeted for 420,232 tons at the price of $28 per ton. In calendar year 23, we budgeted 397,691 tons with a price of approximately $40 per ton based on the current wood chip markets. The remaining expense budget increase about $610,416 is due to the rising costs of material and labor. The capital budget for calendar year 23 is about 2.85 million as compared to calendar year 22 which was about 2.06 million. Difference of about 7,084, 165 dollars. The main reason for this increase is we're trying to do really two large projects. One of them are the front loader replacement about 675,000 as well as the government control upgrade project which is about 500,000. And of course the labor, the inflation and the labor prices and material prices has increased versus calendar year 22. The calendar year 23, the proposed calendar year 23 budget has been approved by the McNeil joint owners at our meeting in November on November 18. And obviously, if you have any questions we are here to answer them. And of course with us is James Kimmins on Teams. And if not, we are looking really for your vote to approve the budget. Yeah, I'm just curious about the price per ton of wood. And I thought that we had, I thought we'd lock in those prices on a multi-year contract or something like that. Yeah, we did not. That's something that seemed like an awful jump. 12 dollars there, huh? No, we did not multi-year contract for the fuel. We've been using one-year contracts. Further context, we are paying more for wood than we were a couple of years ago. We were paying $27, $28 a ton. We saw with diesel prices going up there was significant upward pressure on the price to get wood to the plant because a lot of, if you're using a truck or looking at the train, diesel's gonna be a key input. And also just with general kind of economic conditions with inflation with a variety of factors, we were not getting the supply that we needed at lower prices, which we did experiment with. And the team came up with a formula that was based around where the wood was coming from, the price of diesel and a few other factors with some modest incentive built in to try to ensure we had the supply we need to run through the winter. And we've kind of settled at this level, that the $48 level. We're hopeful that if pressures ease in terms of fuel prices, some of the economic conditions, we may be able to get that back down at some point in the future, but the overwhelming priority has really been to make sure we have enough wood at the plant. And right now, if you're over there, there's pretty good pile that I know the team's done a good job to build up because there's a period of time where we had prices that were a little lower, where the volumes just were not even at a level that you would need to stockpile for the winter and much less be able to run and replace. So nobody enjoys paying the higher price, I don't think, but we're hopeful that the energy revenues will more than account for that, I think in the grand scheme. What I think I would offer on top of that too, Darren, is of course, Scott, multi-year contracts, unless there's a requirement to deliver, don't really do you any good. If it's voluntary deliveries, you're really going to have to move the price to get the deliveries. We've never been paying enough per ton to impose minimum deliveries on anybody and have them accept the contract. I mean, so if we wanted to move the price up even more aggressively, we could potentially put in minimum deliveries, but we've been avoiding that. The important, I think, message is that the cost is going up about 15% to 16% per megawatt hour because you've got a volume increase and a cost increase. The revenue side is going up 25% per megawatt hour. So this does not represent a material worsening of the position, economic position of the plant, because revenues are moving up too. Yeah, let me. Revenants do appear on the second spreadsheet, but this is the first year we've budgeted, Emily suggested we move to budgeting revenue side. And so I don't have an actual history project for you. The number I'm giving you is a 25% increase over the actual calendar projection over actual calendar 22. So there's a bit of an apples and oranges because actual production in 22 was a bit below budget, but overall it does not look like a worsening of the economic position of the plant to me because of the revenue side. Okay, but we're looking at the budget on the cost side, right? At the moment. When you see changes that are this large, isn't it based on competition and demand for wood, not just the cost of diesel to get the stuff to us? I'm gonna let customers in this market. So it was especially building up for this winter was in response to that competition. There were companies that were paying upwards of 40, $50 a ton. So in order to ensure we actually had enough for this winter run, we had to adjust our prices as well. If you look ahead, can you anticipate that kind of demand is gonna be there? I mean, I'm not sure exactly what the demand is. I just think of people having bigger woodpiles in their backyards than they used to delivered wood that is. There's two components. Sorry. Go ahead. There's two components to keep in mind too, which is the price of the wood itself as a commodity, but the access to trucking is also a problem. The transportation access, because some of these suppliers, as I understand and Betsy's the expert, will divert their trucking to other more lucrative purposes. Okay, but can you, I think you kind of implied that you could separate those two factors. Well, we've moved the pricing to have an index on fuel costs to help mitigate that so that we're not asking them to transport at a loss. And the pricing does have a fuel price that has multiple zones. So the further they transport it, the more we compensate. But at the end of the day, when you're looking at energy revenues of $116 per megawatt hour projected before wrecks and capacity, you've got to do what you've got to do to get the wood because the economic impact of not getting the wood is way, way worse than this. Okay, I'm not complaining. Maybe I'm carrying some baggage. So let me tell you, I've been here around a long time and around here a long time. And we were asked way back when what do we think was going to happen to wood prices? And most people said, but being an environmental pessimist, I thought it was going to go up. It didn't for about 10 years. So, and I thought it was going to be driven by scarcity because as an environmental pessimist, I think we're running out of everything. So now I'm seeing changes that seem so fast that scarcity is kicking in. And I'm just wondering, should I worry about that? Or am I not even interpreting what I see correctly? Again, go ahead. This is why you're going to fuel costs. I mean, yeah, we had a diesel increase by 300% between February and May. And diesel is a material cost of our delivery people's business. So again, this is not, I don't know that anything can be interpreted from this just yet in terms of long-term. I mean, I think of all the supply chain disruptions and all of the volatility in all of the fuel side of the business, the energy, natural gas, electricity, diesel, right? I mean, at the end of the day, we are reacting to decreasing volumes of deliveries by increasing the price. I mean, so and not having the wood to run over the winter would be economically disastrous potentially. Okay, no argument there. As a comparison, other low-grade markets, pulp mills were paying $60 a ton. So just to give you a reference, low-grade market to low-grade market. But does that mean they're willing to pay more so they're competing with us because? They just make money and sell the pay $60 per ton. Well, if their business model for, say, doing paper products and things like that will support a higher cost per ton than the electric market, then they can out-compete us price-wise. Okay, but economics on our once is, it also has to do with what the sellers say. They can get the price because demand has increased or the supply has shrunk or shrinking. I'm just, and I'm trying to, I'm trying to get an easy answer, which of course is not fair. Yeah, I think it's not fair, Bob. I don't think there's an easy answer to this one, unfortunately. About our supplier base, that is a component. We are seeing a reduction in our overall supplier base. That's so you could answer that to the exact quantity, but we went from something like 80 to 100 suppliers during our peak to 45 to 55 suppliers. So if that helps you with your question, supplier base, not scarcity of wood in the forest, but supplier base, the folks getting the fuel to the mills, transferring that product, it's there are less people doing it right now in our region. The workforce. There was also a question at one point around people wanting to know what our price was gonna be so they were planning jobs and whether those jobs were gonna be economic. And so I think we had a decision point of, earlier in this year of looking at, making sure that we could get the wood we needed, making sure that people were gonna go out and do those jobs, knowing where our variable was relative to the broader variable of going out and doing the job. But yeah, I don't think we've had, not aware of any wood shortage, but there has definitely been more pressure on us economically to get the wood at the prices that you're seeing now. And it would certainly be my hope longer term that they do come back below the 40 level back into something more akin to what we've seen historically. And the price at the 40 level is not a permanent change. It is a combination of a diesel fuel adjustment and an incentive adder to make sure that we maintain the volume we needed to run through the winter. So we haven't permanently moved our price per ton up to that level. But we're running about 7,500 tons a week of delivery and we'll burn, I think it's 12 or 13,000 tons at full load. So we're trying to pace ourselves to make sure that we have full fuel supply through the February, March window. It's taking us a little while, I think because it was probably three, four years ago when someone from New York state came here in person saying he couldn't get a contract. And we always hear that the wood forest, wood product industry is caving in. There's not enough demand. There's only Rygate and McNeil. So I think, I mean, peeling back the layers to clarify, it's not about the wood product. It's about the bodies to move the product and then the cost of diesel and then inflation generally. An interesting thing that's he just confirmed, Mr. Loire is one of our largest suppliers right now. Really? Well, we did promise him it would turn around. And we would offer broad, broader contracting. And I think we've done that too. Interesting. He's probably benefiting also from the zonal pricing on the diesel because we recognize the further distance needs. While ferry ride. Right, yeah. Good. Other questions? Okay, so this is a discussion and a vote recognizing that the joint owners voted on November 18th and I'll be interested to hear through the grapevine where we land next year for dollar per ton. But this is a discussion and vote if someone feels comfortable to make a motion. Motion to approve the 2023 year budget for new generation station. Second. All in favor. Aye. Aye. Aye. Thank you, everybody. Thank you. So last is the commissioner's check-in. Any comments? Nope. I had five of them, we've touched on all five. Okay, I just want to say to you all you guys are an amazing team. You really, any other board that I might share in my life will not be this responsive and intelligent and dedicated and hardworking. And I really appreciate all of your work. So thank you. Thanks a lot. Thank you. Thank you. And a motion to adjourn. So moved. Second. All in favor? Aye. So I do have one question. You are the chair. And so that means when we meet in jail and I was wondering if it was going to happen this time.


Open Source project called Eclipse Che, which I'm the project lead for. Now the concept of Eclipse Che was to make it easy for us to allow anyone at any time from anywhere to contribute to a project without having to install any software. So really lowering the barrier of entry to project contribution to zero. Now this is a pretty interesting problem because today in most organizations the CI part of what we do is continuous and it is used. That's what people are doing. But on the development side, it is not continuous at all. In fact it's highly disjointed. We all run local machines. We have our own IDEs. We have our own runtimes. We grab our own dependencies and packages. There's not a lot of sharing and the sharing that's there is typically through instructions on a wiki or something else not very efficient like that. So this is a problem because you need to actually onboard developers. And this doesn't just mean when people are hired. This means at any time when you need help on your project. This could be when you're using a new API and you need to grab somebody from that API team to help guide you on how to use it best. It could be when you have a new contractor coming in. There's lots of times when you need to bring somebody into the project team kind of quickly. The double problem with this, so the reason why it bites you twice is that not only does it slow down the ability of that person to actually begin contributing code but typically the people who help somebody new get onboarded into a project are your leads. They're the experts. So the new guy isn't contributing and now the expert isn't contributing too until they've got that guy onboarded. Second problem is the classic, well it works on my machine. I don't know, why doesn't it work on yours?  It shouldn't happen, right? We have the technology at this point to kill this problem if we could just let go of certain things that we haven't let go of yet. And then the last thing is that the intellectual property which is the source code which is why we as developers are valuable to our organizations is really hard to secure on a desktop. Talk to anybody in security about whether they would rather try and secure a thousand desktops or a thousand user on a central IT hosted system and they will always choose the latter. So we did a survey of several hundred developers and asked them how long does it typically take you to onboard a new developer? And you can see that by and large it was between two to five days but look at that 20% said between six working days and 13 working days. That's two weeks before somebody is actually efficient and contributing to the code. That's brutal because the code should be moving forward rapidly at all times. You want agility, you want, that's what we're doing here. We're doing agile software. We're trying to do DevOps. And yet this is problem persists. And in fact when you look at studies that have been performed nearly 25% of the time that a dev team spends is actually spent on this death by a thousand cuts of maintaining a runtime, maintaining the environment, coordinating who's got what dependencies. Am I supposed to upgrade? Am I not supposed to upgrade? What version is prod on? What version is staging on? What version am I on? All that stuff. And lastly, as I said, the desktops are difficult to secure. Now the project files in the runtime is really the IP. It's the app. It's the key. And yet that's the part that's hard to share and hard to secure. So really common solution people turn to is, well, okay, let's standardize the desktop. All my developers are going to get the same desktop. They're going to get the same image. They're going to have to use the same tools. And that really bugs developers because you want to use the tools you want to use. You want to be able to install things on your machine.  Like a lot of times you need that in order to do your job. So this is not a good solution. It's also not a good solution because fundamentally it still uses the desktop. And that still has sharing control and scale limitations. And you're not solving that by standardizing it.  So the real solution is to create a shareable and secure workspace. And that needs to be a centrally hosted workspace.  And the reason why those things need to be together is because that is everything the developer needs in order to be productive, in order to actually get into the code and contribute. So I'm going to show you in a second here is Eclipse Che running on OpenShift. And the end result is the instantaneous ability to get into a code base and begin contributing. And when we've done the studies, it looks like about 30% to 40% improvement in the amount of time a team spends on these kind of tasks. So that's enough talking. Let's get back to my Chrome, to my... So this is my magic URL. This URL is essentially like a bookmark, so to speak, to a template of the environment that my project team needs in order to be useful to contribute. So if anybody new comes onto my team, whether there's somebody new to your organization or somebody just from another team, all I have to do is give them this URL. So I do that, drop that into my browser. And now what's happening is that behind the scenes on my OpenShift install, a pod is being created and populated with the operating system, the Java app server, the database, any other runtime dependencies that I need in order to actually run my app. Maven is being installed because I need that to build my app. Debuggers are being installed. Language services are being installed. SSH clients being installed. Everything that I need as a developer in order to interact with my app is being installed. Then the source code is going to get cloned into this pod and everything now can be built, edited and run.  People see that.  In order to make this truly zero install, we actually open up the Eclipse Shea browser-based IDE. Now that doesn't mean you have to use a browser-based IDE. You can use SSHFS, for example, local mount, use your desktop IDE and just connect to the pod and use it for build and run. But the nice thing about having a browser-based ID as an option is that for folks who don't have a local IDE setup, or whose local IDE is set up to use with a different project, can still quickly code review or quickly contribute to somebody else's project. It's also great for product managers, great for docs, great for QA, folks who may not have a desktop IDE all set up for them. So here I am. You can see I've got my app right here. It's a fairly simple application. Let me just pull this down. But even so, I've got autocomplete and it's smart enough to know that I'm at the package level there and that I'm at class level here. I've got language services. I can do refactoring, move, rename. I can navigate the file structure. I can search. Let's actually look at something a little more interesting, the inherited file structure. I can jump to another class, scan through it. So all the things that I would expect of my IDE are here. So this is not just a toy. This is something I can actually use for development. I've got integration, subversion integrations. So let's go back to the greeting controller. And now let's say I want to see what this does. So I want to do a build and run. And you can see down here at the bottom, this is now the command that was sent into the pod that has everything that I need in it. You can see that it's doing a Maven clean install and it's going to deploy that to Tomcat. Now this is going to take a second. And once it's done, I'm going to use that blue link right here to open up the app running inside my personal pod. Now you remember that URL at the beginning? If I'd given that to 100 people on my team, they would each get their own individual pod, but every pod is exactly the same. So there is no concern now about runs on my machine, doesn't run on your machine, because now we're all using the same pod. So my Maven build is done. Now I'm starting up the actual app server. And we are good. This may take a second more. There we go, let's zoom this in a little bit. All right, this is a super complex app. But there we go, I've got my Hello World. So that's kind of cool. And all this is running in MiniShift. So I'm going to stop this. I'm going to go and make my change. All right, this auto saves. So all I need to do now is do yet another build and run. Now what's kind of cool about that is that this particular URL, the one for my running app running in my pod, I can of course give to anybody else who has network access to that pod. Now this is kind of cool and it's a bit of a mind bend, because now I don't need to commit and push or do a pull request in order to get feedback on my code. I'm working in a local copy right now inside my pod. I can give this to my product manager and say, can you tell me all the ways in which I have failed and I need to make changes before I go and push this? And now I can do it while I'm still in the right branch, still kind of in my flow before I've gone and pushed, before I've gone and done my pull request. I don't need to redo anything. So I need to just kind of go through that. Now in a second here, we've got our startup again. I'm going to reopen this and I'm going to do a different name and there we go. Now we're super internationalized. So very basic, but very cool. So the last piece of this puzzle is let me come back to here and let me go back into my workspaces. Let me add a workspace. Now you're maybe thinking, okay, this is all a nice pre-canned kind of demo Brad, but there's actually more to it than that. There's a lot more you can do. So sure I have all these pre-canned stacks available to me and in ChaseSpeak, a stack is a combination of the various run times and dependencies that my project would need. So this is kind of everything other than my source code. Now so you can see I've got ones for Node, Wildfly, Vertex, Java, MySQL. Now this one is quite cool because this is now a multi-pod environment. So now as a developer, I actually have the ability to be dev-ing in a two-pod, three-pod, ten-pod environment all networked together. Kubernetes and OpenShift are going to make sure those things start in the right order and I can still go and edit and change code on any one of those locations. So I can be working on a complex microservices environment that is personal to me, even if it is scaled too large to fit on a laptop. Now of course, I can create any of these stacks myself just by going into Add Stacks and then I can create something totally custom with exactly the run times and the systems and components that I need for my project. Once it's done, once again, I can grab one of those magic URLs, pass it out to my friends and co-workers and bang, everybody's on the same page and everybody is doing exactly what they need. Now, if you want to give this a shot, which I would strongly recommend, you can go to the Eclipse Chay site. Now this is an Eclipse project, so this is all open source of course, all free. If you go to eclipse.org forward slash chay, you go to the main page and if you go into our docs, all right, so there's the docs. I can get started now by going down to OpenShift installation and you'll see that I can install this on MiniShift. I can install this on the full OpenShift container platform. I'm using MiniShift here because it's easier. It just runs on my laptop. I can kind of play with it there but obviously running it on the OpenShift container platform is a lot more powerful because now I can share this with my whole team. Now the one caveat is we are this close to having multi-tenancy in Chay, which is obviously a kind of critical part for doing it for my team. So in November, in just a few scant weeks, we'll be releasing a version of Chay with full multi-tenancy using Key Cloak, which gets you OAuth and LDAP, for example, authentication, running in OpenShift container platform or MiniShift. So at that point now I have everything I need to have a fully horizontally or vertically scalable set of developer workspaces for my team tied into my authentication all nice and clean. Really can change the way you work as a development team. In the meantime, if you're interested, I would strongly suggest coming, trying the OpenShift installation on MiniShift, try it on your laptop and just kind of play with it. It's a pretty cool tool. Obviously I'm a little bit biased as the project lead but nonetheless, those I was saying today we've got the single user on OpenShift which is great for a MiniShift install. Going forward, we're going to have multi-user which is perfect for the larger OpenShift container platform. Now the last piece of the puzzle is that Chay is also being integrated into the set of end-to-end developer tooling which is used by OpenShift. We're calling it OpenShift.io. And if you're interested, you can do a workshop here in 15 minutes or later today or tomorrow, where you can actually play with building a brand new project in Java, editing it, building it, rebuilding it, staging it and deploying it in OpenShift. It's actually a lot of fun but it really covers all the elements that you need as a whole team. Everything from work item tracking through the editor, through Jenkins, through deployment. All right, that does it for me. Thank you very much. If you guys have any questions, I'll be hanging out here for a bit. Otherwise, please do join us for our workshop. Thank you.