Groups Urge Treasury Department To Offer Guidance On COVID Relief Utility Assistance Taxation
September 20, 2021
by Paul Ciampoli
APPA News Director
September 20, 2021
The American Public Power Association (APPA) has joined with 16 other organizations in asking the Department of Treasury to issue guidance clarifying that residential utility assistance funded through the Coronavirus State and Local Fiscal Recovery Fund (CSLFRF) is not includable in individual income.
Treasury has issued similar guidance relating the Emergency Rental Assistance Program but has yet to do so for CSLFRF.
In a Sept. 15, 2021, letter organized by APPA and sent to Treasury’s office of the Undersecretary for Domestic Finance, the groups said they were writing in strong support of allowing utility assistance to households or populations facing negative economic impacts due to COVID-19 as an eligible use of CSLFRF as provided under Treasury’s Coronavirus State and Local Fiscal Recovery Funds Interim Final Rule.
“There is a question as to whether such assistance to residential households and other non-business utility customers is includable in income,” APPA and the other groups noted. “As a result, households receiving such assistance must consider themselves at risk of additional tax liability and/or a decrease in income-based benefits, such as the Earned Income Tax Credit.”
The groups said that this question is also of concern to agencies, departments, and utilities implementing such assistance programs because they would be required to report this assistance as income to the Internal Revenue Service.
While the Feb. 1, 2022 deadline for filing such reports “seems distant, program managers must start making decisions on meeting such requirements now,” the letter pointed out.
“Finally, this needlessly raises complicated tax administration issues, such as the allocation of the value of assistance to multi-family households and the issuance of information returns to customers without, or without a known, Social Security or taxpayer information number,” the groups went on to say.
The groups believe that the Internal Revenue Code already indicates that disaster assistance, such as that provided under CSLFRF, is not includable in income. However, guidance mirroring that provided for the Emergency Rental Assistance Program at: https://www.irs.gov/newsroom/emergency–rental–assistancefrequently–asked–questions would provide needed assurances to program beneficiaries and program managers, the letter said.
LES Proposed Rate Decrease Would Mark Fifth Straight Year Without Rate Hike
September 19, 2021
by Paul Ciampoli
APPA News Director
September 19, 2021
The Lincoln Electric System (LES) Administrative Board’s Budget and Rates Committee recommended a systemwide decrease to retail electric rates in the 2022 budget and rates proposal during LES’ Administrative Board meeting Sept. 17. This would mark the fifth consecutive year without a rate increase for the Nebraska public power utility.
The rate decrease proposed for 2022 is about 1% systemwide, though most retail rate classes will see little to no change in their rate. Some residential customers may see minor changes to their monthly bills due to continued realignment of energy and facilities charges. Some large customers may see a decrease based on changes in LES cost to serve those customer classes.
The total proposed 2022 budget of $293.9 million allots $247.7 million for operating costs and the remaining $46.2 million for capital projects. This proposed budget is $12.2 million less in capital projects and $5.7 million less in operating costs than the 2021 budget.
Reductions in the 2022 budget compared to 2021 are primarily due to reductions in power costs and depreciation. In addition, the capital budget is lower following completion of the LES Operations Center.
The LES Administrative Board will take action on the 2022 budget and rates at its Oct. 15 meeting, after which it will be submitted to the Lincoln City Council for review.
Construction Set To Begin On Virgin Islands Water and Power Authority Undergrounding Project
September 19, 2021
by Paul Ciampoli
APPA News Director
September 19, 2021
Construction is set to begin this week on the first electrical underground project in St. Croix, Virgin Islands, the Virgin Islands Water and Power Authority said on Sept. 17.
Undergrounding of equipment in and around the Wilfred “Bomba” Allick Port and Transshipment Center at Krause Lagoon is a $2.5 million federally funded project with financial resources provided by the Federal Emergency Management Agency and the U.S. Department of Housing and Urban Development. J. Benton Construction Inc. is the contractor on the project, which aims to provide critical facilities with electrical equipment that is less vulnerable to hurricanes and windstorms. The work entails trenching and conduit installation.
“The undergrounding of facilities in critical areas is key during storm restoration and other emergencies,” said Virgin Islands Water and Power Authority Interim Executive Director Noel Hodge said the Authority is excited about beginning construction on this very important mitigation project on St. Croix. Interim Executive Director Noel Hodge. “The ports are critical to the movement of materials and supplies into the territory after a disaster and providing facilities that can lead to more efficient power restoration, bodes well for the future.”
Hodge noted that in April, Virgin Islands Water and Power Authority broke ground on this and two similar underground electrical projects, in Golden Grove and Midland, “and we are now set to proceed with the start of construction on Tuesday.”
As with similar electrical undergrounding across the territory, the Container Port project will replace existing overhead electrical lines and equipment with underground equipment. “This lessens damage from future hurricanes and windstorms and also ensures more efficient service restoration in the aftermath of a natural disaster,” Hodge said.
Similar electrical undergrounding projects are slated for St. Thomas and St. John as part of a larger strategic transformation of the territory’s electrical and water utility.
OPPD Promotes Troy Via To Newly Created Position of COO, Vice President For Utility Operations
September 19, 2021
by Paul Ciampoli
APPA News Director
September 19, 2021
The Omaha Public Power District (OPPD) Board of Directors recently promoted Troy Via to the newly created position of Chief Operating Officer and Vice President for Utility Operations, effective Oct. 31.
Via is currently Vice President for Energy Delivery at Nebraska public power utility OPPD, having served in that role for the past three years.
He joined OPPD in September of 2013 as the Director of Energy Marketing and Trading. During his five-year tenure in that role, Via played a lead role in OPPD’s integration into the Southwest Power Pool and the District’s entry into the day-ahead market.
He actively engaged in enterprise risk management, including the development of OPPD’s derivative strategy. He has contributed significantly to economic development and played a key role on OPPD’s resource planning team. In addition, Via led the corporate Integrated Energy Marketplace strategic initiative.
In his new position, Via will provide overall leadership, strategic planning and long-term objectives for OPPD’s energy production and energy delivery groups. He will also oversee the ongoing decommissioning of the Fort Calhoun Station, a nuclear power plant that was shut down permanently on October 24, 2016.
The role will oversee the main energy operational capabilities to ensure OPPD’s continued commitment to affordable, reliable, and environmentally sensitive energy services.
Prior to joining OPPD, Via held progressively responsible positions with Dominion Resources and Aquila Energy.
He holds a bachelor of Business Administration degree with a focus in Finance from the University of Central Missouri.
WAPA Desert Southwest Region Agrees To Participate In CAISO’s Real-Time Energy Market
September 19, 2021
by APPA News
September 19, 2021
The California Independent System Operator (CAISO) on Sept. 15 signed an implementation agreement with the Western Area Power Administration Desert Southwest (WAPA DSW) region to participate in CAISO’s real-time energy market in 2023.
Operated by CAISO, the Western Energy Imbalance Market (EIM) footprint currently includes portions of Arizona, California, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming, and extends to the border with Canada.
WAPA DSW sells federal hydroelectric power and provides transmission service to nearly 70 municipalities, cooperatives, Native American tribes, federal and state agencies, and irrigation districts. One of those cooperatives, the Arizona Electric Power Cooperative (AEPCO), is comprised of six electric distribution cooperatives and five public power entities that combined serve more than 420,000 residential, agriculture, business and industrial customers.
The agreement applies to WAPA’s DSW region and Western Area Lower Colorado Balancing Authority. The latter includes generation resources in the Boulder Canyon and Parker-Davis projects (PDP) and the transmission systems of the Central Arizona Project, PDP and the Pacific-Northwest-Pacific Southwest Intertie Project.
In addition to the AEPCO sub-Balancing Authority area, participating Balancing Authority entities include the Central Arizona Water Conservation District, Southwest Public Power Agency and other DSW customers in Arizona, southern California and southern Nevada.
By 2023, the Western EIM will have 22 entities representing 84%of the demand for electricity in the Western Electric Coordinating Council (WECC), a non-profit corporation that works to advance a reliable electric system in 14 Western states, Northern Baja Mexico, and two Canadian provinces.
WAPA annually markets and transmits more than 25,000 gigawatt-hours of renewable power from 57 federal hydroelectric powerplants owned and operated by the Bureau of Reclamation, U.S. Army Corps of Engineers and International Boundary and Water Commission in 15 western and central states. WAPA also owns, operates and maintains a more than 17,000 circuit-mile high-voltage transmission system in the West. It is part of the Department of Energy.
U.S. Storage Market Continued To Grow In The Second Quarter Of 2021
September 16, 2021
by Paul Ciampoli
APPA News Director
September 16, 2021
According to Wood Mackenzie and the U.S. Energy Storage Association’s (ESA) latest US Energy Storage Monitor report, 345 megawatts (MW) of new energy storage systems were brought online in the second quarter of 2021.
This is an increase of 162% over the same quarter in 2020, making the second quarter of 2021 the second-largest quarter on record by MW for U.S. energy storage additions. An unprecedented volume of storage will come online in in the second half of the year, with Wood Mackenzie expecting that storage projects representing over $5 billion of investment will come online in 2021 alone.
Details on the report were released on Sept. 9.
Despite positive market momentum in the U.S., the residential battery storage market dipped slightly, the first drop for the segment in nine quarters (since Q4 2018). Equipment constraints, including an ongoing Tesla Powerwall shortage, is hampering the segment’s growth despite the proliferation of new residential storage players, the report noted.
The non-residential segment, which consists of onsite storage and community-scale storage, saw quarter-on-quarter deployments rise by 31%, driven by the growth of the community storage market in Massachusetts.
The front-of-the-meter (FTM) market deployed 218 MW/729 megawatt hours (MWh) in Q2 2021, with California, Texas and Arizona leading the segment. California continued to lead the front-of-the-meter segment in Q2, with Arevon/Capital Dynamics’s 100MW/400MWh Saticoy Energy Storage peaker plant replacement in Ventura County, Calif., contributing most of the MW for the quarter. Solar-plus-storage projects in Texas and Arizona also bolstered Q2 front-of-the meter capacity.
Meanwhile, policy support continued to build in Q2, with several new state incentives introduced for residential and non-residential storage. The industry also still awaits the outcome of budget reconciliation, expected this winter, which could include a solar investment tac credit (ITC) extension and/or standalone storage ITC. A positive outcome would upgrade the energy forecast across all segments, Wood Mackenzie and ESA said.
Blue Ridge Power Agency Issues Battery Energy Storage System Request for Proposals
September 16, 2021
by Paul Ciampoli
APPA News Director
September 16, 2021
Virginia-based Blue Ridge Power Agency (BRPA) has issued a request for proposals (RFP) in which the joint action agency seeks pricing for several battery energy storage system (BESS) configurations that will aggregate to form a portfolio of BESS assets.
BRPA members are non-profit entities from six municipalities, towns, two cooperatives, and a university located in Virginia, each of which owns and operates its public power electric distribution system.
There will be four member projects participating in the RFP for this BRPA portfolio. The locations in the RFP will be strategically spread out across four members to capture benefits from BRPA’s member demand side management (DSM) activities.
The BESS sites are contemplated to be at locations provided by Craig Botetourt Electric Cooperative in Virginia, City of Radford, Va., City of Salem, Va., and Virginia Tech Electrical Services.
BRPA is seeking competitive proposals for a BESS to support BRPA’s DSM activities.
As outlined in the RFP, BRPA is looking for pricing for several BESS system configurations (2, 5, and 10 megawatt capacity ratings) that will aggregate to form a portfolio of BESS assets.
BRPA intends to select these configurations based on site-specific costs and project evaluation criteria. Commercial operation for the BESS is scheduled for June 2023.
Potential respondents can request the RFP and other information by contacting BRPA’s consultant, GDS Associates, Inc. Questions concerning the RFP should be directed to the following email address: BRPA.2021BatteryRFP@gdsassociates.com
Proposals in response to the RFP are due Nov. 1, 2021.
The American Public Power Association’s Public Power Energy Storage Tracker is a resource for association members that summarizes energy storage projects undertaken by members that are currently online.
Ditto Writes In Support Of Bond And Tax Credit Provisions In Legislation
September 15, 2021
by Paul Ciampoli
APPA News Director
September 15, 2021
In a Sept. 14 letter to House Ways and Means Committee Chairman Richard Neal, D-Mass., Joy Ditto, President and CEO of the American Public Power Association (APPA), applauds the infrastructure financing and energy-related provisions of the tax titles of the Build Back Better Act that are being considered for adoption this week by the committee.
“These provisions will reduce the cost of financing infrastructure investments overall and ensure that all electric utilities, including APPA’s not-for-profit members, can benefit from incentives intended to encourage critical energy investments needed to transition to cleaner generating technologies. This will make these incentives fairer and more effective,” wrote Ditto.
She noted that state and local governments and the enterprises they govern use municipal bonds to finance public infrastructure investments that enable their communities to function and thrive. Tax-exempt municipal bonds have financed $2.3 trillion in new investments in infrastructure over the last decade, including $68 billion in new investments in electric power generation, transmission, and distribution.
In Subtitle F (Infrastructure Financing and Community Development), the Build Back Better Act “includes hugely important provisions to improve tax-exempt financing, including reinstating the ability to issue tax-exempt advance refunding bonds and increasing the small-issuer exception threshold from $10 million to $30 million,” Ditto wrote.
Increasing the small issuer exception to $30 million will make it more attractive for banks to invest in rural and other smaller communities. And in the five years prior to their repeal in 2017, public power utilities refinanced $20 billion in existing debt with tax-exempt advance refunding bonds — generating interest savings of more than $600 million for the communities they serve, Ditto said.
Likewise, Subtitle G (Green Energy) “takes transformational steps to making energy-related tax provisions more efficient and fairer,” the APPA President and CEO said.
Federal tax expenditures are the primary tool Congress uses to incentivize energy-related investments. “However, such incentives do not work for tax-exempt entities (including public power utilities). That means public power utilities are effectively locked out of owning such facilities – and explains why 80 percent of the nation’s (non-hydropower) renewable energy generating capacity is owned by for-profit, merchant generators,” wrote Ditto.
Subtitle G addresses this inequity by allowing for the direct payment of energy production and investment tax credits and carbon capture tax credits to any entity that owns the project. “This would remove the financial disincentive for public power utilities to own such facilities, which are needed to transition to cleaner generating technologies and to address climate change. That means local projects, under local control creating local jobs. It also would allow the full value of these credits to pay for additional investment or be passed on to our 49 million customers,” Ditto said.
She thanked Neal for his “continued commitment to helping local communities find and finance local solutions” and said that the changes in bond financing and energy-related tax credits that the Ways and Means Committee is considering this week “will give our communities the best, most flexible tools to address the substantial challenges that lie ahead.”
The committee was expected to complete work on the tax titles of the Build Back Better Act, also known as the budget reconciliation bill, on Wednesday, Sept. 15.
CPS Energy, Austin Energy Send Crews To Help With Power Restoration
September 15, 2021
by APPA News
September 15, 2021
Texas public power utilities CPS Energy and Austin Energy are sending lineworkers to Houston, Texas, to help with power restoration efforts in the wake of power outages caused by Hurricane Nicholas.
On Sept. 15, Austin Energy said that it has sent lineworkers and support personnel to Houston to help with restoration efforts. Twenty-three Austin Energy team members departed Austin on the morning of Sept. 23 with bucket trucks and other equipment to help bring power back for affected communities. The team is prepared to provide help for at least a week in Houston and the surrounding area, Austin Energy said, noting that it received the request for mutual aid from investor-owned CenterPoint Energy. Click here for a video of Austin Energy crews departing for Houston.
Austin Energy noted that safety is always its top priority and deploying aid during a pandemic requires extra care and consideration. “To ensure the safety of our employees, our crews will only work with other Austin Energy staff, staying with their same team members and following established COVID-19 safety protocols. Additional safety measures are also taken into consideration when setting up lodging for the crews,” the utility said.
Meanwhile, CPS Energy crews and support staff left San Antonio on the morning of Sept. 15 to assist with power restoration efforts for those in the Houston area affected by what was Hurricane Nicholas, which has since been downgraded again to a tropical storm.
In response to a request from CenterPoint Energy, CPS Energy is sending more than 30 employees to include overhead linemen, pole crews, fleet personnel, safety teams, and management to help with widespread power outages resulting from the hurricane. CPS Energy also released several contract crews to free them up to help with assistance too. CenterPoint expects the crews to be needed for up to five days.
With wind speeds reaching 45 mph, Nicholas left hundreds of thousands of Houston area residents without power. On Sept. 15, CenterPoint Energy reported that it had restored service to more than 380,000 electric customers, down from a peak outage count of 460,000 at 8 a.m. CT on Sept. 14 and that it was down to less than 80,000 customers without power.
CPS Energy crews were traveling to CenterPoint Energy’s staging area at the Sam Houston Raceway Park, where they will receive their power restoration assignments.
Keys Energy Services Sends Transformers To Houma, Louisiana, To Help With Post-Ida Restoration
September 15, 2021
by Paul Ciampoli
APPA News Director
September 15, 2021
Florida public power utility Keys Energy Services (KEYS) is sending 60 power transformers to Houma, Louisiana, to assist Terrebonne Parish Consolidated Government Utilities with post-Hurricane Ida power restoration.
On Tuesday, September 14, KEYS crews loaded the power transformers onto a semi-trailer truck that will deliver the equipment to Houma, La.
“At KEYS we are well aware of the challenges utilities face in restoring power after a major weather event,” said KEYS’ General Manager and CEO Lynne Tejeda.
“While boots on the ground do the physical work of restoring power, equipment shortages can adversely impact their progress. KEYS was not called on to assist with post-Hurricane Ida restoration efforts, but the shipment of these transformers will assist restoration efforts and help to light the path to recovery for our fellow citizens in Gulf Coast,” she said.
“Florida public power, and particularly Keys Energy, has been impacted time and time again from hurricanes,” said Amy Zubaly, Executive Director of the Florida Municipal Electric Association.
“We understand the importance of not just relying on mutual aid crews for help with restoration but the need for materials and supplies beyond what we normally have on hand. We’re proud to be able to help another public power in need however we can,” she said.