July 2023 Board Meeting Summary
SDCEA Board Meeting Summary, July 31, 2023
Support of Geothermal Drilling – The Board passed on a 4-2 vote, a resolution in support of Mt. Princeton Geothermal, LLC seeking funding to establish the viability of expanded geothermal energy in central Chaffee County (resolution link here: Resolution No.1 – July 2023). The resolution discussion was added to the agenda at the beginning of the meeting.
Author of the resolution, Dan Daly, said it is in SDCEA members’ interest to explore efficient, reliable, and carbon-neutral energy sources and to support the effort to find the seed money to prove or disprove the existence of the potential energy resource at the site.
Director Charlie Abel said he was not comfortable supporting the resolution, as the scope of the project is unknown.
CEO search process – Applications for SDCEA’s open CEO position closed on July 17. About 30 applications were received by SDCEA’s executive search consultant group. The board will meet with a representative to review screened applications on August 17. Interviews of candidate finalists are expected to take place in September.
Rates – The board discussed a desire to convene a board-education rate-making workshop as soon as practical, potentially in September.
System capacity study – The board approved an agreement with engineering firm Toth & Associates not to exceed $60,000 for a system capacity study to determine the maximum amount of solar power generation that can be accommodated on the segments of SDCEA’s electric distribution system.
Special Capital Credits Retirement – Capital credits are the members’ equity in the co-op. Each year SDCEA allocates operating margins (profits) back to members who paid an electric bill. Each fall, the board determines if SDCEA is financially able to “retire” capital credits to the membership. This is called a general retirement. General retirement is usually for a specific year(s) and for a specific amount.
SDCEA’s software now allows a special capital credit retirement to apply only to members who left SDCEA with an uncollectable balance on an account.
As capital credits are applied to uncollectable accounts, this allows SDCEA to pay off or reduce uncollectable account balances using the capital credits allocated to that member. Accounts to which this program applies are not active. Special retirements have no effect on SDCEA’s equity or cash balance.
SDCEA completed a special capital credit retirement for the first time in 2022 for $102,456.60. The SDCEA board approved a special retirement of $6,575.09 for 2023. This amount is lower than the previous year due to the reduction of uncollectable accounts in the previous year.
Employee Culture Assessment Survey – The board approved $5,150 toward a 5–6-week project for an online employee survey and an executive summary of results conducted by the National Rural Electric Cooperative Association Market Research group.
Grant program – The board discussed US Department of Energy and US Department of Agriculture grants that could be applied to certain projects on SDCEA’s system, such as installing a battery to the Trout Creek Solar array south of Buena Vista.
Year-to-date (June 2023): Revenues are 4% over budget due to selling more power than forecasted in the budget, driven by colder than anticipated January through May. The 2023 budget is based on SDCEA’s year over year average of kwh sales, with a slight increase for growth in number of consumers and sales. Because January-May 2023 was colder than January-May of 2022, more kilowatt hour sales (4.3% higher) have occurred than budgeted. The cooperative in turn purchased additional power to cover this increase in sales. This increase was primarily offset by a decrease in operating expenses due to several employment positions being open and lower than budgeted interest expenses on long-term debt. Overall, total expenses are within 1% of the budget.
Wildfire Mitigation Update:
Cutting crews are working in Lake County and the Beaver Lakes subdivision. A crew will be working in Fremont County along Texas Creek.
Project Totals since inception:
Total Trees Removed – 9231
Total Trees Trimmed – 2243
Hazard Trees Removed – 175
Tommy Young line rebuild: Phase I of the Tommy Young line rebuild continues in Fremont and Custer Counties.
• Length – 7.9 miles
• Contractor – Altitude Energy
• Contract Price – $694,347 (labor only)
• Duration – 32 weeks (about 7 and a half months)
The first five miles of this project are complete. The remaining 2.9 miles of line reconstruction is under construction Phase II will begin in the fall. Steel poles will be used in certain applications. If a Department of Energy grant request is awarded, some of the money will be used to offset the costs of this project.
Executive Session: The board adjourned into executive session to discuss items to be held in confidence at 5 p.m. The meeting was reconvened at 5:40 p.m. A motion carried for the SDCEA Board of Directors to ratify Interim CEO Gary Kelly’s decision for SDCEA to become a Class C member of Basin Electric. The meeting adjourned at 5:45. No action was taken in the executive session.