The Imperial Irrigation District Board of Directors held their regular meeting on Feb. 1 where most of the agenda focused on energy matters and cost adjustment that was reviewed by the board.
As the national market changes, the IID has to adjust to continue providing the services to its customers and also provide programs that will help locals, especially in the summertime when electricity is used the most during those critical hot months.
In 2021, California’s power supply had been limited, impacting IID’s ability to import energy, which resulted in substantially higher costs. The IID’s 2021 purchase power and fuel cost had been budgeted at $207 million before the energy shortages. The projected costs were revised at $283 to $289 million for the 2021 year to reflect those power supply limitation impacts.
As a result, the purchasing power and fuel cost increase resulted in a higher energy cost adjustment factor on customers’ bills. To recover the increase in costs, the ECA billing factor was stabilized in 2021 to minimize customer impacts during the summer high consumption months.
For the board’s acceptance, the preliminary 2021 actual fuel and purchased power cost and ECA revenues collected to cover this cost have been determined and summarized.
The preliminary actual fuel and purchased power cost for 2021 are $285 million. As authorized by the board, project funds earmarked for decommissioning of a total of $10 million were utilized to fund the 2021 cost under-recovery.
ECA revenues collected through the stabilization of the ECA billing factors and the utilization of the remaining ECA Balancing Account balance were sufficient to cover the cost for the 2021 year, resulting in no over/under collection for the year.
In related energy items, the board heard a presentation about the summer 2022 Peak Demand Reduction Program.
The state of California’s public utility commission and energy commission has reported that the state has relied heavily on out-of-state power imports to meet the high demand for electricity during the summer months. Access to those imports can be hampered during those critical months and cause energy shortages throughout the state can be hampered during those critical months and cause energy shortages throughout the state. In preparation for the summer months, IID has created an Emergency Load Reduction Program seeking participation from its largest commercial electricity consumers that have peak demands of 1,000 kW or higher.
The program is designed to encourage energy consumption reduction during hours of peak demand in the summer months of June through September of 2021 to relieve stress on the IID grid to prevent energy shortages. Customers participating in the program would be asked to reduce the load for 2 hours during critical peak hours between 5 p.m. and 9 p.m. A compensation of $10 per kW that is reduced during a load reduction event will be applied to the customer’s electric bill. The program has been designed comparable to other existing load reduction programs offered by other utilities in the state.
The estimated cost of this program is between $200,000 to $1.2 million for a 1,000 kW emergency load reduction.