CITY OF LOS ANGELES INTER-DEPARTMENTAL CORRESPONDENCE

Transcription

1 FORM GEN, 160 CITY OF LOS ANGELES INTER-DEPARTMENTAL CORRESPONDENCE Date: August 24, 2009 To: From: Subject: The Mayor The Council Miguel A. Santana, City Administrative Officer ~ C. ~ AMENDMENT OF ELECTRIC RATE ORDINANCE NO TO CORRECT AN ERROR - STUDIO CITY TEMPERATURE ZONE CHANGE Summary On August 6, 2008 (C.F ), the City Council approved the restructuring of the Electric Rates to include tiered rates based on temperature zones for the first time in the City's history. DWP recommended two temperature zones for residential customers in the City of Los Angeles due to the varying temperatures and the effect of higher temperatures on the energy use to run the basic household appliances such as refrigerators, TVs, ceiling fans and lighting. The use of air conditioning is not factored in any comparisons since it is not a basic household necessity. The variance used by DWP is fifteen degrees, which can affect the overall consumption of these basic appliances by increasing overall energy use by as much as 143 kilowatts (KWh). Based on the temperature data, the varying temperature and the effect of higher temperatures on the energy use to run household appliances, the City was divided into two temperature zones for residential customers. The temperature zone designations were established using the data provided in the "Spatial Analysis of Summer Average Daily Maximum Temperatures in the Region of Los Angeles" report conducted by the University of California, Los Angeles (UCLA) in February Zone 1 encompasses zip codes whose average temperature during the four summer months of June to September is below 80 degrees and Zone 2 encompasses those zip codes with an average temperature above 80 degrees during those same four months. The zip code approach was the most feasible method of implementing temperature zones for DWP customers. City Council approval of the restructured electric rates included a requirement that DWP validate and update the zone designations by conducting a new study. DWP selected AECOM Environment (AECOM) out of three climotologists to perform the validation and update study. During the validation portion of the study, AECOM discovered that two of the four Studio City zip codes adjacent to the 80 degree zonal demarcation line were incorrectly included in Zone 1 instead of Zone 2. The average temperature data for Studio City in the UCLA study indicated that the average temperature for all four zip codes was In addition, a preliminary analysis of the same four Studio City zip codes by AECOM indicated an average temperature of Therefore, it is appropriate that the Studio City zip codes and be moved from ZO/l(3 1 to Zone 2 and the other two Studio City zip codes should remain in Zone 2 (see attached Zone assigments from the proposed the rate ordinance). City Council app~oval i~ rtfwired per Charter Section 676. " ',J "

2 - 2- RECOMMENDATION That the Mayor approve Resolution No , adopted by the Board of Water and Power Commissioners recommending the amendment to the Electric Rate Ordinance No , to correct an error by authorizing a temperature zone change for Studio City Zip Codes and from Zone 1 to Zone 2 and return the request to the Department for further processing, including Council consideration. FISCAL IMPACT STATEMENT The proposed action will have no impact on the City's General Fund. Approval of the proposed temperature zone changes will have a minimal impact on the DWP revenue. Since the Department is only bound by the City Debt Management Policies, the City Financial Policies are not applicable. TIME LIMIT FOR COUNCIL ACTION Pursuant to Charter Section 676, "Rate Setting", approval of energy rates set by the Board of Water and Power Commissioners is required by the Council. Action to amend the temperature zones must be approved by Ordinance. The Charter does not specify a time limit for this action by the Council and Mayor. MAS:OAV:

3 - 3- ATTACHMENT Zones Zones in Schedule R-1, Rate A for Residential.Service are determined by the Customer servce. Zip Codeas shown. in tables below. ZONE ZONE 2* 'Owens Valley is included in Zone 2

4 Mr. Miguel A. Santana City Administrative IL ~JMni een~ ANTONIO R. VlLLARAIGOSA Mayo, Commission LEE KANON ALPERT, President EDITH RAMIREZ, PiCII President FOjlliSCEE HOGAN ROWLES JONATHAN parfjlliy THOMAS S. SAYLES BARBARA E. MOSCHOS, Secretary H. DAVID NAHAl, Chief &ec:utive Officer and General Manager August 6, 2009 The Honorable City Council City of Los Angeles Room 395, City Hall Los Angeles, California Dear Members: Subject: Amendment of Electric Rate Ordinance No for Studio City Temperature Zone Change ~cjl" _~'1:'~:!J'" if_ :,,,,,---lj?, {,,-,;:ra',,_,._c:_ Pursuant to Charter Section6;7'Q\"ejicl6sed'"fo?IIp'prQ.Y~F~YYQW'HonorableBody is Resolution No , aq;6pt~dby..the'b6afaoftwat&f;ahil~p'ower Commissioners (Board) on August 4,2009, approved as to form and legality by the City Attorney, recommending amendment to Electric Rate Ordinance No , to provide for a temperature zone change for Studio City Zip Codes to Zone 2. As directed by the Board, transmitted to you are supporting documents. If there are any questions regarding this item, please contact Ms. Winifred Yancy, Manager - Government and Neighborhood Relations, at (213) , or Mr. Gregory Black at (213) Sincerely, Barbara E. Moschos. Board Secretary BEM:rg Enclosures: LADWP Resolution Board Letter (Ordinance transmitted under separate cover) Water and Power Conservation... a way of life 111 North Hope Street, Los Angeles, California 90012~2607 Mailing address: Box 51111, Los Angeles Telephone: (213) Cable address: DEWAPOLA n~ ~ and made fran recydedwasla '0<7

5 c/enc: Mayor Antonio Villaraigosa Ms. Jan C. Perry, Chair, Energy and the Environment Committee Mr. Gerry F. Miller, ChiefLegislative Analyst /' Mr. Miguel A. Santana, City Administrative Officer V Mr. Rafael Prieto, Legislative Analyst, CLA Mr. William R. Koenig, Chief Administrative Analyst Ms. Winifred Yancy Mr. Gregory Black

6 LADWP BOARD APPROVAL..-. _...- LETTER TO: BOARD OF WATER AND POWER COMMISSIONERS DATE: July 27, 2009 SUBJECT: Amendment of ~~ Electric Rate Ordinance ~~ _ 3rl.:::i. No ; Temperature Zone Change RAMMI'f fv'\j H. DAVID NAHAl to Add Studio City Zip Codes to Zone 2 Chief OperaHngOfficer Chief Executive Officer and General Manager /l/h~t~ JEFFERY L. PELTOLA Chief Financial Officer FOR COMMISSION OFFICE USE: CITY COUNCILAPPROVAL IF YES,BY WHICHCITY REQUIRED: Yes!21 No 0 CHARTERSECTION: 676 PURPOSE: Attached for your approval is a resolution, approved as to form and legality by the City Attorney, amending Electric Rate Ordinance No to add the Studio City Zip Codes to Zone 2. }rf 2008, the City Council approved the Rate Restructuring that included tiered rates and temperature zones. When the restructured rates were approved, questions were raised regarding the inclusion of Studio City in Zone 2. As a result, Los Angeles Department of Water and Power (LADWP) conducted, through an independent third party, an analysis to validate whether the Studio City mean average temperature in the summer season averages greater than 80 degrees. Preliminary analysis under the AECOM Environment (AECOM) validation study includes four Studio City Zip Codes adjacent to the 80 degree line of zonal demarcation. The AECOM review of data.from surrounding sites with the later period of record indicates that the re-analysis for North Hollywood is representative of current conditions in the Studio City area. Utilizing the temperature monitoring site in North Hollywood, the summer average daily temperature is Based upon this finding, Studio City area Zip Code numbers 91601, and should remain in Zone 2; and Zip Codes 91602, and should be moved from Zone 1 to Zone 2.

7 Board of Water and Power Cornmlssloners Page 2 July 27,2009 BACKGROUND: The Electric Rate Ordinance was restructured and approved by the Board of Water and Power Commissioners on August As a part of the Electric Rate Restructuring, residential rates were modified to include tier rates with temperature zones and baseline allocations based upon a Scientific Study. The study mapped summer average daily temperatures for microclimates of the City of Los Angeles and was performed by the Department of Atmospheric Sciences at UCLA. The study delineated two temperature zones for the City of Los Angeles based on average temperatures less or greater than 80 degrees. These geographic areas were established to ensure that there are no subsidies between the two geographic zones. Zip Codes with a summer average daily temperature lower than 80 degrees were assigned to Zone 1, while those Zip Codes with a summer average daily temperature greater than 80 degrees were assigned to Zone 2. An ED4 waiver was received by the Mayor's Office. COST AND DURATION: The remaining Zip Code zone allocations established based upon the UCLA Study and previously approved by the Board of Water and Power Commissioners and City Council, shall remain unchanged until the full temperature validation study is completed. There will be no cost to the LADWP to implement this revision. FISCAL IMPACT STATEMENT: Not applicable. RECOMMENDATION: It is recommended that your Honorable Board adopt the accompanying resolution, which if adopted, would approve the amendment to Electric Rate Ordinance No DET:cah Attachments clatt: H. David Nahai Raman Raj Richard M. Brown Aram Benyamin James B. McDaniel Jeffery L. Peltola Cecilia K T. Weldon Maria Sison-Races Gregory J. Black George Z. Chen

8 RESOLUTION NO WHEREAS, the Board of Water and Power Commissioners (Board) at its September 2, 2008 meeting and the General Manager requested an analysis of temperature zones setforth in the City's Electric Rates Ordinance No (Ordinance); and WHEREAS, the Department of Water and Power of the City of Los Angeles (Department) has analyzed summer average daily temperatures in Zone 1 and Zone 2 of the Ordinance utilizing temperature data through 2006, and recommends that properties located in Zip Code numbers and 91604, in the Studio City area, should be changed from the Zone 1 temperature zone to the Zone 2 temperature zone. NOW, THEREFORE, BE IT RESOLVED that the Board recommends that the City Council adopt an ordinance amending the City's Electric Rates Ordinance and figures as substantially follows to wit: in words ORDINANCE NO. _ An ordinance approving the amendment of rates previously fixed by the Department and charged for electric energy distributed and for service supplied by the Department to its customers, by amending Ordinance No THE PEOPLE OF THE CITY OF LOS ANGELES DO ORDAIN AS FOLLOWS: Section 1. That the rates to be charged and collected and the terms, provisions and conditions applicable for electric energy distributed and for electric service supplied by the Department of Water and Power of the City of Los Angeles to its customers for use within the Los Angeles Metropolitan area, fixed in Resolution No. -,- adopted by the Board of Water and Power Commissioners on is hereby approved. Ordinance No is amended as follows: Sec. 2. The definition of the word "Zones" of Subsection 0 of Section 25 of Ordinance No is amended to read:

9 Zones Zones in Schedule R-1, Rate A for Residential Service are determined by the Customer Service Zip Code as shown in tables below. ZONE ZONE 2' 'Owens Valley is included in Zone 2

10 Sec. 3. The City Clerk shall certify to the passage of this ordinance and have it published in accordance with Council policy, either in a daily newspaper circulated in the City of los Angeles or by posting for ten days in three public places in the City of los Angeles: one copy on the bulletin board located in the Main Street lobby to the City Hall; one copy on the bulletin board located at the Main Street entrance to City Hall East; and one copy on the bulletin board located at the Temple Street entrance to the los Angeles County Hall of Records. I hereby certify that this ordinance was passed by the Council of the City of los Angeles, at its meeting of _ JUNE A lagma Y, City Clerk By ~--~ Deputy Approved Mayor Approved as to Form and legality CARMEN ATRUTANICH, City Attorney By ~~~~~~ Assistant Date File No.. City Attorney _ BE IT FURTHER RESOLVED that this matter is forwarded to the City Council for approval by ordinance. I HEREBY CERTIFY that the foregoing is a full, true, and correct copy of a Resolution adopted by the Board of Water and Power Commissioners of the City of los Angeles at its meeting held AUG APPROVED AS TO FORMAN!) lemu1v ROCllAltD J. ~~ki!!a~ib\,o, ~ITYATTORNEY Bvl~ Ass1stant ClIy AUomey i}~u~~f.~~ Secretary

11 Zones Zones in Schedule R-1, Rate A for Residential Service are determined by the Customer Service Zip Code as shown in tables below. ZONE ZONE 2* "Owens Valley is included in Zone 2