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IMEA Board Meeting Dec 12, 2024 “Highlights”

Posted on Modified on by Greg Hubert

Note: The posting below is a copy/paste of an email report to the NEST Energy Committee, where the formatting characteristics of the original email change when copy/pasting from Microsoft Outlook using the WordPress editor.

Now also note that the City of Naperville has begun to publicly post its report on IMEA board meetings through the City Manager’s Memorandum process. Previously, the IMEA board meeting reports were shared with City Council through a non-public communication referred to as the Friday Confidential. Here is: MM – Dec. 19, 2024.

Hello Energy,

Sharing my “highlights” from the Thursday December 12 IMEA Board Meeting:

  1. Sustainability Plan Update
  2. Decommissioning Fund for Coal Plants Approval
  3. Transmission Ownership Update
  4. Prairie State – Legal and Operations
  5. Some Additional Noteworthy Items

The link to a copy of this meeting’s presentation slides pdf is:
https://drive.google.com/file/d/1boJlwFb091jDcq1d-G3luohDDYbZjOsD/view

The links to the CLEAN historical collection of board meeting slides, agendas, minutes, resolutions, monthly financial reports, etc. is posted on the CLEAN Sources and Resource webpage:
https://cleanenergynaperville.org/sources-and-resources/imea-board-and-other-imea-records/

The link to IMEA’s board meetings webpage is:
https://imea.org/IMEA%20Board%20Meeting%20Schedule.asp
IMEA is now keeping older meeting records posted on the website, including meeting packets, but not the slides.

1. Sustainability Plan Update (slides 72 -83)

  • IMEA provided the first annual update / progress report on the IMEA Sustainability Plan (which is the plan that had been formally adopted at last Dec’s IMEA board meeting and then posted on the IMEA website at: https://imea.org/IMEA%20Transition%20to%20the%20Future.html
  • Slide 73 documents that the 130 MW solar goal has been exceeded
  • Slide 75 has further info on the 2025 battery storage study

Note: Our Naperville electric director asked clarifying questions at the previous day’s Exec Board meeting. IMEA further clarified that:

  • 177.5 MW of additional solar has been contracted
  • The battery study report is planned to be completed by the Dec 2025 IMEA board meeting (which is when we should anticipate another annual update / progress report on the sustainability plan)
  • Summer of 2026 is targeted for the “public process” development of the next sustainability plan

2. Decommissioning Fund for Coal Plants Approval (slides 57 – 59)

  • The IMEA board approved resolution 24-12-934 to begin collecting for decommissioning funds for Prairie State and Trimble County
  • At the Aug board meeting, the board had agreed with the recommendation to collect the “majority” of the funds needed by October 1, 2035
  • Collection starts on May 1, 2025 and runs through April 31, 2035
  • Initial estimate of the amount to be collected is $21.7 million, assuming a 3% interest rate for the funds held in the Decommissioning Account
  • Average member residential customer bill impact is projected to be $0.47 per month
  • Plans are based on Prairie State retirement in 2045, TC Unit 1 in 2045, and TC Unit 2 in 2050

Note: As in the IMEA Sustainability Plan, IMEA continues to report a 2050 retirement for Trimble County Unit 2 without telling the full story that other sources apparently are not in alignment with that 2050 date:

LG&E and KU plan to burn coal for another four decades
https://www.lpm.org/news/2022-01-12/lg-e-and-ku-plan-to-burn-coal-for-another-four-decades
… but it still plans to continue burning coal and natural gas in Kentucky for another three decades, slowly retiring the remaining 11 coal-fired generating units until it finally closes the last one in 2066.
That plant is the Trimble County Generating Station. LG&E completed it in 2011. Sinclair, vice president of energy supply and analysis for LG&E KU, said it could be one of the last remaining coal plants in the country at that time. 

2023 PPL Corporation Sustainability Report (PPL owns LG&E and KU)
https://www.pplweb.com/wp-content/uploads/2024/04/PPL_Corporation_2023-Sustainability-Report_FINAL.pdf
> We have committed to achieve net-zero carbon emissions by 2050.
> We are on track to achieve interim targets of 70% reduction by 2035 and 80% reduction by 2040.
> We have committed to not burn unabated coal by 2050.

3. Transmission Ownership Update (slides 11 – 20)

  • IMEA has been offered the opportunity to become a minority 25% owner of a project involving a 23-mile section of the Ameren Illinois transmission system
  • The project will increase system reliability for IMEA members Princeton and Peru.
  • ATXI is the Ameren Illinois transmission company that is the majority owner.
  • Proposed agreement looks similar to Ameren Missouri’s agreement with Missouri Public Utility Alliance (MPUA). MPUA is also one of the joint owners of Prairie State.
  • IMEA seeks to lower the overall costs of transmission to IMEA members by earning transmission revenues to lower the net costs of transmission to all IMEA members.
  • IMEA revenues will come from the MISO/FERC Attachment “O” cost recovery methodology with an expected rate of return near 10%
  • $15 – $20 million in ownership costs are expected to be funded through tax-exempt bonds, where the funds to repay the bonds would also come from those Attachment “O” funds and not from the IMEA members.
  • IMEA will keep the board informed of timeline and action steps as needed

During further questions/discussion:

  • There will be further “robust conversation” with the board at the April board meeting
  • IMEA has been looking for transmission opportunities for a long time, and this is the “first real one we’ve been offered”
  • IMEA will provide a pro forma estimate of the costs and benefits
  • The net revenues will provide a net credit to IMEA’s bucket of costs for transmission that are socialized among all IMEA members
  • Rate of return provided by MISO/FERC Attachment “O” is based on investment costs

4. Prairie State – Operations and Legal (slides 30 and 40)

Operations:

  • Unit 1 had unplanned (“forced”) outages in October and November
  • Unit 2 had 2 forced outages in October
  • Unit 1 now has a planned outage, expected back online this weekend
  • Unit 2 had a planned outage in late November and then failed to come back online due to a trip cause by a generator protective relay. Now expected to be offline for the next 2-3 weeks
  • No updates on carbon capture

Legal:

  • In the Prairie State vs Illinois EPA case (PCB No. 25-11), the verbal news (not on slide 40)  shared that last Thursday the Pollution Control Board (PCB) ordered  that the Illinois EPA (IEPA) has 1 year to complete the review of the permit and 2 years to issue a final permit
  • In the Sierra Club vs. Prairie State case (Case No. 3:23-cv-00919), on Nov 20 Prairie State filed a motion to stay proceeding

Note: Based on these above Prairie State outages and the outages reported at Trimble County (slide 29), it suggests there have been times in Nov-Dec that all of IMEA’s coal-fired generators have been down (and the lights did not go out). US EPA Air Markets data for Nov-Dec will probably not be available to confirm the concurrent outages until sometime in Q2 next year.

5. Some additional noteworthy items

Note: Here are some but not all noteworthy items for everyone, so please review the slides.

  • President and CEO Reports (slides 7 – 10)
  • Winnetka’s new IMEA board member representative, Nick Narthi, was welcomed. Nick replaces Brian Keys who is retiring at end of year.
  • IMEA President & CEO chaired Nov’s APPA Climate Change Committee in where the discussions included recently proposed US EPA regs on natural gas and long-term reliability concerns
  • IMEA expects to present, at the at the Feb 2025 board meeting, a final resolution for approval of the IMEA bonds refinance. Plan is to refinance the remaining 10 years of debt over the same 10 year period, saving $20-25 million
  • Legislative and Regulatory Report (slide 21)
  • Illinois Lame Duck session is scheduled for Jan 2-7
  • Net metering meetings on-going
  • December meeting scheduled with sponsor of HB5021
  • Operations (slides 22 -28)
  • PJM 2026/2027 base residual auction delayed 6 months to adjust market rules to address prices and uncertainty
  • MISO planning resource auction: window opens 3/26/25 and results will be posted 4/28/25
  • IMEA staff working with MISO on Load Modifying Resource (LMR) changes that will impact IMEA Behind-the-Meter (BTM) resources. New filing on rules now expected sometime in Q1 not January
  • PJM is changing the way it communicates wind curtailments. Work continues with all parties, including IMEA operations
  • Trimble County (slide 29)
  • Unit 2 planned outage complete “slightly behind schedule”
  • FEED study for stack replacement to be completed by summer 2025
  • Preliminary results of FEED study “expanded scope of work” for FY 2027 and beyond
  • IMEA Flora Capital Project (slide 34)
  • Cost estimate for a $500K control system update to be added to the IMEA 2025-2026 capital budget
  • Solar Project Updates (slide 36 – 39)
  • Marshall and Princeton expected to be online by end of 2024, Oglesby in spring of 2025
  • Verbal only update of the SolAmerica USDA Pace solar projects and growing concerns about the funding from USDA given the coming changes in Federal administrations
  • Legal (slides 40 – 43)
  • Prairie State related cases described above in item 4
  • IMEA continues to closely monitor cases involving PJM co-location of generators and data centers case for impact on IMEA. Rulings potentially could  impact IMEA member resources in Winnetka and Rock Falls.
  • IMEA REC Program (slides 45 -47)
  • IMEA reports producing a total of 342,348 RECs from IMEA resources in REC Planning Year 2024
  • IMEA retired the same amount of less expensive RECs associated with other resources in Illinois and neighboring states, saving IMEA $10.47

Note: IMEA’s handling of RECs to be able to make legal claims of renewable energy is described in our CLEAN Lack of Transparency document. Each year we also request from IMEA the detailed list of retired RECs and post the details in our IMEA RECs directory.

  • Demand Response Program and changes (slides 48 – 56)
  • Revised Risk Management Policy (slides 61 – 63)

Note: The risk management policy details in resolution 24-12-936 can serve as a resource to learn more about IMEA responsibilities in PJM and MISO. Copies of IMEA resolutions are included in the IMEA board meeting packets now posted on IMEA’s website. Our CLEAN collection of historical and current resolutions, once adopted signed, is in our IMEA Board Resolutions directory

  • Electric Efficiency and Conservation Program and changes (slides 64 – 67)
  • EV Charging and EV Program and changes (slides 68 – 71)

—–

As mentioned earlier, there also was an IMEA Exec Board meeting held on the previous day Wed Dec 11. When there’s an Exec Board meeting on the day preceding the regular board meeting, I don’t write a highlights report on the Exec Board meeting. The CLEAN historical collection of board meeting records does include agendas and minutes of all these meetings too.

And finally, webinar means not having to devote a whole day commuting to and from Springfield to attend. Again, I urge you to please make it a priority to attend IMEA board meetings. IMEA does not provide us with recordings of the meetings, and there is no requirement to do so under current law. When we advocate for transparency, showing up at board meetings is an important sign that our actions match our words.

  • The IMEA board meetings webpage tells us the next scheduled meeting is an Exec Board meeting on Jan 22, 2025 at 10:00AM. Next full board meeting is Feb 20, 2025 10:00AM, preceded by an Exec Board meeting on Feb 19, 2025 at 2:00PM.
  • Webinar registration info is posted within the IMEA meeting agenda document files, which have typically been posted by IMEA by Friday of the preceding week.
  • The board meeting packets have been showing up late Monday or early Tuesday on the IMEA webpage, even though IMEA apparently provides the IMEA board member reps their copy of the packet a full week ahead of the meetings.

Thanks.

Greg

IMEA Board Meeting Oct 24, 2024 “Commentary”

Posted on Modified on by Greg Hubert

Note: Apparently IMEA will not provide us a copy of the video for everyone to watch, so I am now publishing this citizen commentary on IMEA’s Resource Planning presentation. It represents a copy/paste and edited consolidation of two emails to the NEST Energy Committee, where the formatting characteristics of the original emails change when copy/pasting from Microsoft Outlook using the WordPress editor.

Instead of a “highlights” report, my two emails to the NEST Energy Committee were my commentary on the IMEA board meeting’s Resource Planning presentation by the IMEA President and CEO.
We had received a copy of the slides in advance of the board meeting with the ask that we watch IMEA’s board meeting presentation to give the slides “proper context” before we offered comments.
I had waited to post with the expectation that IMEA would provide full transparency with a recording, so that all who could not attend the board meeting including our city council would have the same “proper context” opportunity to also use to evaluate my commentary as well as any by NEST too.
Please be aware that IMEA is not legally required to provide recordings of board meetings. And now IMEA is telling me in writing that no such record exists, even though the board meeting webinar indicated that a recording had started for a meeting that was set to be recorded.

Energy,

At this time, I’ve decided not to provide a report of last Thursday’s [Oct 24] IMEA board meeting highlights.  Instead, this is my personal commentary on that IMEA board meeting’s resource planning presentation. It represents my opinions, notes, and citizen knowledge of IMEA.

A copy of the resource planning slides extracted from the full set of board meeting slides is available here. I did not try to compare against the slides we previously received the week before the board meeting.

In my opinion, the presentation at the end of a long meeting was too fast and too full of one-sided stories that I’m not gonna repeat. Please, I encourage you to discuss with others who attended the webinar. And I also ask that you join me in making your own request to Naperville and IMEA to provide public access to IMEA’s video recording of the board meeting’s presentation.

My 5-part commentary [originally 4 with part 5 added in the second email]:

First and foremost: IMEA continues to offer us no apparent efforts or plans to consider alternatives that would support turning down the dial on that coal-fired ownership generation.

  • Nothing is apparently planned until such time as required by State or Federal legislation or regulations. 
  • We also learned earlier in the board meeting that Prairie State continues to pursue funding of the carbon capture “experiment”.  The Prairie State report slide listed: “Potentially explore the U.S. Department of Energy (DOE) Office of Clean Energy Demonstrations (OCED) for funding for carbon capture technology (NOI for funding issued by DOE)”

Second: IMEA continues to claim that IMEA makes resource decisions in open and transparent meetings. But I’ll assert that they are “forgetting” to tell the whole story when … .

When omitting mention of:

  • The apparent lack of involvement and opportunities for input from our elected city council representatives, not to mention citizen stakeholders who are the “public” in public power.
  • Apparently closed committee meetings in the development of the IMEA sustainability plan which was publicly revealed to us at the end of October 2023 IMEA board meeting after it was already developed
  • Closed planning meetings such as the 2 days of closed IMEA board meetings in Nov 2019 for which the full meeting minutes continue to be voted by the IMEA board to be withheld from the public nearly 5 years later

Third: With the addition of the latest 150 MW solar project, there is no apparent room in the resource portfolio for further clean energy resources without …

  • without turning down the dial on that coal-fired generation, or
  • without an increase in IMEA power supply demand to be able to add to the resource portfolio.

My notes recorded a statement by the IMEA CEO that the IMEA portfolio now allows you Members to watch and wait as technologies develop before choosing new resources. Seems to me that also tells us in Naperville that we should also watch and wait before signing any IMEA contract extension.

Fourth: As I explain further, IMEA’s description of PJM accredited capacity requirements seems to also leave out the whole story.

And it may be highly misleading when using language such as: PJM requirements  to have maximum peak load capabilities plus reserves. But I also acknowledge that I could be wrong in my understanding, and perhaps my research as an amateur citizen may be faulty. I’ve shared my research with our Naperville Electric Director, and it’s my understanding that he will discuss with IMEA. I’ll share with you what I hear further.

  • It’s my assertion that it’s an IMEA business decision whether/how to hedge (offset) the PJM market prices for capacity. These are costs that IMEA must pay through the PJM Locational Reliability Charge. Instead, IMEA words seem to state that it is PJM requirement that IMEA have the accredited capacity to meet IMEA peak load plus reserves.
  • My research plus evidence from IMEA’s Sept 2023 PJM settlement statement tells me that it’s IMEA’s responsibility as a Load Serving Entity (LSE) to pay for its share of the costs of the accredited capacity resources that are committed through the PJM capacity market processes. These processes are referred to as PJM’s Reliability Performance Model (RPM).  And the costs are paid by all PJM LSEs, including IMEA, through the PJM Locational Reliability Charge which is calculated using summer peak
  • An LSE may choose (but is not required) to offset all or part of the Locational Reliability Charge. One way is to offer owned resources in the capacity market and/or to use bilateral contracts to obtain RPM Auction credits. These credits offset the Locational Reliability Charge. In the Sept 2023 IMEA PJM settlements statement, there was such an RPM Auction credit of $447,853 that served to offset a substantial portion of the Locational Reliability Charge of $532,859
  • For IMEA, it is a business decision whether, how, and how much to hedge (offset) the market price for capacity as reflected in the Locational Reliability Charge. And in times of volatile capacity market prices, there may be even further reasons to choose to do so. But it is not a PJM requirement that IMEA must acquire accredited capacity. And it is not a PJM requirement that would directly prevent IMEA from adding renewable energy resources to its portfolio.

At the end of the day, IMEA does not tell us the whole story of accredited capacity nor does IMEA provide continued transparency to the related PJM charges and credits that are hidden/buried inside IMEA Purchased Power totals in the IMEA financial statements.

Further sources and details on IMEA’s PJM accredited capacity requirements and PJM charges to IMEA for its LSE share of accredited capacity are listed at the end of this email.

Fifth: In the concluding part of his presentation, the IMEA President and CEO repeated the disinformation on IMEA keeping the lights on.  

  • It’s disinformation that we have debunked and that I believe we must continue to debunk because apparently it’s still useful and effective for IMEA to keep repeating.
  • As he concluded his presentation, the IMEA President and CEO talked about IMEA managing the energy markets and the times when the wind doesn’t blow and the sun doesn’t shine.
  • Then he described IMEA staff in the IMEA control room 24 x 7 every day of the year “optimizing which resource  … the best cost … and keep the lights on for all 32 of our members … for the long term”.
  • Please I urge all of you to keep refuting this IMEA disinformation. It’s PJM and Naperville Electric that keep the lights on in Naperville, not IMEA.

Further below are resources to refute IMEA keeping the lights on:

—

Ending this email with a repeat of my ask that you discuss with others who attended the webinar.

And please also request a copy of the recording. Didn’t we hear that this is supposed to be open and transparent IMEA?

Thanks.

Greg

Further sources and details on IMEA’s PJM accredited capacity requirements and PJM charges to IMEA for its LSE share of accredited capacity:

Open Access Transmission Tariff
Attachment DD
Reliability Pricing Model
5.1 Introduction
https://agreements.pjm.com/oatt/5141

In accordance with the Reliability Assurance Agreement, each Load Serving Entity is obligated to pay a Locational Reliability Charge for each Zone in which it serves load based on the Daily Unforced Capacity Obligation of its loads in such Zone.  An LSE may offset the Locational Reliability charge for a Delivery Year, in whole or in part, by: (a) Self-Supply of Capacity Resources in the Base Residual Auction or an Incremental Auction; (b) offering and clearing Capacity Resources in the Base Residual Auction or an Incremental Auction (but only to the extent of the additional resources committed to meet Unforced Capacity Obligations through such Incremental Auction); (c) receiving payments from Capacity Transfer Rights; or (d) offering and clearing Qualifying Transmission Upgrades in the Base Residual Auction.

Reliability Assurance Agreement
Schedule 8
Determination of Unforced Capacity Obligations
https://agreements.pjm.com/raa/4176

A. For each billing month during a Delivery Year, the Daily Unforced Capacity Obligation of a Party that has not elected the FRR Alternative for such Delivery Year shall be determined on a daily basis for each Zone as follows:
Daily Unforced Capacity Obligation = OPL x Final Zonal RPM Scaling Factor x FPR
Where:
OPL = Obligation Peak Load, defined as the daily summation of the weather-adjusted coincident summer peak, last preceding the Delivery Year, of the end-users in such Zone (net of operating Behind The Meter Generation, but not to be less than zero) for which such Party was responsible on that billing day, as determined in accordance with the procedures set forth in the PJM Manuals, and as adjusted further to include the Obligation Peak Load associated with any Large Load Adjustment that may be allocated to the Party
Final Zonal RPM Scaling Factor = the factor determined as set forth in sections B and C of this Schedule
FPR = the Forecast Pool Requirement

PJM Manual 18: PJM Capacity Market
https://www.pjm.com/directory/manuals/m18/index.html#about.html

Two line items in IMEA’s Sept 2023 PJM settlements statement:

Charges for IMEA’s share of the costs of the accredited capacity resources that are committed through the PJM capacity market processes which may be offset by credits from the RPM Auction for self-supplied resources (owned and contracted resources)

Locational Reliability Charge of $532,859.70

From PJM Manual 18:
All LSEs pay a Locational Reliability Charge equal to their Daily Unforced Capacity Obligation in a zone times the applicable Final Zonal Capacity Price.
LocationalReliabilityCℎarge = DailyUCAPOblig * FinalZonalCapacityPrice
Each LSE that serves load in a PJM Zone or load outside PJM using PJM resources (Non-Zone Network Load) during the Delivery Year is responsible for paying a Locational Reliability Charge equal to their Daily Unforced Capacity Obligation in a Zone times the applicable Final Zonal Capacity Price for that Delivery Year.

My calculations to “unwind” / determine the average daily IMEA capacity obligation:
2023/2024 Final Zonal Capacity Price for ComEd: $34.18 MW-day
$532,859.70 divided by 30 days in Sept = $17,761.99 per day (avg for Sept)
$17,761.99   divided by $34.18 MW-day = 519.66 MW per day (avg daily unforced capacity obligation for Sept)

RPM Auction credit of $447,853.80

From PJM Manual 18:
RPMAuctionCredits = MWClearedLDA * RCPLDA
Each generation, demand, energy efficiency, or QTU resource provider that clears Capacity Performance sell offer segments in an RPM Auction will receive a Daily Auction Credit equal to the total MW amount that cleared in Capacity Performance sell offer segments times the applicable LDA  resource clearing price in such RPM Auction for the entire Delivery Year.

My calculations to “unwind” / determine the accredited capacity that cleared in the auction
2023 – 2024 BRA Resource Clearing Price (RCP) for Rest of RTO: $34.13 / MW-day
$447,853.80 / 30 days = $14,928.46 per day (avg for Sept)
$14,928.46  / $34.13 per MW-day = 437.40 MW-day (sold in the RPM auction)

Resources to refute IMEA keeping the lights on:

IMEA General Counsel’s words at the Winnetka IMEA presentation:
https://www.youtube.com/watch?v=4NpC9Fzbz8o&t=1981

“..and when the RTOs were first created
they really were thought of as controlling the wires
and controlling discriminatory issues about the wires

but what they really turned into is protecting the reliability of the wires
making sure there’s power flowing through the wires

and the way that they decided to do that was
to start an energy market and a capacity market
to control how the generators that connect to the wires are dispatched

so that we have a constant continuous flow of electrons flowing across the grid

so the grid doesn’t fall down and the lights don’t go out

so the RTOs essentially these days do all that stuff …”

PJM’s 3 priorities webpage with priority #1: Keeping the Lights On
https://learn.pjm.com/three-priorities

Al Karvelis’ Aug 20 public comments at city council.
https://youtu.be/R1UzGX23gOQ

My 3-part public comments in 2023 at city council: