The city-owned utility has 4,149 electric customers. No state law requires citizen approval or input in the expenditure of cash from electric-fee revenues, which will fund the purchase.
The City Commission voted unanimously Aug. 27 to purchase the meters by mere motion. Resolutions and ordinances can be forced to referendum or special election by 20 percent of city voters, but motions by the board cannot. Therefore the purchase is probably a done deal.
There was no information in the agenda packet on the purchase and the price was given verbally–not in writing–by City Manager Morris Madrid just before the vote. Even if the public could have learned of the action by reading the packet before the meeting, there was no public input allowed.
Neither the city nor the electric department analyzes the data from its analog meters to find transmission leaks in the city-owned $7-million business. Yet the city will now go to a more sophisticated system, supposedly with the knowledge of how to utilizing the data, according to City Manager Morris Madrid, making it “more efficient.”
The city could not produce a cost-benefit analysis or an electric-utility management plan that demonstrates such equipment will deliver the claimed efficiencies.
The Sierra County Sun looked at a study the city purchased from an engineering firm in 2015, tasked with assessing electric department equipment. The firm was hired after the city’s 2014 comprehensive plan identified a 15-percent to 20-percent energy loss due to old transmission lines and transformers.
The study made no mention of smart meters. However, if the city had methodically completed the upgrades suggested in the study, the preparation would serve as a rationale for the upgrade to smart meters.
Asked if any of the upgrades had been done, City Commissioner George Szigeti said “yes,” but when asked for proof, Madrid and Szigeti said the Sierra County Sun would have to look through the last four years of Public Utility Advisory Board minutes. The Sun pointed out it would be guessing or surmising what might be the highly-technical upgrades referred to in the study and requested the city produce the documents. Madrid insisted it was the Sun’s and the public’s “responsibility to inform themselves.”
If the city’s past practices are a guide, it is unlikely methodical upgrades have been done. The study made clear the engineering firm couldn’t start assessing equipment until it did an inventory of the city’s equipment, which had never been done. Little testing had been done of equipment, the study noted. The electric department still has not put an equipment-testing or asset-management plan in place since the 2015 study; no such document exists.
City Commissioner George Szigeti played an important part in the recent purchase of smart meters. He was on the Public Utility Advisory Board for years. He went off the board when he was appointed several months ago by the City Commission to take Commissioner Steve Green’s place, who subsequently resigned.
Szigeti was the only City Commissioner who answered the Sierra County Sun’s questions, perhaps answering for the board, which would explain why he copied his fellow commissioners in the email response, a violation of the Open Meetings Act.
In his email, Szigeti said the PUAB recommended the City Commission sign a $9-million “performance contract” with YESCO to replace all water and electric meters, taking 25 years to pay it off through supposed efficiency savings. The City Commission declined the purchase in 2018 as too expensive, he said.
“This led us to the current contract,” Szigeti said. “As you can see, $1 million is substantially less than the original $9 million proposal, even if it does not include the water meters. It was decided to let the Electric Department pay for the electric meters and AMI backbone, because the department has the budget to support this expense. The water meters can be added to the system a few at a time as money becomes available.”
Therefore Szigeti relates the current purchase to the preceding four years of discussion with YESCO, even though a different vendor is in play. The vast difference in cost, between $9 million and $1 million for about half the smart meters demonstrates it is critical for the city not to rely on a vendor’s cost analysis or price quote or promise of efficiency savings. Yet that is what the City Commission has done, with city customers paying for the $1-million purchase.