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Home My WebLink About2002-01-24-UTIL-rpt.pdf Electric Utility Ad-hoc Committee Background information (prepared by Patrick Mehr - 1/24/02) 1 Reliability Lexington appears to experience many outages - in specific parts of town (in Woodhaven, I experienced 5 outages for a total of 48 hours and 8 minutes over the 6 months period 3/5/01- 9/4/01, or an uptime of only 98 9%; Diehl Road, etc) , and - across town following a meeting between Nstar and Town officials in September 2001 (see pages 5-6) , Nstar provided some data ("M3I") based on which Lexington appears to have the largest number of outages among 13 towns with 10, 000 or more customers served by Nstar in its "North" territory (see page 7) - anecdotal information indicates Lexington has more outages than Concord or Belmont The Department of Telecommunications and Energy (DTE) has defined performance measures (CAIDI, CAIFI, SAIDI, SAIFI) utilities must provide to DTE pursuant to Appendix 1 to DTE ' s Service Quality Order (99-84) dated 6/29/2001 according to which Nstar must track reliability at the level of individual circuits We may want to invite Nstar to review with us - detailed outage history data for each individual circuit in Lexington - preventive maintenance (e g infrared surveys, tree trimming) and upgrading efforts (e g replacement of older transformers, of lower voltage circuits) undertaken and planned - future tracking of reliability data will the situation improve? Q 2 Rates Nstar' s rates in Lexington are substantially higher than the rates charged for similar consumption patterns in Concord by the local municipal distribution company, Concord Municipal Light Plant (CMLP) This is true both for - residential customers (see page 8) - commercial and industrial accounts (see pages 9-10) The Massachusetts Municipal Wholesale Electric Company (MMWEC www mmwec org) reports similar rate differences between municipal utilities (generally lower rates) and investor-owned utilities (e g Nstar/Boton Edison, Mass Electric) in its ongoing rate comparison for residential (see page 11) and commercial/industrial (see page 12) customers We may want to - analyze the cost structure of CMLP' s operations and compare it with Nstar ' s - explore municipalization in Lexington 3 Municipalization Lexington' s Town Meeting voted (by 178 to 2) in 1996 (article 37 see page 13) and (unanimously) in 1997 (article 42 see pages 14-15) to authorize the Town to establish a "municipal lighting and gas plant" in accordance with MGL Chapter 164 Sections 34 and 36 (attached minutes regarding these votes) Municipalization means the establishment of a town-owned operation responsible for purchasing bulk electricity and for distributing it in Lexington, to residences, institutional customers and businesses Concord and Belmont have a local municipal light plant since 1898 There are currently 40 municipal light plants in Massachusetts MGL Chapter 164 outlines the process to be followed by a town to municipalize its electric (and/or gas) distribution The two votes taken in 1996 and 1997 constitute the initial step in that process No town in Massachusetts has municipalized its electric distribution since the 1920s this appears to be because nothing in MGL Chapter 164 prevents the incumbent utility from refusing to sell its assets to the town Changes in State law may be necessary to prevent such a problem O Our Town Assessor indicates that the assessed value (at replacement cost) of Nstar' s assets in Lexington is $31 4 million in FY 2001 (see page 16) This figure is consistent with 2 separate estimates ($26 million and $36 million) which can be developed based on overall metrics of Nstar' s business (see page 17) Anecdotal information indicates that municipal light plants provide better reliability than Nstar because of - greater investments made in the distribution network to increase its reliability, - local crews dedicated strictly to one town know the network better and respond more promptly to outages, and - focus on service to the community and accountability to Town Meeting We may want to - research the operations, performance and cost structures of the Concord and Belmont municipal light plants - outline what a Lexington municipal light plant might look like (revenues, staffing, equipment, buildings) - commission a professional study to evaluate the economic attractiveness of municipalization, including projected rates for end- users, financing needs, required network investments (sub stations, metering points, etc) and all other relevant issues Initial conversations with RW Beck (which has conducted several such studies, including for Waterford CT of which I have a copy see page 18) indicate that such a study would cost about $100K (see page 19) 4 Aggregation It appears that Lexington already has the ability to "aggregate" purchases of bulk electricity on behalf of residents and businesses who would want to participate in the program The distribution of the kWhs would continue to be performed, as today, by Nstar In particular, schools can participate in the Massachusetts Health & Education Facilities Authority (Mass HEFA www mhefa state ma us and www powerDptions com) We may want to - explore aggregation for all town buildings, including schools - explore aggregation for residents and businesses in Lexington 0 5 Double poles MGL Chapter 164 Section 34B requires that "A distribution company or a telephone company engaging in the removal of an existing pole and the installation of a new pole in place thereof shall complete the transfer of wires, all repairs, and the removal of the existing pole from the site within 90 days from the date of installation of the new pole" In short, a "double pole" must be returned to a normal single pole situation within 90 days Nstar and Verizon are in broad violation of this requirement across their service territory For example, Newton' s Public Facilities Committee held a hearing on June 6, 2001 at which Nstar and Verizon recognized the problem (see page 20) Newton sent a letter to Nstar and Verizon outlining possible remedies if the utilities do not comply with MGL Chapter 166 Section 34B (see pages 21-22) A survey I conducted in Lexington in August 2001 indicates we have about 238 double poles across town A specific list of 154 double poles is available (see pages 23-24) Examples of "double poles" can be seen at http //users rcn com/girondel/lexingtonundergrounding/poles htm#8 Verizon has conducted its own survey and has determined there are about 210 double poles in Lexington, the majority of which resulting from Nstar not transferring its electrical equipment from the old pole to the new one Bill Hadley and David Carbonneau (DPW) have been in contact with Verizon on this matter We may want to invite Verizon and Nstar to present their plans and schedules for getting into compliance with MGL Chapter 166 Section 34B regarding double poles Other information Brookline has established a committee to investigate the feasibility of municipalization Contact is Sean Cronin, Assistant Town Administrator 617-730-2206 In Arlington, an article similar to what Lexington voted in 1996 and 1997 will be presented at the 2002 Town Meeting (see pages 25-27) Contact is Paul Schlictman, Town Meeting Member and School Committee Member 781-641-3401 www arlingtonelectrir org The charge for the Electric Utility Ad-hoc Committee, as adopted by the Selectmen on 12/17/01 is on page 28 The list of members of the Committee is on page 29 0