January / February 2009 - Nebraska Public Power District

6 ENERGY INSIGHT • jaNuaRY / fEbRuaRY 2009
ENERGY INSIGHT • jaNuaRY / fEbRuaRY 2009 7
Chartered Territory
...understanding the issues in LB53
Sen. Deb Fischer introduced Legislative Bill 53 in the Natural Resources Committee on Jan. 22. The
bill would change state statutes relating to the chartered territory of public power districts. Passage
of the bill would amend state statutes to align NPPD’s chartered territory more closely with its
wholesale and retail service territory, thus affecting areas of the state where citizens currently vote
and run for NPPD’s Board of Directors. The following Q&A with Vice President and General Counsel
John McClure delves deeper into why NPPD supports this bill.
In regard to chartered territory, can
you explain the current state statutes?
From the original establishment of public power
districts in 1933 until 1986, there was one set of
statutes governing chartered territory. In 1986, a
statutory change established two separate sets of
requirements. One set of requirements governs public
power districts operating in 50 counties or fewer, and
the other one governs public power districts operating
in more than 50 counties. NPPD is the only public
power district in the state that operates in more than
50 counties
Why does NPPD
want to see a change
in the state statutes?
LB 53 would eliminate
the “more than 50 counties”
requirements, thus returning
the statutes to one set of
requirements for all public
power districts. It also
adds a provision to require
municipalities and other
wholesale customers to
purchase 50 percent or more
of their firm wholesale annual
energy from a public power
district to be included in the
chartered territory of the
supplying district.
What is NPPD’s current chartered
territory?
NPPD’s current chartered territory is the entire state
except for Douglas and Sarpy counties and five first
class cities which are not electrically interconnected
with NPPD—Alliance, Blair, Fremont, Nebraska
City and Sidney. These exclusions are the only ones
permitted by current law. All other areas of the state
must be included, even if NPPD does not serve
those areas directly at retail or indirectly through a
wholesale customer.
DIRECTOR SUBDIVISIONS OF THE AREA AND TERRITORY OF THE
NEBRASKA PUBLIC POWER DISTRICT
How would amending the state statutes
affect NPPD’s Board of Directors?
Currently, NPPD’s chartered territory includes some
areas where the citizens do not receive their electricity
either directly or indirectly from NPPD; however, the
people in these areas still have the authority to vote
and run for NPPD’s Board of Directors. NPPD is
governed today by an 11-member, popularly elected
Board of Directors. Each Director is elected from one
of 11 subdivisions of the chartered territory which
include one or more counties. The population of those
subdivisions—based on the U.S. Census which is
conducted every 10 years—must be approximately the
same.
The issue before us is that customers who rely
exclusively on NPPD for power supply are at risk
of seeing their voices diluted by citizens who have
limited or no direct financial stake in the outcome
of NPPD’s actions. After the 2010 U.S. Census is
released, areas that have limited or no long-term
power supply contracts with NPPD—such as Lincoln,
Grand Island and Hastings—could have an increased
voice in NPPD governance simply because of the shift
in population to larger communities.
As drafted, LB53 would result in the elimination of
the chartered territory where three directors currently
reside (two directors in Lincoln and one in Broken
Bow), thus eliminating their positions on NPPD’s
Board.
Now that the bill has been introduced
and advanced by the Natural Resources
Committee, what happens next?
The bill went to General File, which is the first
time the full Legislature has the opportunity to
debate and vote on bills. On Monday, Feb. 9, LB 53
was advanced from General File to Select File by a
vote of 36-2. Select File is the second debating and
voting stage. This step allows another opportunity
for amendment. Bills on Select File may be killed
or advanced to the next stage, Final Reading. The
Nebraska Constitution requires that before final
passage, all bills must be read aloud in their entirety
by the Clerk of the Legislature, unless three-fifths (30
members) of the Legislature vote not to do so. After
the bill is passed on Final Reading, the Governor has
five days to decide to either approve or veto the bill.
The Legislature can override the bill, but it takes the
vote of 30 senators.
RESOLuTION
Of NEbRaSKa PubLIC POWER DISTRICT
No. 08-151
adopted: December 12, 2008
WHEREAS, it is the mission of Nebraska Public Power District (NPPD) to safely
generate and deliver low-cost, reliable energy and provide outstanding customer
service; and
WHEREAS, NPPD generally supports legislation that sustains Nebraska’s public
power system and protects the interests of electric consumers in Nebraska, and
WHEREAS, NPPD generally opposes legislation and regulation that impose broadbased
mandates that do not account for local conditions, experience, evidence, and
performance.
NOW, THEREFORE, BE IT RESOLVED with reference to the 2009 sessions of the
Nebraska Legislature and the 111th U.S. Congress and related regulatory actions,
that the District:
1.
Opposes legislation which would jeopardize public power.
2. Supports water-related legislation and regulation designed to protect both
groundwater and surface water needs of the District, and will consider the
surface water and groundwater needs of its customers as it formulates
positions.
3. Supports legislation which provides increased funding for Renewable Energy
Production Incentives (REPI), or for other state and federal incentives
comparable to those afforded investor-owned utilities and other private entities
for renewable energy projects.
4. Opposes legislation mandating a renewable portfolio standard without
guaranteed adequate incentives to carry out the mandate in a cost-effective
manner.
5. Opposes the sale of federally-owned and operated generation and
transmission facilities.
6. Supports continued sale of Western Area Power Administration power at costof-service
prices.
7. Supports federal legislative and regulatory actions which advance the
development of a high-level nuclear waste management/disposal facility.
8. Supports economy-wide solutions to address greenhouse gases based on
proven science, which for the electric industry, focuses on early commercially
viable technology development, expansion of energy efficiency and renewable
technologies, and a diverse generating mix to reduce CO2 emissions.
9. Opposes expanding the applicability of taxes/fees on public power districts.
10. Supports state environmental legislation and regulation that is equivalent to
federal requirements unless it can be demonstrated that federal regulations do
not adequately protect public health and the environment.
11. Supports a modification of the public power district procurement statutes to
increase the sealed bid threshold from $100,000 to $500,000 for public power
districts with annual revenues in excess of $500,000,000.
12. Supports legislation which reduces statutory barriers to receive Power Review
Board approval for renewable energy projects.
13. Supports legislation which requires that wholesale customers of a public power
district receive at least 50 percent of their annual power and energy under a
firm power contract in order to be included within the chartered territory of the
supplying district.
14. Supports legislation allowing officer salaries to be approved by the board with
a majority vote.
* An original motion was made to approve the 2009 Legislative Policy Resolution, to
include Item Nos. 1-12, and Item No. 14; this motion carried by a vote of 11-0.
A second motion was made for the approval of the 2009 Legislative Policy
Resolution, Item No. 13, which passed by a vote of 8-3, and 1 abstention.