Thursday, January 14, 2010
The regular meeting of the Board of Directors of the Omaha Public Power District was held in the Board Room on the Atrium Level of Energy Plaza East, on January 14, 2010, at 10:00 a.m.
Present were Directors M. J. Cavanaugh, J. K. Green, G. C. Hall, A. L. McGuire, J. R. Thompson, F. J. Ulrich and D. D. Weber. Director Dodge was absent. Also present were W. G. Gates, President; M. C. Bodammer, Corporate Secretary; and S. M. Bruckner and T. F. Meyerson, General Counsel for the District. Mr. Ulrich, Board Chair, presided, and Mrs. Bodammer, Corporate Secretary, recorded the minutes. Other members of Management present were D. J. Bannister, T. J. Burke, E. E. Easterlin, A. J. Minks, D. F. Widoe, G. R. Williams, J. J. Hanson, M. R. Jones, L. L. Kapustka, M. W. Nichols, M. I. Doghman and D. K. Petrus. Others present included C. E. Perkins from I.B.E.W. Local #763; M. A. Patach from I.B.E.W. Local # 31; D. F. Begley and M. A. Salerno from I.B.E.W. Local #1483; Mark Welsch; and approximately 13 additional customer-owners and employees of the District. Additionally, there were seven representatives in attendance from Petersburg, Nebraska representing Petersburg and Boone County whose names are listed in the proceedings of Resolution No. 5811.
The Corporate Secretary read the following:
“Notice of the time and place of this meeting was publicized by notifying the area news media; by publicizing same in the Omaha World-Herald and Outlets; by displaying such notice on the Arcade Level of Energy Plaza since January 8, 2010; and by mailing such notice to each of the District’s Directors on that same date.
“A copy of the proposed agenda for this meeting has been maintained, on a current basis, and is readily available for public inspection in the office of the District’s Corporate Secretary.
“Additionally, a copy of the Open Meetings Law is available for inspection in the public meeting book located in this meeting room.”
It was moved and seconded that the Board reviewed the November 2009 Comprehensive Financial and Operating Report and that the minutes for the last meeting be approved. The vote was recorded as follows: Hall – Yes; McGuire – Yes; Thompson – Yes; Weber – Yes; Cavanaugh – Yes; Dodge – Absent; Green – Absent; and Ulrich - Yes. The motion carried.
Thereafter, the Corporate Secretary read the following:
“Persons wishing to address the Board on a particular item are asked to approach the microphone as that agenda item is discussed. Comments will be heard following Board discussion of the item and prior to a vote by the Board.”
The following resolutions were then read, and upon motion duly seconded, were placed on roll call. The vote on each resolution is indicated following the description of that resolution.
RESOLUTION NO. 5809 approves the Engineer’s Certification and authorizes Management to negotiate and award the necessary contracts for new main feedwater pumps for the Fort Calhoun Station. In the absence of Director Green, Director Hall led the discussion stating the equipment is necessary to ensure continued safe, reliable operation of the nuclear plant at power uprate conditions that will be in effect following the fall 2012 refueling outage. Note: Director Green entered the meeting at 10:05 a.m. during Director Hall’s discussion and had nothing additional to convey to the Board on the issue. Chairman Ulrich affirmed the final contract award will be reported back to the Board at a later date. Thereafter, the vote was recorded as follows: Hall – Yes; McGuire – Yes; Thompson – Yes; Weber – Yes; Cavanaugh – Yes; Dodge – Absent; Green – Yes; and Ulrich - Yes. The motion carried.
RESOLUTION NO. 5810 authorizes and directs Management to take all actions deemed necessary to address the Southwest Power Pool’s (SPP) proposed socialized transmission rate design and OPPD’s membership status in SPP. Director Thompson led the discussion and stated that, subsequent to the District joining SPP in April of 2009, a number of changes are now being considered by the SPP Board of Directors which could have economic impact on OPPD. In particular, the SPP Board has endorsed a socialized rate design for new transmission facilities in the SPP region which, if approved by the Federal Energy Regulatory Commission (FERC) and implemented by SPP, will have significant cost impacts on OPPD’s customer-owners with no benefits. Director Thompson recommended that the Board direct Management to monitor the situation over the next few months and authorize them to take appropriate actions deemed necessary to address the SPP’s proposed socialized transmission rate design and, if necessary, change its membership status with SPP to a nontransmission-owner. This change in membership status would also require OPPD to reactivate and administer its own Open Access Transmission Tariff or else contract with a service provider to handle. Director Green inquired about the time table of events leading to the ultimate decision to either maintain OPPD’s current membership status or change its membership status. Vice President Widoe indicated the SPP Board will be meeting on January 26 and committee meetings will also be taking place at that time. OPPD representatives will be in attendance. He said OPPD’s Senior Management team will then meet to discuss and evaluate the outcomes of that meeting as well as discussions between the District’s General Counsel and SPP’s legal counsel. The concern is that if the SPP Board adopts some of the reliability and priority project funding, OPPD would be obligated to pay for that funding under the terms of its current membership. Mr. Widoe indicated that if the funding mechanism remains the same, there would be no need to change OPPD’s membership status and OPPD would remain a transmission-owner member. Following the discussion, the vote was recorded as follows: Hall – Yes; McGuire – Yes; Thompson – Yes; Weber – Yes; Cavanaugh – Yes; Dodge – Absent; Green – Yes; and Ulrich - Yes. The motion carried.
RESOLUTION NO. 5811 authorizes Management to execute a long-term Purchase Power Agreement with TPW Petersburg LLC for 40.5 megawatts of wind-generated electricity. Director Hall acknowledged several people from Petersburg who were in attendance in support of this project. He reiterated OPPD’s goal to achieve 400 megawatts of renewable energy by the year 2020 and indicated this project will bring the District’s renewable energy generation capacity to 141.5 megawatts. Director Hall said the developer, TPW Petersburg LLC (TPW), is headquartered in San Ramon, California and is over 99 percent owned by Morgan Stanley. TPW currently oversees more than 20 wind generation projects across the country. Mr. Hall remarked this wind generation project is OPPD’s first Community-Based Energy Development (C-BED) project which means that one-third of the revenue payments from the wind farm will go to qualified Nebraska residents who have invested in the project. He said the Power Purchase Agreement is for 20 years and as part of the agreement OPPD will have the option to purchase the wind farm after the 20-year period. Chairman Ulrich introduced the following attendees from TPW Petersburg LLC, the wind farm developer: Peter Mastic, CEO - Third Planet Windpower; Jim Kutey, Vice President – Southern Region, Third Planet Windpower; and Walter Kamp, Vice President – Development, Engineering and Technology, Third Planet Windpower. Chairman Ulrich also introduced the following representatives from the Petersburg community: Hank Thieman, Boone County Commissioner; Ross Knott, President – Petersburg State Bank and member of the local economic development group; Shannon Landauer, Boone County Economic Development Director; and Larry Temme, a local grocer and another member of the local economic development group. Thereafter, Mr. Knott, Mr. Thieman, Ms. Landauer and Mr. Mastic each addressed the Board to acknowledge the strong support the Petersburg community has for this project. Mr. Mastic, CEO of Third Planet Windpower, closed by thanking the Board for the opportunity to partner with OPPD and deliver clean renewable energy to OPPD’s ratepayers. Following the discussion, the vote was recorded as follows: Hall – Yes; McGuire – Yes; Thompson – Yes; Weber – Yes; Cavanaugh – Yes; Dodge – Absent; Green – Yes; and Ulrich - Yes. The motion carried.
RESOLUTION NO. 5812 approves the pledged securities and surety bond covering the District’s account balances held at financial institutions. Following the discussion, the vote was recorded as follows: Hall – Yes; McGuire – Yes; Thompson – Yes; Weber – Yes; Cavanaugh – Yes; Dodge – Absent; Green – Yes; and Ulrich - Yes. The motion carried.
RESOLUTION NO. 5813 approves the appointment of a Corporate Officer. Director Weber led the discussion confirming the Governance Committee’s recommendation that Mohamad I. Doghman be appointed to the position of Vice President, Transmission & Distribution Engineering and Operations and Assistant Secretary of the District, effective February 1, 2010. He discussed Mr. Doghman’s work history since joining the District in 1989 and stated his educational background and other professional qualifications. Chairman Ulrich then invited Mr. Doghman to introduce his wife, Mary Doghman, who was in the audience. Following the discussion, the vote was recorded as follows: Hall – Yes; McGuire – Yes; Thompson – Yes; Weber – Yes; Cavanaugh – Yes; Dodge – Absent; Green – Yes; and Ulrich - Yes. The motion carried.
Copies of the foregoing resolutions are filed in the District’s Corporate Records file.
The next order of business was election of Board Officers. Chairman Ulrich explained the nomination protocol and proposed a roll call vote be used. The Board agreed on this procedure.
CHAIRMAN OF THE BOARD
Director McGuire nominated Director Green for the office of Chairman of the Board. As there were no other nominations, nominations were closed and the vote was recorded as follows: Hall – Yes; McGuire – Yes; Thompson – Yes; Weber – Yes; Cavanaugh – Yes; Dodge – Absent; Green – Yes; and Ulrich - Yes. The motion carried. Director Green was elected Chairman of the Board.
VICE CHAIRMAN OF THE BOARD
Director Ulrich nominated Director Dodge for the office of Vice Chairman of the Board. As there were no other nominations, nominations were closed and the vote was recorded as follows: Hall – Yes; McGuire – Yes; Thompson – Yes; Weber – Yes; Cavanaugh – Yes; Dodge – Absent; Green – Yes; and Ulrich - Yes. The motion carried. Director Dodge was elected Vice Chairman of the Board.
TREASURER OF THE BOARD
Director Cavanaugh nominated Director Thompson for the office of Treasurer of the Board. As there were no other nominations, nominations were closed and the vote was recorded as follows: Hall – Yes; McGuire – Yes; Thompson – Yes; Weber – Yes; Cavanaugh – Yes; Dodge – Absent; Green – Yes; and Ulrich - Yes. The motion carried. Director Thompson was elected Treasurer of the Board.
SECRETARY OF THE BOARD
Director Thompson nominated Director Cavanaugh for the office of Secretary of the Board. As there were no other nominations, nominations were closed and the vote was recorded as follows: Hall – Yes; McGuire – Yes; Thompson – Yes; Weber – Yes; Cavanaugh – Yes; Dodge – Absent; Green – Yes; and Ulrich - Yes. The motion carried. Director Cavanaugh was elected Secretary of the Board.
The next order of business was the opportunity for comment on other items of District business. At this point, Director Green, as the newly appointed Chairman, presented a recognition plaque to Director Ulrich as a token of the Board’s appreciation for a job well done during his two-year tenure (2008-2009) as Chairman of the OPPD Board of Directors. He commented that under Director Ulrich’s leadership, the senior management team was strengthened with the hiring of two new vice presidents. Additionally, OPPD received the ninth consecutive J.D. Power and Associates Award for Customer Satisfaction. During the summer of 2008, Director Ulrich led efforts in restoring the District following the worst storm in the District’s history in terms of damage. Nebraska City Station Unit 2, the first base load plant built by OPPD within the last 30 years, was dedicated in 2009. He noted the plant was designed and built at considerable savings to the District’s customer-owners. Director Green continued by stating Director Ulrich has been a leader in increasing the District’s alternative energy resources portfolio. His efforts began with the creation of a new Sustainable Energy and Environmental Stewardship Division, followed by the announcement of a new renewable energy goal of 10 percent by the year 2020. Additional achievements in environmental sustainability efforts included Board authorization to enter into several long-term contracts for wind-generated electricity and Board approval for the testing of hybrid plug-ins. During his chairmanship, Director Ulrich also presented the first President’s Award, a prestigious award created to recognize employees who have gone beyond the call of duty to perform extraordinary service. On behalf of the entire Board, Chairman Green extended their combined appreciation for elevating the standard of electric generation and public power in the state. President Gates expressed his appreciation for Director Ulrich’s leadership and advice in leading the company forward. Director Thompson shared his appreciation for his efforts in working with rural customers during the construction of the Nebraska City Station Unit 2 transmission line project. Director McGuire commended him for promoting collaboration and teamwork. Director Hall echoed Ms. McGuire’s comments stating that during Director Ulrich’s tenure the Board was well educated on all issues and worked effectively together in making some difficult decisions. Director Ulrich closed by extending his appreciation to the Board, the Management team and the employees of the District.
There being no further business, the meeting adjourned at 10:43 a.m.
A. J. Minks M. C. Bodammer
Assistant Secretary Corporate Secretary