Vero electric study: ‘To save, trim trees’
It’s no huge surprise that Vero electric’s hired consultants recommend the city trim trees more aggressively and move to an automated metering system to save money – Florida Power and Light already does these things to help keep rates low – but it was shocking to see that the highly touted “optimization” study only found $108,000 in potential cuts in a $94 million operating budget.
That might mean about a 10-cent savings on the average electric bill.
City officials had held this study out as promising in terms of opportunities for reducing electric rates, but with recommended efficiencies like more aggressive tree trimming and a smart-metering system not being without their own implementation costs, the small amount of anticipated savings, at least in the short-term, seems like a wash.
The study, which consultants Power Resources finished and gave to Vero on Sept. 2, but which Councilwoman Pilar Turner had to specifically ask for to get a copy of on Sept. 14, compared Vero’s electric Transmission and Distribution (T&D) system to other government-owned utilities in terms of staffing, operations and efficiency.
A similar study of Vero’s water and sewer utility had produced significant savings, so Vero officials were hopeful.
“It’s a tremendous disappointment and a complete waste of money,” Turner said about the study. “They came with these huge expectations, that they were going to get something similar to the water and wastewater system and I thought, electric is not the wastewater system.
The study does not provide much new information to anyone who has paid attention to the Vero electric saga. It is not the “silver bullet” of prescribed money savers it was held out to be. If anything, the study says Vero needs to pump more money into its electric system, not less.
“Reliability results show negative trending and annual audits are unfavorable when compared to similarly-sized cities,” the study says, explaining that the lack of resources dedicated to maintenance, plus employee uncertainty over the floundering sale of the system, has not been good for business.
No surprise, the system is aging and its vulnerabilities are showing. “The city is experiencing nearly double the amount of underground cable failures and underground related outages each year since 2012,” the study said about the barrier island distribution system, which is buried underground. “Many failures are due to old and deteriorated cables.”
Consultants say Vero has put off needed maintenance of the system, and steady investment is needed over the next few years to get everything back up to par.
City officials didn’t need a report certified with the seal of a professional engineer to tell them that. The consultants also recommend the city use contractors, and that, “in the event of resource constraints, the city should first evaluate vacancies, employee skill sets, and cross section of entry-level to senior positions before adding permanent staff.”
These suggestions seem like Management 101, and though the wisdom of those who run the city and Vero electric in particular has routinely come under scrutiny, City Manager Jim O’Connor and his senior staff probably didn’t need consultants to tell them how and when to fill or add utility positions.
The tree-trimming recommendation attacks one of the tenets Vero electric holds dear, that it doesn’t hack away at residents’ trees like it claims FPL does. Vero has a policy of cutting trees five feet from power lines.
“City records indicate that the majority of overhead outages are tree-related.” The study notes that the city’s “minimal clearing practices around primary lines are contributing to the high outage rate. It is recommended that the city increase vegetation clearances around primary lines to reduce outages. Increasing the routine trimming distance will greatly improve reliability and significantly reduce the hazard exposure for electrical contact incidents through touch potential.”
They could have just said cut the trees shorter and they won’t mess with the power lines as much. Presumably it takes an engineering degree to write such an obtuse paragraph – a consultant’s equivalent to a kid padding his book report.
The optimization study was originally expected to be ready in March. Power Resources was also contracted to perform a rate study at a cost of $46,000 and preliminary results of that have only told the City Council that it needs to restructure the way Vero labels its charges to more accurately reflect what customers are paying for. After those costs are re-labeled, however, the total at the bottom of the bill will be the same.
Turner said she doesn’t know how much it cost the city to get this useless feedback, because the optimization portion of the project is only one of three phases, the last of which won’t be completed until November and formally presented to the City Council in December.
“I’m frustrated with the lack of transparency. If I hadn’t asked for this, we probably wouldn’t have gotten it,” Turner said.
Vero’s last big hope of reducing rates is a re-do of its 2008 bulk power deal with Orlando Utilities Commission. The first two drafts of that contract are rife with major concerns and restrictive covenants that would keep Vero Beach at war with its customers in Indian River County and the Town of Indian River Shores, via the courts and the Florida Public Service Commission, for the foreseeable future.
Should a more final draft of the OUC deal be ready for prime time this week, City Manager Jim O’Connor told the council that it could come before them for a vote on Oct. 6.