Aug 27, 2025 City Council

LET'S CALL THE

[1. CALL TO ORDER/PLEDGE OF ALLEGIANCE/MOMENT OF SILENCE]

MEETING TO ORDER.

JOIN ME FOR THE PLEDGE OF ALLEGIANCE.

I PLEDGE ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA AND TO THE REPUBLIC OVER WHICH STANDS, ONE NATION UNDER GOD, INDIVISIBLE, WITH LIBERTY AND JUSTICE FORUM.

OKAY, NOW A MOMENT OF SILENCE.

CLERK, WOULD YOU PLEASE READ THE ROLL CALL? MAYOR JALO.

THANK YOU VERY MUCH.

MADAM

[2. ROLL CALL]

HERE, VICE MAYOR PLU.

COUNSELOR FURMAN EXCUSED.

[3.a. AB 3249 Discussion/possible direction regarding a proposed IGA with NAU to conduct an RFP to procure clean energy options through an offside energy project to meet municipal and community sustainability goals.]

BUSINESS.

A AB 32 49.

DISCUSSION, POSSIBLE DIRECTION REGARDING THE A PROPOSAL IGA WITH NAU TO CONDUCT AN RFP TO PRE PROCURE CLEAN ENERGY OPTIONS THROUGH AN OFFSHORE ENERGY PROJECT TO MEET MUNICIPAL AND COMMUNITY SUSTAINABLE GOALS.

AND BRYCE, YOU'RE UP ALL GOOD.

AFTERNOON, MAYOR, VICE MAYOR IN S COUNCIL.

I'M EXTREMELY EXCITED TO BE HERE, UH, TODAY TO DISCUSS A LITTLE BIT MORE ON, UH, ENERGY AND, UH, VIRTUAL POWER PURCHASE AGREEMENTS AS A POTENTIAL OPTION, UH, FOR, UH, MUNICIPAL AND COMMUNITY CLEAN ENERGY GOALS.

SO, AS A WHOLE, UH, OUR AGENDA, UH, FOR TODAY IS JUST, UH, I WANT TO COVER A LITTLE BIT OF, JUST AT A HIGH LEVEL WHAT OUR REGIONAL ENERGY GRID, UH, IS LIKE, UH, COVER A LITTLE BIT OF OUR CI UH, PREVIOUS CITY ENERGY, UH, RELATED PROJECTS.

UH, DISCUSS A BIT ON THE OVERVIEW OF HOW POWER VIRTUAL POWER PURCHASE AGREEMENTS WORKS, OR, UH, FOR THE ACRONYM, UH, VPA, UH, SOME OF THE BENEFITS AND CHALLENGES TO THOSE, UH, AS WELL AS COVERING A LITTLE BIT OF UPCOMING, UH, OPPORTUNITY WITH NORTHERN ARIZONA UNIVERSITY FOR AN INTERGOVERNMENTAL AGREEMENT TO KIND OF PURSUE THESE OPTIONS FURTHER AS A PART OF A CONSORTIUM, UH, A COLLABORATION ACROSS, UH, MUNICIPALITIES AND UNIVERSITIES ACROSS THE STATE.

SO, AS A, A WHOLE, OUR CURRENT STATUS FOR THIS RESPECTIVE PROJECT AND VIRTUAL POWER PURCHASE AGREEMENTS, THERE IS NO DIRECT PROJECT UP FOR REVIEW.

UH, UH, THE IGA, THE FINALIZED IGA WOULD AS ANTICIPATED COME TO YOU IN LATE, UH, LATE SEPTEMBER OR EARLY OCTOBER.

UH, WHAT WE WANTED TO DO FOR THIS SESSION IS JUST TO, UH, GET MORE AWARENESS ON HOW VIRTUAL POWER PURCHASE AGREEMENTS WORK.

UH, PROVIDE A LITTLE BIT ADDITIONAL CLARITY ON THE KIND OF INNER WORKINGS OF THEM.

UH, AND ALSO JUST WE, WE REALLY WANT YOUR FEEDBACK ON, UH, ADDITIONAL QUESTIONS AND THE LIKE THAT I CAN TAKE TO, UH, NA U'S TEAM, AS WELL AS THEIR CONSULTANTS USE SOURCE SO THAT, UH, BY THE TIME AN EVENTUAL, UH, POTENTIAL, THE FINALIZED AGREEMENT CAN COME BEFORE YOU, THAT I CAN TRY TO ANSWER SOME OF THOSE QUESTIONS A LITTLE BIT MORE THOROUGHLY.

UH, THEN I MAY BE ABLE TO DO MYSELF, UH, IN THE, THE MEETING TODAY.

UH, AND THEN, UH, JUST AS A, KIND OF LIKE A PRECURSOR FOR A, A FUTURE, UH, MEETING, IS THAT WE'RE GONNA TAKE A DEEPER DIVE ON EMISSIONS INVENTORIES HERE, UH, BY THE END OF THE YEAR.

SO WE'RE WRAPPING UP SOME OF THE, THOSE NUMBERS, AND THEN WE'LL BE COMING BACK TO YOU, UH, DISCUSS THAT AS WELL.

SO THAT IS, UH, THAT IS ON OUR AGENDA, UH, TO BE BACK BEFORE YOU.

ALL RIGHT.

SO HIGH LEVEL, UH, COMPONENT WITH THE, THE US ENERGY GRID.

UH, IT'S KIND OF BROKEN UP INTO THESE THREE SECTIONS.

UH, THIS MAP ON THE LEFT, UH, ARE THOSE THREE SECTIONS.

UH, THEY'RE KIND OF KNOWN AS THESE INTERCONNECT AREAS.

THE YELLOW AREA IS WHAT WE'RE ATTACHED TO THAT IS KNOWN AS THE WESTERN INTERCONNECT.

UH, THE BLUE, OOPS, WENT TOO FAR.

THIS BLUE AREA IS KNOWN AS THE EASTERN INTERCONNECT, AND THEY GOT TEXAS DOING THEIR OWN LITTLE THING DOWN THERE, UH, IN THE ERCOT, UH, SECTION.

THE COOL THING ABOUT THE ENERGY GRID, UH, IS THAT WHEN THERE ARE, UH, DIFFERENT OUTAGES OR POWER DEMANDS ACROSS THE ENERGY GRID, UH, YOU CAN THEORETICALLY THEN SEND POWER FROM ONE SECTION OF THE GRID TO ANOTHER TO SUPPLY, UH, TO SUPPLY THAT ENERGY.

SO IF THERE IS A SPIKE, UH, DUE TO A HEAT WAVE AND SOMEBODY HAS EXTRA ENERGY, THEY CAN SEND IT, UH, TO ARIZONA AND VICE VERSA, AND KIND OF BALANCE THE GRID ACROSS THE, UH, ACROSS THE SCALE.

UH, FOR INSTANCE, WHEN CALIFORNIA, UM, DURING THE SUMMER TIMES AND THEY PRODUCE A SIGNIFICANT AMOUNT OF SOLAR, UH, THAT SOLAR HAS TO GO SOMEWHERE AND YOU HAVE TO BALANCE THE ELECTRONS, UH, THAT SOLAR CAN BE SOLD, UH, OR ACTUALLY, UH, THEY'LL SOMETIMES PAY A PS TO ACTUALLY TAKE THAT SOLAR OFF THEIR HANDS AND BE ABLE TO USE IT ON THE GRID.

BUT ESSENTIALLY, IT ALLOWS ALL THESE DIFFERENT PLAYERS TO, UH, CONNECT TO EACH OTHER AND BE ABLE TO, UH, BALANCE ENERGY MIXES, PROVIDE DIFFERENT RESOURCE COMPONENTS WITHIN, IT COULD BE SOLAR, WIND, GEOTHERMAL, AND THE LIKE.

UH, BUT IT'S, UH, KIND OF GOVERNED IN THESE, THESE KIND OF DISTINCT AREAS.

AND THEN, AS Y'ALL KNOW, UH,

[00:05:01]

FOR THE, UH, ARIZONA SECTION, WHICH IS A MAP ON THE RIGHT, I WAS TRYING TO FIND ONE THAT HAD BIGGER TEXTS, BUT, UH, THE ARIZONA CORPORATION COMMISSION WEBSITE ONLY HAD THIS REALLY SMALL TEXT TO IT.

UH, BUT, UH, ESSENTIALLY THIS, UH, MAP ON THE RIGHT IS, UH, THE REGULATED, UH, MARKETS THAT EACH ONE OF THESE SECTIONS HAS A DISTINCT ELECTRICAL OPERATOR IN THEM.

UH, THE THREE LARGEST FOR, UH, ARIZONA ARE ARIZONA, UH, PUBLIC SERVICE, ALSO KNOWN AS A PS.

UH, THIS AND THIS TEAL COLOR HERE IN THIS PURPLE COLOR, UH, THAT IS, UH, SALT RIVER PROJECT, ALSO KNOWN AS SRP.

AND THEN THIS, UH, RED COLOR DOWN HERE BY TUCSON.

THAT'S TUCSON ELECTRIC POWER.

THOSE ARE OUR THREE, UH, LARGEST ELECTRICAL ENTITIES, UH, IN HERE IN THE STATE, UH, THAT HAVE THE ARIZONA CORPORATION COMMISSION, UH, REGULATING, UH, THEIR ACTIVITIES.

AS A CITY, THOUGH, WE KINDA OPERATE, UH, WITHIN ENERGY IN A COUPLE OF DIFFERENT, UH, ROLES.

UH, OFTENTIMES YOU MIGHT HAVE A CITY OWNED OR A LEASED OWNED, UH, RELATED PROJECT.

UH, YOU MIGHT EVEN HAVE A, A POWER PURCHASE AGREEMENT.

MOST OF THE POWER PURCHASE AGREEMENTS THAT HAVE BEEN CONDUCTED TO DATE ARE KINDA LIKE A PHYSICAL POWER PURCHASE AGREEMENT OR SOMETHING ON SITE, UH, OR CONNECTED TO YOUR OWN METERS.

UH, OR ALSO ASPECT IS SEARCHING OUT FOR RENEWABLE ENERGY CREDITS, WHICH THE CITY HAS DONE.

AND THEN WHAT WE'LL TALK ABOUT, UH, HERE A LITTLE BIT MORE IS VIRTUAL POWER PURCHASE AGREEMENTS, UH, AS A WHOLE, AS A POTENTIAL, UH, NEW OPTION FOR US.

UH, AND THEN I JUST HAVE FUTURE INNOVATION OUT THERE.

'CAUSE A LOT OF THESE THINGS WE WEREN'T REALLY TALKING ABOUT 10 YEARS AGO, LIKE, SO AS WE GO ALONG, NEW THINGS COME TO MARKET THAT WE, UH, EVALUATE AND SEE WHAT WE CAN DO ON HOW THEY MIGHT BE ABLE TO INTERACT WITH US HERE IN THE CITY.

SO, TO COVER SOME OF THOSE, UH, PREVIOUS CITY ENERGY PROJECTS, UH, I WANNA HIGHLIGHT THE, UH, WASTEWATER, UH, SOLAR ARRAY.

UH, THAT WAS THE CITY'S, UH, FIRST POWER PURCHASE AGREEMENT, UH, THAT WAS DONE IN 2012.

UH, IT PURCHASE AGREED TO PURCHASE ALL OF THE ELECTRICITY THAT IS GENERATED AT THAT SOLAR ARRAY.

UH, THERE WAS NO UPFRONT CAPITAL COSTS ASSOCIATED WITH THAT.

THE COMPANY CAME IN, BUILT THE FACILITY, AND THEN THE CITY JUST AGREES TO BUY ALL OF THE ENERGY OFF OF IT FOR, I BELIEVE IT WAS A 20 YEAR TIMEFRAME.

UH, ALSO IN 2019, UH, THE CITY AGREED, UH, ENTERED AN AGREEMENT WITH A PS FOR THE SOLAR COMMUNITIES PROGRAM, WHICH BROUGHT ON THE SOLAR CAR PORTS THAT WE HAVE HERE AT CITY HALL.

UH, THAT PROJECT WAS ALSO A, A NO, UH, UPFRONT CO CAPITAL COST TO THE CITY.

UH, IT'S AN A PS OWNED ASSET.

UH, SO WE DON'T TECHNICALLY RECEIVE THAT, UH, SOLAR OFF OF IT.

UH, IT, THEY GET TO CLAIM IT AS, AS DISTINCTLY THEIR OWN.

UH, BUT WE RECEIVE A BILL CREDIT ASSOCIATED WITH THAT FOR THE DURATION OF THE AGREEMENT.

UH, AND THAT ONE, I BELIEVE IS ALSO A 20 YEAR AGREEMENT.

AND THEN IN LATE, UH, 2022, UH, THE CITY WAS THE SECOND CITY.

THE CITY OF ARIZONA WAS THE SECOND CITY, I BELIEVE, TO ENTER INTO THE, UH, ARIZONA PUBLIC SERVICES GREEN POWER PARTNERS PROGRAM.

THAT PROGRAM, UH, SOURCES ENERGY FROM EXISTING RENEWABLE A PS ASSETS.

UH, IT DIDN'T BRING ON, UH, BRAND NEW A PS ASSETS.

THEY WERE WIND FARMS AND SOLAR FARMS THAT WERE ALREADY IN EXISTENCE THAT THESE, UH, RENEWABLE ENERGY CREDITS WERE ATTACHED TO.

UH, AND IT APPLIES, UH, ESSENTIALLY A GREEN, UH, TARIFF OR A GREEN PREMIUM, UH, TO, UH, TO ALL OF A PS ELECTRICITY PROVIDED TO THE CITY, UM, IN ORDER TO RECEIVE THE RENEWABLE ENERGY CREDITS THAT WERE ASSOCIATED WITH THOSE ASSETS.

AND THEN MORE ON A COMMUNITY FACING SIDE OF THINGS.

UH, WE HAVE, UH, HOSTED, UH, RESIDENTIAL SOLAR CO-OPS, UH, WITH, UH, PARTNERS, THE CITY OF, UH, FLAGSTAFF, COCONINO COUNTY, AND SOLAR UNITED NEIGHBORS, UH, THOSE KIND OF CO-OPS ARE, ARE GEARED TO GATHERING RESIDENTS TOGETHER TO EXPLORE SOLAR.

UH, AND THEN AS A WHOLE, THEY, UH, WHEN THEY'RE ABLE TO BUILD THE NUMBERS BEHIND THEIR EFFORTS, THEY CAN REDUCE THE OVERALL COST OF THAT SOLAR GENERATION.

KIND OF A SIMILAR COMPONENT.

IT WOULD BE CONSIDERED HERE FOR A VIRTUAL POWER PURCHASE AGREEMENT.

US GOING AT IT ALONE IS RATHER DIFFICULT AND COULD BE, UH, COSTLY.

UH, OUR MUNICIPAL ENERGY LOAD IS, UH, TO THE POINT WHERE IT CAN BE, UM, SO MINOR THAT IT DOESN'T ENTICE LARGER ENERGY DEVELOPERS TO COME IN AND, AND WANT TO BUILD THE SITE.

BUT IF WE'RE ABLE TO PARTNER WITH OTHER MUNICIPALITIES AND UNIVERSITIES AND BE ABLE TO BUILD THAT DEMAND OUT, THEN WE CAN GET BETTER PRICING STRUCTURES AND INTEREST INTO BUILDING, UH, A RENEWABLE SITE FOR US.

SO, KIND OF A SOMEWHAT SIMILAR COMPONENT ON HOW RESIDENTIAL SOLAR COSTS WORK AND HOW A CONSORTIUM CAN WORK FOR A VIRTUAL POWER PURCHASE AGREEMENT.

AND I JUST WANNA COVER, UH, SOME REAL QUICK, UH, ESTIMATES, UH, OR AN AVERAGE ESTIMATES THAT WE SEE FROM, UH, THREE OF THOSE, UH, PROJECTS THAT I MENTIONED.

UH, THE WASTEWATER SOLAR PROJECT PRODUCES, UH, ROUGHLY A MILLION KILOWATT HOURS A YEAR.

UM, IT, WE AGREE TO PURCHASE ALL OF THAT ENERGY AT A LITTLE OVER SEVEN AND A HALF CENTS A KILOWATT HOUR, UH, IN AP APSS RATES IN JUNE OF 25 THAT WE HAD WAS A LITTLE OVER 12 CENTS A KILOWATT HOUR ON AVERAGE ANNUAL SAVINGS, ABOUT 40, $42,000.

[00:10:01]

THAT FLUCTUATES A BIT BECAUSE THE SOLAR SITE WILL, UH, OVERPRODUCE, UH, THE AGAINST THE METER IT HAS.

SO THEN SOME OF THAT SOLAR ENDS UP GETTING SOLD, UH, TO A PS, AND THEN WE USE DIFFERENT AMOUNTS OF THAT ENERGY AT DIFFERENT TIMES OF THE YEAR.

BUT AS A WHOLE, UH, YOU'LL, IT SAVES US, UH, SAVES US MONEY FOR IT.

THE A PS UH, SOLAR COMMUNITIES PROGRAM, IT'S A $375 BILL CREDIT, UH, THAT IS RECEIVED ON THAT MONTHLY, UH, OVER THE COURSE OF THE YEAR.

IT'S ABOUT A $4,500, UH, SAVINGS THAT'S ASSOCIATED WITH THAT SITE.

THE A PS GREEN POWER PARTNERS PROGRAM IS COST ADDITIVE, AS I MENTIONED.

IT'S A GREEN TARIFF THAT'S APPLIED, UH, ESSENTIALLY TO OUR ENERGY FOR IT.

UH, IT'S AT, UH, ABOUT A QUARTER OF A CENT, UH, KILOWATT HOUR ADDITION.

UH, OR IT'S $2 AND 50 CENTS A MEGAWATT HOUR.

IT COSTS US ABOUT $8,400, UH, A YEAR FOR THAT PROGRAM.

BRYCE? YEP.

THANK YOU, MAYOR BRYCE, DO YOU ANTICIPATE ANY CHANGE IN THAT COST FOR THAT PROGRAM? GIVEN MY UNDERSTANDING IS A PS IS CURRENTLY, UH, SEEKING A RATE INCREASE, AND I DON'T KNOW IF THAT APPLIES TO THAT PROGRAM OR NOT.

UH, AT THE MOMENT, WE HAVEN'T BEEN, UH, GIVEN ANY INCLINATION OF THE GREEN TARIFF INCREASING.

UH, BUT IT IS CERTAINLY A POSSIBILITY.

THIS BOTTOM LEG IS ESSENTIALLY WHAT WOULD BE THE NEW PIECE TO IT, THAT IT WOULD BE AN OFFSITE COMPONENT, THAT THAT ENERGY HAS TO GO SOMEWHERE.

EXCUSE ME.

ALRIGHT, SO WE'LL, UH, TALK A LITTLE BIT MORE ABOUT VIRTUAL POWER PURCHASE AGREEMENTS.

SO QUICKLY, I JUST KIND WANNA HIGHLIGHT SOME OF THE SIMILARITIES AND DIFFERENCES, UH, BETWEEN THE AGREEMENTS.

SO, ON THE LEFT IS A POWER PURCHASE AGREEMENT, ALSO KIND OF KNOWN AS A PHYSICAL ONE.

UH, AND THEN THE OPTION IS VIRTUAL, UH, FOR THE, THE ONE ON THE RIGHT.

UH, VIR OR PHYSICAL ONES OR POWER PURCHASE AGREEMENTS GENERALLY HAVE A SET DELIVERY POINT, SUCH AS OUR WASTEWATER SOLAR SITE.

IT GOES, IT'S A BEHIND THE METER.

IT GOES TO OUR FACILITY.

WE KNOW WHERE THAT ENERGY IS GOING.

UH, GENERALLY YOU NEED AVAILABLE LAND, UH, SPACE FOR IT.

UH, THE AGREEMENT HAS A FIXED PRICE OVER A SET TERM, IN THIS CASE, A LITTLE OVER SEVEN AND A HALF CENTS FOR THAT AGREEMENT FOR 20 YEARS.

UH, YOU HAVE DIRECT, GENERALLY A DIRECT RELATIONSHIP WITH THAT ENERGY SUPPLIER.

IF THERE'S A, UH, ISSUE THAT COMES UP WITH THE SOLAR ARRAY, YOU CAN CALL THEM DIRECTLY AND GET SOME FOLKS ON IT TO SEE HOW IT'S, HOW IT'S WORKING, OR BE ABLE TO FIX AND MAINTAIN THE SYSTEMS. UH, RENEWABLE ENERGY CREDITS ARE POSSIBLE FOR THOSE SYSTEMS. UH, I SAY POSSIBLE BECAUSE YOU DON'T HAVE TO HAVE RENEWABLE ENERGY CREDITS IN A POWER PURCHASE AGREEMENT, BUT YOU GENERALLY DO LIKE THEM.

UH, SO, UH, THEY'RE POSSIBLE WE WOULD WANT THEM, UH, FOR, FOR OUR PURPOSES.

UH, AND AS I MENTIONED, THEY'RE GENERALLY LONG-TERM AGREEMENTS.

THE DIFFERENCE WITH THE VIRTUAL POWER PURCHASE AGREEMENT IS ESSENTIALLY THAT ENERGY DOESN'T COME DIRECTLY TO US, BUT IT HAS TO GO SOMEWHERE.

UH, AND SO THAT ENERGY IS ULTIMATELY SOLD INTO A WHOLESALE MARKET.

WHAT OCCURS, UH, FOR THE PEOPLE THAT ARE ENTERING INTO, UH, ORGANIZATIONS THAT ARE EARNING IN A VIRTUAL POWER PURCHASE AGREEMENT IS KNOWN AS ESSENTIALLY A CONTRACT FOR DIFFERENCES.

UH, YOU AG, UH, THE ENTITY AGREES TO BUY THE ENERGY AT A SET PRICE KNOWN AS A STRIKE PRICE.

AND THEN WHEN THE, UH, ENERGY IS THEN SOLD INTO THE WHOLESALE MARKET, IF IT BEATS THE STRIKE PRICE, THERE'S A TRANSFER SETTLEMENT THAT GOES TO THE ORGANIZATION.

IF THE ENERGY WAS LOWER THAN THE STRIKE PRICE, UH, THE ORGANIZATION THEN PAYS TO ESSENTIALLY MAKE UP THAT DIFFERENCE.

IT IS USED FOR, UH, CREATING NEW ENERGY PRODUCTION, UH, AS WELL AS I MENTIONED, UH, SOURCING, UH, RENEWABLE ENERGY CREDITS, UH, AND GENERALLY HAVE A LONG-TERM COMPONENT TO 'EM, ABOUT 10 TO 25 YEARS, SIMILAR TO PHYSICAL POWER PURCHASE AGREEMENTS.

SO, UH, THIS DIAGRAM WAS PROVIDED BY THE EPA GREEN POWER PARTNER PROGRAM.

UH, I'M JUST GONNA COVER A COUPLE OF THE DIFFERENT ASPECTS HERE.

ESSENTIALLY, THERE'S THREE LEGS OF A VIRTUAL POWER PURCHASE AGREEMENT.

UH, THIS UPPER LEG, I'M GONNA CALL LEG ONE.

UM, THIS IS WHAT'S ESSENTIALLY OCCURRING IN OUR ENERGY MARKET RIGHT NOW.

UH, THE YELLOW ORANGE-ISH LINE, UH, THAT IS ESSENTIALLY THE DIRECTION OF THE ENERGY, AND THEN THE GREEN LINES, ESSENTIALLY, WHERE THE PAYMENTS ARE GOING TO.

AND THEN, UH, BLUE LINES ARE ESSENTIALLY REPRESENTING RECS.

SO IN OUR CURRENT LEG, UH, A PS IS ACTING AS OUR UTILITY.

UH, THE POWER MARKET, UH, THEY SOURCE ENERGY FROM WITHIN THE MARKET.

SOME OF THEM, THEY'RE THEIR OWN ASSETS.

SOME OF THEM ARE, THEY PURCHASE ELSEWHERE, BUT THEN THEY KIND OF FUNNEL ALL THAT ENERGY TO US AND TELL US IT'S GONNA COST X AMOUNT OF CENTS PER, PER KILOWATT HOUR.

THE SECOND LEG HERE, UH, THAT INCORPORATES DOWN TO THIS RENEWABLE ENERGY GENERATOR.

THAT IS ESSENTIALLY A PPA.

THAT'S WHAT THE CITY'S DONE BEFORE.

UH, THIS IS MAKING THE AGREEMENT WITH THE ENTITY TO BUILD A NEW RENEWABLE SITE.

THAT ENERGY, UM, COULD THEN GO DIRECTLY TO THE CUSTOMER, OR IT COULD PHYSICALLY GO TO THE UTILITY ITSELF, BUT THEN THE WRECKS FROM THAT RENEWABLE SITE COME TO THE CITY, AND THEN THE CITY PAYS A SET PRICE FOR THAT ENERGY.

[00:15:01]

SO IT GOES TO A SECONDARY MARKET THAT WOULD NOT BE THE CITY OF SEDONA IN THIS INSTANCE.

THAT MARKET AGREES TO PAY THAT ENERGY AT A SET RATE.

AND THEN THE DIFFERENCE BETWEEN THOSE TWO PAYMENTS OF WHAT THE VIRTUAL POWER PURCHASE AGREEMENT SAID, AND WHAT THE MARKET SAID IS WHAT ESSENTIALLY IS THE TRANSFER SETTLEMENT THAT'S REPRESENTED BY THIS, UH, LEFT UP UPWARD, DOWN GREEN ARROW, STEP THREE HERE.

UH, SO WE'VE DONE STEP ONE.

WE'VE DONE STEP TWO, OR LEG ONE AND LEG TWO.

WE HAVE NOT DONE LEG THREE.

AND THAT KIND OF ADDS THE, THE KIND OF NEW COMPLEXITY, UH, TO A RESPECTIVE PROJECT OF THIS NATURE.

SO YOU MAY BE ASKING YOURSELVES, WHERE DO THESE, UH, OCCUR, LIKE ACROSS THE COUNTRY? UH, WHERE WOULD WE PUT ONE? WHERE, WHERE DO THEY EXIST? UH, SO THIS MAP, UH, IS TO KIND OF SHOW WHERE VIRTUAL POWER PURCHASE AGREEMENT MARKETS EXIST, UH, SO EXISTS IN A GOOD CHUNK OF THE, THE COUNTRY.

BUT AS YOU CAN SEE, THERE'S A BIT OF A GAP HERE, UH, ON THE WESTERN STATES, UH, THAT IS CURRENTLY, UH, DOES NOT HAVE A VIRTUAL POWER PURCHASE MARKETS IN THEM.

WHAT WE ARE.

THANK YOU MAYOR.

CAN WRIGHT, CAN YOU SPECULATE AT ALL ABOUT WHY, YOU KNOW, YOU'VE GOT THIS MOUNTAIN WEST THAT'S BLANK, AND THEN THE SOUTHEAST IS LARGELY BLANK.

IS THAT A MATTER OF POLITICS? IS IT, UM, JUST COPIOUS AMOUNTS OF ENERGY ALREADY AVAILABLE? LIKE ANY SPECULATION ON THAT? UH, SOME OF IT, UH, COULD BE RELATED TO, TO POLICIES AND, AND POLITIC COMPONENTS TO 'EM.

UH, THE, UH, OTHER COMPONENT IS JUST THE WAY THAT THE MARKET STRUCTURE IS SET UP IN EACH INDIVIDUAL STATE.

UH, FOR US HERE, DISTINCTLY REGULATED MARKET, YOU HAVE, UH, ONE SERVICE PROVIDER, AND THAT SERVICE PROVIDER GETS TO DECIDE WHAT ENERGY IS PROVIDED TO THE RESIDENTS IN THAT AREA.

SO THAT HAPPENS TO US.

WE DON'T HAVE RETAIL CHOICE.

UH, SO THAT KIND OF RESTRICTS, UH, A LOT OF THAT.

SO, UH, THE STATES THAT, UH, HAVE, UH, ARE WHITE IN THIS MAP, ESSENTIALLY DON'T HAVE THE ABILITY FOR RETAIL CHOICE, OR THEY'VE RESTRICTED THAT TO AN EXTENT.

UH, THE MARKETS THAT, UH, HAVE THAT THEY MIGHT STILL BE REGULATED, BUT THEY'VE ALLOWED FOR FLEXIBILITY FOR FOLKS TO BE ABLE TO GO OUT AND SOURCE DIFFERENT, UH, RENEWABLE SITES.

UH, AND ONE THING OF INTEREST, UH, FOR US AS WE'VE, UH, LEARNED MORE ABOUT VIRTUAL POWER PURCHASE AGREEMENTS AND, AND THE ENERGY MARKET AS A WHOLE, IS THAT IT'S ANTICIPATED HERE THAT THIS, UH, MIDDLE, UH, SOUTHWEST POWER POOL, WHICH I, UH, GET A LITTLE BIT OF A KICK OUT OF.

'CAUSE IT SAYS SOUTHWEST, BUT IT'S VERY CLEARLY IN THE MIDDLE OF THE COUNTRY.

BUT, UH, THIS, UH, POWER POOL IS ANTICIPATED TO EXPAND WESTWARD.

UH, THEY'RE CURRENTLY, UH, GOING THROUGH NEGOTIATIONS IN DIFFERENT, UH, CONTRACTUAL STUFF OR THE LIKE, UH, IT'S POTENTIALLY, UH, EXPANDING IN ABOUT 20, 27 OR SO.

UH, FOR MUNICIPAL OPERATIONS, OUR DECARBONIZATION ROADMAP, UH, WAS ESTIMATING THAT ON ONSITE, UH, SOLAR WOULD COST ABOUT THREE, UH, THREE AND A QUARTER OR SO, OR 3.3, UH, MILLION DOLLARS FOR A DIRECT CIP PROJECT.

UH, SO TALK A LITTLE BIT ABOUT THE POWER PURCHASE AGREEMENTS, HOW THEY WORK, UH, A LITTLE BIT ABOUT WHERE THEY FUNCTION.

AND SO NEXT QUESTION WAS LIKE, WHY WOULD WE LOOK AT THESE? UH, IT'S A WAY TO ADVANCE, UH, KIND OF CLEAN, CLEAN ENERGY GOALS.

IF YOU'RE IN A MARKET SIMILAR TO OURS WHERE WE DON'T HAVE A LOT OF OPTIONS, UH, IT CAN ALLOW YOU TO BUILD A NEW RENEWABLE SITE, UH, IN A LOCATION THAT ALLOWS FOR IT WITHIN THEIR MARKETS.

AND ALSO IT HELPS YOU ADVANCE THOSE CLEAN ENERGY GOALS.

IT CAN GUARANTEE YOU A LONG SOURCE, LONG TERM SOURCE OF QUALITY RECS.

UH, AS I MENTIONED WITH THE GREEN POWER PARTNERS PROGRAM, THAT WAS, UH, REX IS, THAT WAS ASSOCIATED WITH EXISTING RENEWABLE SITES.

UH, IT HAS AN ADVANCED A PS TO BUILD NEW RENEWABLES.

UH, THERE'S SOME THINGS THAT ARE, ARE TAKING PLACE THAT, UM, PUTS THAT INTO QUESTION ON HOW MANY, HOW MUCH MORE RENEWABLES THEY WILL BRING ONLINE, UH, COMING FORWARD.

UM, FOR US, AT A MUNICIPAL LEVEL, IT WOULD APPLY TO ABOUT 50% OF OUR ANNUAL EMISSIONS, UH, RELATED TO ELECTRICITY.

UH, THERE IS A POTENTIAL TO SCALE WITH IT.

UH, SO GENERALLY IF YOU DO A PHYSICAL POWER PURCHASE AGREEMENT OR YOU'RE, UH, ENTERING AN AGREEMENT WITH A PS AND THE, LIKE, THEY'LL, THEY'LL LOOK AT WHAT YOU PHYSICALLY USE RIGHT THEN AND THERE, AND THEY'LL KIND OF TIE THAT ENERGY TO IT.

UH, FOR A VIRTUAL POWER PURCHASE AGREEMENT, WE COULD THEORETICALLY SOURCE, UH, MORE RECS OR MORE ENERGY THAT GOES BEYOND OUR SMALL MUNICIPALITY AND TRIES TO APPLY THE CREDITS TO A LARGER SCALE TO IT.

SO IT IS A POTENTIAL OPTION.

UH, ALSO, IT COULD ACT AS A POTENTIAL HEDGE AGAINST UTILITY COSTS.

UH, IF THE, UH, MARKET THAT IS THE ENERGY IS SOLD INTO ROUTINELY OUTPERFORMS YOUR STRIKE PRICE, THEN THAT ESSENTIALLY THAT, UH, OVERAGE THAT YOU GET, ESSENTIALLY OFFSETS WHAT YOU'RE, UH, WHAT YOU'RE PAYING ON YOUR OWN UTILITIES.

SO IT CAN ACT AS A HEDGE SOMETIMES.

UH, IT'S AN OPTION FOR FOLKS THAT ARE IN AREAS THAT HAVE LIMITED, UH, LIMITED OPTIONS WITHIN THE STATE AS WE ARE.

UH, IT'S POTENTIALLY, UH, MORE COST EFFECTIVE THAN ONSITE SOLAR FOR CERTAIN AREAS.

UH, JUST FOR REFERENCE FOR, FOR US HERE,

[00:20:01]

UH, AND THAT WAS BEFORE, UH, A LOT OF THE, UM, TAX INCENTIVES AND CREDITS AND THE LIKE, HAVE NOW SINCE BEEN PHASED OUT.

SO THE ROI ON THAT, ON A SOLAR ON SITE, COULD BE ELONGATED.

SO THIS POTENTIALLY HAS AN OPTION TO KIND OF BRING ON RENEWABLES IN A COST EFFECTIVE MANNER.

BUT IT IS, THERE ARE SOME CHALLENGES WITH IT, THOUGH.

UM, THE INITIAL AGREEMENTS ARE COMPLEX.

UH, YOU HAVE THE ASPECT WHERE THE ENERGY IN THE MARKET GOES UP, ONE MONTH GOES DOWN THE NEXT MONTH, AND THERE'S A SETTLEMENT PRICE THAT THEN HAS TO BE TRANSFERRED TO THE ENTITY.

THAT INITIAL AGREEMENT TAKES SOME TIME.

SO IT CAN BE A COMPLEX, UH, COMPONENT TO IT.

UH, THIS MONTHLY PRICE FLUCTUATION THAT I MENTIONED, UH, THIS IS ALSO FROM THE EPAS GREEN POWER, UH, PARTNER.

AND KIND OF AN EXAMPLE OF WHAT IT LOOKS LIKE.

UM, SO THIS KIND OF DOTTED LINE HERE IN THE UPPER RIGHT GRAPH THAT IS ESSENTIALLY LIKE WHAT YOUR STRIKE PRICE IS.

THAT'S WHAT YOU'VE AGREED TO THE ENERGY AT, UH, THIS UP, DOWN, UH, LINE, THAT IS ESSENTIALLY WHAT THE WHOLESALE MARKET IS BUYING THAT ENERGY.

SO WHEN THE MARKET GOES UP, THEN COOL, WE GET A, A TRANSFER SETTLEMENT THAT WE RECEIVE THE MONEY.

WHEN THE MARKET GOES DOWN, THEN YOU END UP HAVING TO PAY MONEY TO IT.

SO THAT LITTLE, IT'LL KIND OF FLATTEN ITSELF OUT, AND YOU'LL GET AN AVERAGE OVER TIME.

BUT ON A MONTH TO MONTH BASIS, IT'LL KIND OF FLUCTUATE A BIT.

UH, THE EFFECTIVENESS, OH, YEP.

SORRY.

HOLD ON.

PRICE.

AND YOU'VE BEEN WATCHING THAT TRENDING.

YOU'RE, YOU'RE AWARE OF WHAT THAT TRENDING HAS BEEN SO THAT IT'S MORE TO THE GOOD OR TO THE NEGATIVE, WHICH JUST, CAN YOU GIMME A LITTLE MORE INSIGHT ON THAT, PLEASE? MM-HMM .

UH, HISTORICALLY THEY'VE BEEN, UH, OVERALL PRETTY GOOD.

UH, 'CAUSE IT GUAR, UH, IT GOOD IN THE SENSE FOR THE PURCHASE.

THE PERSON THAT IS ENTERING INTO THE VPPA, THE MARKET HAS BEAT THE, THE STRIKE PRICE.

UH, THE STRIKE PRICE OR THE AGREEMENT ESSENTIALLY, UH, PROVIDES COST CERTAINTY TO THE DEVELOPER, UH, THAT THEY KNOW FOR SURE THAT THERE IS A BASELINE THAT'S COMING TO IT.

UH, HISTORICALLY, UH, THEY HAVE, UH, KIND OF OUTPERFORMED THE MARKET.

UM, THAT IS SOMETHING THAT WE, UM, THROUGH THIS POTENTIAL PROCESS IS THAT WE WOULD LEAN HEAVILY ON NA U'S, UH, CONSULTANTS FOR THAT MODELING ASPECT TO BE ABLE TO COME BACK AND SAY LIKE, THIS IS WHAT THE MARKET, UH, IS ENTAILING TODAY WITH ALL THE CHANGES THAT HAVE OCCURRED, BUT HISTORICALLY, THEY HAVE PERFORMED.

WELL.

DEREK, HOW IS THE, MAYBE YOU SAID THIS, BUT HOW IS THE STRIKE PRICE DETERMINED? HOW IS THAT, IS THAT A MATTER OF NEGOTIATION? IS IT A FORMULA? IS IT A BIT OF A FORMULA AND A BIT OF NEGOTIATIONS TO IT? UM, SO FOR INSTANCE, I'M JUST USING AN EXAMPLE HERE, BUT, UH, SAY THE STRIKE PRICE IS LIKE $40, AND THE ENTITY THAT'S ENTERING INTO IT REALLY WANTS TO AVOID, UH, COST VARIABILITY.

WE REALLY DON'T WANT THE DIPS.

WE DON'T WANNA BE PAYING IT.

SO IN, UH, THERE'S INSTANCE MECHANISMS WITHIN THE CONTRACT THAT YOU COULD SAY, WELL, IF WE SAY THE MARKET OUTPERFORMS AND GOES TO $70, WE WON'T TAKE THAT $30 DIFFERENCE.

WE'LL TAKE LIKE 15 OF IT.

SO THE DEVELOPER WOULD GET THE POCKET, THE OTHER 15.

AND IN THAT, IN LIEU OF THAT, PROVIDING THAT, UH, ASSESSMENT, IT CAN LIKE LOWER YOUR STRIKE PRICE TO LIKE COMPENSATE, UH, FOR YOU NOT GETTING AS MUCH OF THE BENEFIT.

BUT THEN YOU'RE TRYING TO, UH, BALANCE THAT AGAINST THE STRIKE PRICE.

SO SOME OF IT'S NEGOTIATION, SOME OF IT WOULD BE BASED OFF OF, UH, THE OVERALL, UH, PROJECT COSTS THAT IS THEN BALANCED AGAINST, UH, HOW MUCH ENERGY THAT PROJECT IS EXPECTED TO PRODUCE OVER THE, OVER ITS LIFE FRAME, UH, LIFETIME.

SO SOME OF IT WOULD BE, UH, DISTINCTLY FORMULA BASED, AND THEN THERE WOULD BE SOME FLUCTUATIONS BASED OFF NEGOTIATION.

AND IS THE STRIKE PRICE THE SAME THROUGHOUT THE TERM OF THE CONTRACT, OR DOES IT FLUCTUATE AT ANY POINT? GENERALLY, IT'S A SET TERM.

LEVEL, AND THE MARKET IS ROUTINELY A LITTLE BIT BELOW WHERE YOU'RE ANTICIPATING THE STRIKE PRICE, UH, IT COULD BE ABOUT COST COMPETITIVE WITH WHAT WE'RE CURRENTLY PAYING A PS FOR THE GREEN POWER PART, UH, GREEN POWER PARTNERS PROGRAM.

UH, I DO ALSO WANT TO HIGHLIGHT THIS.

UH, THERE'S, UH, WITH THE ASPECTS THAT HAVE CHANGED, UH, AS WE ALL WELL KNOW IN THE LAST, UH, EIGHT MONTHS OR SO, UH, THAT, UH, THERE'S A POTENTIAL INCREASE IN PROJECT COSTS AND DELAYS.

A LOT OF THE INCENTIVES THAT WERE THERE FOR RENEWABLES, UH, HAS BEEN REMOVED.

AND SO THERE'S POTENTIAL THAT THESE PROJECTS, UH, WOULD COST MORE OR BE DELAYED GOING FORWARD.

UH, SO THAT IS SOMETHING OF CONSIDERATION, UH, OF, AS A, OF A CHALLENGE FOR US TO LOOK AT.

UH, IT IS ANTICIPATED THOUGH THAT THE WHOLESALE MARKET OR ENERGY MARKETS ACROSS THE US ARE GOING TO SEE, UH, MARKET INCREASES, UH, WITHIN THEIR, THEIR PRICING STRUCTURES.

UH, AND SO IF YOU'RE ABLE TO GET INTO AN AGREEMENT THAT SAYS, THIS IS WHAT WE'RE PAYING, AND THEN THE MARKET IS JUST CONSTANTLY MOVING UP EACH YEAR, IT COULD BE A BENEFIT, BUT IT'S A, IT'S AN UNKNOWN FOR US AT THIS TIME TO DISTINCTLY SAY ONE WAY OR THE OTHER.

UH, AND I JUST WANT TO FIND SOME REALLY HIGH LEVEL JUST PRELIMINARY COST ESTIMATES TO IT.

UH, IF WE'RE JUST LOOKING AT OUR MUNICIPAL, UH,

[00:25:01]

UH, BUT IT STILL WOULD BE BRAND NEW RENEWABLE ENERGY THAT WAS GENERATED.

IF THE MARKET PERFORMS WORSE, IT COULD COST US MORE.

UH, AS I MENTIONED THOUGH, THERE IS THE POTENTIAL TO, UH, POTENTIALLY EARN ON IT.

UH, I WOULDN'T SAY THAT'S A GUARANTEE, THOUGH, UH, BUT IT JUST VERY BROADLY AT THIS STAGE OF KIND OF WHAT THAT ESTIMATE MIGHT BE FOR US, UH, AT A MUNICIPAL SCALE.

BRYCE, BRYCE, CAN YOU ENLIGHTEN AT ALL ABOUT, YOU KNOW, WHAT DOES CAUSE THE, THE PRICE VARIATION THEN, UH, THAT AFFECTS WHETHER WE'RE TO THE GOOD OR THE BAD? SO IS IT WEATHER? IS IT, UH, NEW CAPACITY COMING ON, OLD CAPACITY GOING OFF? ANYTHING YOU CAN SHARE ON THAT? UH, GREAT QUESTION.

COUNCILLOR FUL.

UM, THE FLUCTUATIONS THAT OCCUR CAN BE, UH, I'LL, I'LL, I'LL USE TEXAS AS AN EXAMPLE HERE.

UM, A FEW YEARS AGO WHEN, UH, THE MARKET, UH, OR WHEN THE, THAT DEVASTATING, UH, COLD SNOW STORM CAME IN AND IT HIT TEXAS HARD, UH, THEY'RE IN A MARKET THAT ALLOWED FOR A LOT OF FLUCTUATION, UH, WITHIN IT.

SO IF YOU HAPPEN TO BE A VIRTUAL POWER OR A POWER GENERATOR DURING THAT TIME AND ONLINE, UH, WHEN EVERYBODY ELSE WENT DOWN AND YOU'RE STILL OPERATING, THEN YOUR, UH, WHOLESALE MARKET PRICE GETS TO SPIKE.

UH, AND SO ON THAT INSTANCE, YOU'RE DOING VERY WELL BECAUSE YOU'RE THE, LIKE THE LAST ONE STANDING, SO TO SPEAK.

UM, IN AN INSTANCE WHERE, UH, A MARKET COULD BE, UH, FLOODED WITH, UH, SAY A BUNCH OF SOLAR AT EXACTLY THE, UH, THE DISTINCT SAME TIME, THEN THE MARKET WOULD START TO DROP, AND THEN YOU GET HIT ON AGREEING TO PAY OVER THAT.

UH, SO PART OF IT WOULD BE JUST HOW MUCH IS ONLINE AT THAT TIME.

ALSO, PART OF IT WOULD BE WEATHER RELATED, UH, WHETHER OR NOT A COAL PLANT WENT DOWN, WHETHER OR NOT YOU'RE STILL FUNCTIONING.

UH, SO THERE ARE KIND OF A VARIETY OF FACTORS THAT PLAY INTO THAT.

UH, SO I DO WANNA COVER THIS REALLY, UH, UNIQUE OPPORTUNITY, UH, OR, UH, POTENTIAL FOR US IS, UH, THIS ARIZONA CONSORTIUM.

SO, UH, NORTHERN ARIZONA UNIVERSITY HAS BEEN IN THE SAME BOAT OF JUST TRYING TO FIGURE OUT HOW DO YOU, HOW DO WE GET MORE, UH, RENEWABLES, UH, ON ONLINE? HOW DO WE DO IT IN A EFFECTIVE WAY TO GET THE, BE ABLE TO ADVANCE OUR GOALS? UH, AND SO FOR THE LAST TWO YEARS, NAU HAS KIND OF BEEN PURSUING THIS EFFORT, UH, AND BRINGING TOGETHER A GROUP OF PEOPLE ACROSS THE STATE, UH, WHICH INCLUDES THEMSELVES UP THERE IN FLAGSTAFF, UH, AS WELL AS THE CITY OF FLAGSTAFF, UH, ARIZONA STATE UNIVERSITY, UH, THE CITY OF TEMPE, THE CITY OF PHOENIX, AS WELL AS AS HERE AT THE CITY OF SEDONA.

UH, THE, UH, ARIZONA STATE UNIVERSITY HAS ACTUALLY, UH, ENTERED INTO A VIRTUAL POWER PURCHASE AGREEMENT BEFORE.

SO THEY HAVE SOME DIRECT KNOWLEDGE ON THE INNER WORKINGS OF THEM.

AND SO WE WOULD BE LEANING HEAVILY ON, UH, THEIR RESPECTIVE KNOWLEDGE, UH, AND THE LIKE, AS WELL AS, UH, OUTSIDE COUNSEL AND, UH, TO KIND OF NAVIGATE, UH, THESE COMPONENTS, UH, AND AS, AS WELL AS THE, UH, U SOURCE TEAM THAT NEU BROUGHT ON AS CONSULTANTS FOR THE, UH, VIRTUAL POWER PURCHASE INITIATIVE.

UH, TO BE ABLE TO HELP US NAVIGATE THIS AS A WHOLE, AS I MENTIONED, UH, EARLIER, UH, WITH OUR RELATIVELY SMALL, UH, MUNICIPAL ENERGY SIZE, US DOING THIS ALONE IS A CHALLENGE.

UH, SO US BEING ABLE TO PULL TOGETHER WITH, UH, FOLKS THAT ARE MUCH SIGNIFICANTLY LARGER THAN US HAVE WORKED IN MANY OF THESE AGREEMENTS BEFORE.

UH, IT ALLOWS US TO KIND OF, UH, BUILD THEIR COLLECTIVE KNOWLEDGE AND NAVIGATE THE, THE KIND OF CHALLENGES AND PITFALLS WITHIN THEM.

UH, IT AS, UH, IT CAN SEND TO ADDITIONALLY AS LIKE A MARKET SIGNAL, UM, TO THE AREA THAT AS WE SEE THE, UH, ARIZONA CORPORATION COMMISSION, UH, LOOK TO REPEAL, UH, RENEWABLE ENERGY STANDARDS AND A PS SOFTEN SOME OF THEIR CLEAN ENERGY GOALS, UH, AS A WHOLE, AS A MARKET.

THE, THIS GROUP IS TRYING TO FIND CLEAN ENERGY OPTIONS, UH, THAT IS ESTIMATED TO BE ABOUT 600 OR A LITTLE OVER 666,000 MEGAWATT HOURS.

UH, FOR US, UH, MUNICIPALLY, WE'RE ONLY ABOUT FOUR TO 5,000 OR SO, SO WE'RE THE SMALL DROP IN THE BUCKET.

BUT US BEING ABLE TO, UH, ESSENTIALLY PLAY IN THIS BIGGER POND, SO TO SPEAK, UH, IT GIVES US THE ECONOMIES A SCALE THAT CAN GIVE US, UH, FLEXIBLE PRICING AND A POTENTIAL AGREEMENT FOR US TO EXPLORE.

UM, THAT LITTLE YELLOW SLIVER BETWEEN THE GREEN AND THE BLUE IS US AND TEMPE COMBINED.

AM I READING THAT CORRECTLY? I THINK THIS GRAPH IS MISSING TEMPE.

UH, TEMPE IS MUCH, MUCH LARGER THAN, THAT'S WHAT I WAS WONDERING, SO, OKAY.

SO I, I WILL GET YOU AN UPDATED GRAPH ON THAT ONE.

MY APOLOGIES.

ALRIGHT, SO WITH THAT, I JUST KIND OF WANNA, UH, OPEN

[00:30:01]

UP FOR DISCUSSION.

UH, WHAT ARE THE CONCERNS, DESIRES, UH, UH, OF A POTENTIAL VPPA OPTION, UH, AS WELL WITH THIS, UH, SINCE IT IS A, A NEW, UH, OPPORTUNITY THAT I MIGHT NOT BE ABLE TO ANSWER ALL THE QUESTIONS FOR ANYTHING THAT YOU HAVE, UH, THAT I CAN, UH, UH, THAT I CAN TAKE AND CHAT WITH OUR NEU TEAMS AND OUR, AND THE U SOURCE TEAM, UH, TO BE ABLE TO ANSWER THOSE QUESTIONS MORE FULL FULLY.

UH, AT THE MOMENT, WE'RE KIND OF EXPLORING IT AS JUST MUNICIPAL SCALE.

UH, BUT I DO WANT TO JUST AS, UH, TO THE COUNCIL AS A WHOLE, ARE YOU INTERESTED IN IT AS SEEING IF WE WANT TO TRY TO, TO BITE IT OFF A BIGGER CHUNK OF ENERGY THAT WOULD APPLY TO A MORE COMMUNITY LEVEL.

I JUST KIND OF WILL POSE THAT AS A MORE BROADER QUESTION FOR THIS.

BUT, UH, AT THIS POINT, REALLY OPEN ANY, ANY QUESTIONS, UH, COMMENTS, DISCUSSION FOR IT.

DEREK, DO YOU HAVE ANY QUESTIONS? SO, WOULD WE, WOULD THE CITY OF SEDONA HAVE ITS OWN VPPA WITH WHOMEVER, OR WOULD THIS BE A JOINT AGREEMENT WITH THE UNIVERSITY CITY FLAGSTAFF? HOW, HOW WOULD THAT BE STRUCTURED? THE, UH, IT'S ANTICIPATED THAT THE, WE'D HAVE A SELECTION PROCESS, UH, TAKE PLACE.

UH, POTENTIAL, UH, PROJECT IS SELECTED.

IT WOULD BE BROUGHT BEFORE COUNCIL, UM, TO SAY WHETHER OR NOT WE LIKE THAT PROJECT.

UH, THE, UM, FROM MY UNDERSTANDING, THE OUTSIDE COUNCIL WOULD HELP US WITH THE NEGOTIATION OF THE OVERALL VIRTUAL POWER PURCHASE AGREEMENT FOR THE SAME PROJECT.

BUT THEN EACH INDIVIDUAL ENTITY WOULD HAVE ITS OWN DISTINCT VIRTUAL POWER PURCHASE AGREEMENT.

UH, BUT THAT AGREEMENT IS NEGOTIATED AS A WHOLE THOUGH.

SO TO FOLLOW THAT UP, SO WE, WE CAN OPT IN CASE BY CASE.

YES.

I DON'T HAVE ANY OTHER QUESTIONS, KATHY.

YEAH, I DO HAVE A QUESTION REGARDING, UH, WOULD COUNCIL LIKE TO PURSUE ENERGY BEYOND MUNICIPAL CONSUMPTION EXPAND TO A COMMUNITY SCALE? COULD YOU, WHAT, WHAT, WHAT WOULD THAT ENTAIL? THE COMMUNITY SCALE GIVE CAN BE A LITTLE MORE SPECIFIC.

UH, SORRY, I'LL BACKTRACK.

UH, ONE SECOND.

SO, FOR, FOR THIS RESPECTIVE PROJECT, UH, AS A SENSE, A TIMELINE OF WHAT WE'D BE LOOKING AT, UM, THE SELECTION PROCESS WOULD GO INTO 2026.

IF, UH, A NEGOTIATION OR A PROJECT, UH, WAS APPROVED AND EVERYBODY LIKED IT, UH, WE WOULDN'T BE ANTICIPATING THE ACTUAL RECEIPT OF THOSE RENEWABLE ENERGY CREDITS UNTIL ABOUT 27, 28 TIMEFRAME WHEN THE, UH, ENERGY SITE IS ACTUALLY BUILT.

WITH THAT IN MIND, UH, IF WE WERE TO PROCURE ENERGY THAT WAS BEYOND OUR MUNICIPAL CONSUMPTION, IT WOULD HAVE THE ABILITY FOR THE CITY TO HAVE RENEWABLE ENERGY CREDITS THAT ARE BEYOND WHAT WE DIRECTLY USE.

AND THEY COULD THEORETICALLY THEN BE APPLIED TO, UH, THE RESIDENTS OR THE COMMUNITY, AND THE RESIDENTS COULD EITHER SIGN UP FOR IT OR THE LIKE, UH, TO BE ABLE TO LIKE, UH, TRANSFER OR RETIRE THOSE RENEWABLE ENERGY CREDITS ON THEIR BEHALF.

UH, WE WOULD HAVE ABOUT A TWO, THREE YEAR WINDOW KIND OF TO BE ABLE TO BUILD OUT ALL OF THE LOGISTICS INTO THAT PROGRAM.

UH, AT THE MOMENT, UM, DISTINCTLY ON LIKE HOW MUCH STAFF TIME OR THE, THE, LIKE, THAT WOULD OCCUR WITH THAT, UH, I DON'T HAVE A, A, A GREAT, UH, A GREAT ANSWER FOR YOU AT THE MOMENT.

UH, MY INITIAL THOUGHT WITH THIS IS TO PURSUE IT AS, UH, AS A MUNICIPAL LEVEL WITH, AS WHAT WE LEARN FROM IT THAN BE ABLE TO BUILD OFF AND PURSUE A, A BIGGER CHUNK, UH, IN A FUTURE, UH, OPPORTUNITY.

UH, BUT THE ASPECT OF THE WORKINGS THAT I HAVE RIGHT NOW IN MY HEAD IS THAT YOU WOULD HAVE THESE RECS AND THEN YOU WOULD WORK ON A PROGRAM THAT WOULD THEN TRANSFER THE, THE RECS DIRECTLY TO RESIDENTS IN THE, THE, THE, UH, LIKE BUSINESSES IN THE AREA FOR A SENSE OF, UH, SCALE, IF THIS IS, IF THIS IS HELPFUL, UM, THE MUNICIPALITY USES ABOUT 5,000, 4,000, 5,000 MEGAWATT HOURS A YEAR, UH, FOR THE COMMUNITY AS A WHOLE.

THE AREA USES ABOUT 167,000, UH, MEGAWATT HOURS.

DID THAT, DID THAT HELP? YES, IT DID.

I GOT IT.

BRIAN, THIS IS ALMOST LIKE A TAG ON TO COUNCILOR KINSELLA.

THE MOST CLEAR, UH, FOR THIS AND RENEWABLE ENERGY CREDITS.

BRYCE, CAN YOU MAKE REX A LITTLE MORE REAL FOR US? LIKE, I'M LOOKING AT THE EPA WEBSITE AND ITS DEFINITION, AND IT'S TALKING ABOUT A MARKET-BASED INSTRUMENT THAT REPRESENTS THE PROPERTY RIGHTS TO THE ENVIRONMENTAL, SOCIAL, AND OTHER NON-POWER ATTRIBUTES OF RENEWABLE ELECTRICITY GENERATION.

THAT'S A LOT OF WORDS, AND I'M, YOU KNOW, ULTIMATELY WE'RE GONNA HAVE FOLKS ASKING, OKAY, IS THERE MORE TO THIS THAN ESSENTIALLY VIRTUE SIGNALING? YOU KNOW, WHAT, HOW DO YOU MAKE THIS REAL? UH, HOW DO I MAKE THIS, UH, REAL? THAT'S A GREAT QUESTION.

UH, EPA DEFINITIONS AREN'T ALWAYS THE

[00:35:01]

WHAT WE'D BE LOOKING FOR IS YOU'D BE ABLE TO DIRECTLY POINT TO IT AND BE LIKE, THAT SOLAR FARM, THAT WIND FARM THAT'S OURS, AND THAT ENERGY THAT'S GENERATED OFF OF IT, THAT IS A HUNDRED PERCENT OURS.

AND FROM THAT ASPECT, IT'S LIKE THERE, IT WOULDN'T BE JUST A PIE IN THE SKY OF JUST US SAYING LIKE, OH, YEAH, WE, WE, WE PRESERVED A SECTION OF FOREST AND WE OFFSET COMPONENTS TO IT.

IT'D BE A BRAND NEW PHYSICAL SITE THAT WAS BUILT THAT THE CITY OR THE ENTITIES PARTICIPATED IN COULD DIRECTLY POINT TO AND SAY, THAT WAS 100% OUR PROJECT THAT WE CREATED.

IS THAT HELPFUL? SOMEWHAT.

SO WOULD OUR PARTICIPATION IN THIS, ASSUMING THAT THE MAP YOU SHOWED OF WHERE V PPAS EXIST OR THE GENERATION FOR THEM EXIST NOW, AND RECOGNIZING THAT ARIZONA'S A BIG WHITE SPOT, RIGHT? AND THAT'S NOT LIKELY TO CHANGE EITHER DUE TO INACTION BY OUR STATE LEGISLATURE OR ANY ENCOURAGEMENT BY THE A CC, RIGHT? SO BY PARTICIPATING IN THIS, DO WE FOSTER AN ONGOING LAGGARD BEHAVIOR IN OUR OWN STATE, OR DOES THIS AT SOME POINT FOR SOME, IN SOME WAY, I'M JUST NOT PICTURING, DOES IT ACTUALLY WIND UP ENCOURAGING THE STATE OF ARIZONA TO IN VERY MODERNIZE? GREAT QUESTION.

UH, I FORGOT TO MENTION AS A, A PORTION OF THE PROPOSED IGA IS THAT BOTH, UH, A PS AND SRP, UH, IN PARTICULAR WOULD BE, UH, ENGAGED WITH DURING THIS PROCESS.

SO WOULDN'T IT JUST BE THE CONSORTIUM SEEING AND WHAT'S OUT THERE AND, UH, ALL THE OTHER STATES? UH, WE DEFINITELY WANNA KNOW WHAT A PS AND SRP CAN DO TO, TO, TO MEET OUR GOALS.

UH, AND SO THAT WOULD NOT BE, UH, LOST IN THE, IN THIS PROCESS.

SO MY APOLOGIES FOR, FOR, UH, FORGETTING TO MENTION THAT, THAT THAT COMPONENT IS DISTINCTLY IN THERE THAT WE WANT TO BE ABLE TO GO DIRECTLY TO A PS AND SRP AND LIKE, WHAT DO YOU HAVE FOR US? UH, RIGHT NOW, WHAT ESSENTIALLY GETS PITCHED TO US IS, UM, THE GREEN POWER PARTNERS PROGRAM.

THERE'S THREE DIFFERENT OPTIONS THAT THEY, THEY, THEY POSE, THEY'RE ALL COST ADDITIVE.

IT'S, YOU'LL PAY YOUR GOING RATE AND YOU'LL PAY A TARIFF, AND THEN YOU'LL PAY INCREMENTAL CAPITAL COSTS TO ACTUALLY BUILD IT.

UH, BUT WE KNOW SOLAR AND WIND FARMS CAN BE SIGNIFICANTLY CHEAPER THAN THAT.

SO, UH, WE'RE HOPEFUL THAT THIS, UH, THIS EFFORT CAN THEN SIGNAL TO BOTH A PS AND SRP OF LIKE, WE WANT ACTION HERE.

THIS IS A FAIRLY LARGE ENERGY SOURCE, AND WE WANT TO SEE YOU TO MAKE PROGRESS IN THIS.

ALL OF US THAT ARE IN, THAT HAVE IN THIS DISCUSSION OF TALK, WOULD LOVE TO SEE A PS AND THE STATE PUSH THIS FORWARD.

UH, AND SO WE WANT TO HAVE THAT AS PART OF THE PROCESS, UH, WITH IT, BUT WITH, UH, IN LIGHT OF WHERE WE'RE AT, IT'S LIKE WE'RE TRYING TO SEE, LIKE IF THAT'S NOT GONNA HAPPEN, WHAT OPTIONS DO WE HAVE? OKAY.

I DON'T KNOW IF THAT, IF ANSWERED YOUR QUESTION.

SO LAST WEEK AT THE LEAGUE CONFERENCE, AND A YEAR AGO AT THE LEADING CONFERENCE, WE HEARD SRP TALKING ABOUT THE FACT THAT THEY BELIEVE THEY NEED TO DOUBLE THEIR POWER GENERATION IN WHAT, LIKE LIKE IN FIVE YEARS OR 10 YEARS OR SOMETHING LIKE THAT, LIKE IN A VERY SHORT TIME PERIOD.

AND THEY LOVE TO PUT IT OUT THERE, YOU KNOW, IT'S TAKEN US A HUNDRED YEARS TO GET TO WHERE WE ARE, AND NOW WE GOTTA DOUBLE IN , YOU KNOW, THIS TINY LITTLE PERIOD.

HOW ARE THEY GONNA DO THAT? AND, AND I KNOW I'M GETTING A LITTLE OFF TRACK HERE ON THAT, BUT I MEAN, ARE THEY SERIOUS ABOUT RENEWALS, RENEWABLES, OR ARE THEY LOOKING AT THE LITTLE MICRO NUCLEAR PLANTS, OR WHAT ARE THEY THINKING? FROM MY UNDERSTANDING AT THIS TIME, UH, IT APPEARS THAT TO MEET THE, UH, INCREASED DEMAND THAT'S EXPECTED FROM DATA CENTERS AND AI CENTERS AND THE LIKE, UH, THAT IN ORDER TO MEET THAT, WHAT ESSENTIALLY THE UTILITIES ARE GOING TO DO IS, UH, EXTEND OR INCREASE FOSSIL FUEL, FUEL USAGE, UH, TO MEET IT.

UH, SO NOT SO MUCH OF BUILDING MORE RENEWABLES, UH, IT'S MORE OF, UH, EXTENDING AND UTILIZING MORE FOSSIL FUELS TO MEET THAT DEMAND.

IS, IS THE, THE DIRECTION THAT I AM SEEING THAT THEY'RE KIND OF GOING, UH, JUST ON AUGUST 7TH, UH, A PS IN PARTICULAR ANNOUNCED THAT THEY WERE, UM, KIND OF, UH, LOOSENING THEIR CLEAN ENERGY GOALS, UH, AS WELL AS EXTENDING THE, UH, DURATION OF THEIR COAL FIRED POWER PLANTS.

UH, AND SO THAT'S KIND OF THAT HINT OF LIKE, AS THEY'RE TRYING TO MEET THAT DEMAND MM-HMM .

THERE'S A VERY HIGH LIKELIHOOD THAT THE MAJORITY OF THAT DEMAND WILL BE MET BY FOSSIL FUELS.

AND THAT'S ALMOST AN INEVITABILITY THEN IT SOUNDS LIKE WITH THE GROWTH REQUIREMENTS THEY'RE ANTICIPATING, AND THAT'S WHETHER IT'S A PS OR SRP AC ACROSS THE GRID, I'D SAY THIS IS A NATIONAL ISSUE ACROSS THE GRID.

UM, THERE WE'RE, WE'RE GONNA HAVE DISTINCT ISSUES WITH THAT.

NOW WE WOULD BE SEEKING TO EDUCATE THE COMMUNITY ABOUT THIS OPPORTUNITY.

AND IF WE BROUGHT IN THE COMMUNITY SCALE ASPECT,

[00:40:01]

AND THIS IS NOT TO BE PEJORATIVE, BUT LITERALLY, HEY FOLKS, YOU WANNA GIVE THIS A GO? YOU'RE, YOU'RE BASICALLY GONNA ROLL THE DICE ON WHETHER THIS IS BETTER OR WORSE FOR YOU THAN WHAT YOU'RE, YOU KNOW, WHATEVER PROGRAM YOU'RE ON WITH A PS CURRENTLY, WHICHEVER PLAN YOU SIGN UP FOR, IS THAT, AGAIN, NOT TRYING TO BE CYNICAL ABOUT IT, BUT JUST THAT, THAT IS SORT OF THE REALITY, RIGHT? LIKE, YOU, YOU'RE NOT GONNA HAVE CERTAINTY THE, THE CONSUMER, IF WE EXTEND TO THE COMMUNITY, THEY'RE NOT GONNA HAVE THE SAME SORT OF CERTAINTY THAT THEY HAVE.

NOW, WOULD THAT BE FAIR FOR THIS PROJECT? YOU WOULD, I BELIEVE YOU'D HAVE THE DISTINCT ABILITY TO SAY, LIKE, FOR A 20 YEAR TIMEFRAME, LIKE THAT ENERGY SOURCE THAT YOU BROUGHT ON DOESN'T GO ANYWHERE.

LIKE, SO FOR 20, FOR HOWEVER LONG THAT AGREEMENT IS.

YOU WOULD GET TO SAY THAT THAT ENERGY IS DISTINCTLY THERE AND THAT IS AVAILABLE, UH, WITH HOW A PS, UH, AND SRP MIGHT VIEW CREDITS NOW, AND WHAT THEY MIGHT DO IN THE FUTURE, UH, THAT WOULD BE MORE UP IN THE AIR ON WHAT HAPPENS ON THEIR OWN PRICE STRUCTURES AND WHAT THEY WOULD WANNA APPLY FOR IF THAT'S, I'M NOT SURE YOU'RE ANSWERING MY QUESTION.

'CAUSE LIKE, YOUR, YOUR GRAPH, THAT'S, I THINK IT'S THE, THE CHALLENGES OF MM-HMM .

VPA IS THAT GRAPH THAT SHOWS RIGHT THERE, RIGHT? THE GRAPH IN THE UPPER RIGHT MM-HMM .

RIGHT? DOESN'T THE CONSUMER FACE THAT GRAPH OR NO? ARE THEY INSULATED FROM THAT? SO THE, UM, I'LL COVER THIS, THIS, UH, THIS LOWER LEFT ONE HERE, THAT'S ESSENTIALLY LIKE WHAT WOULD BE THE, THE CONSUMER'S END, UH, THAT WOULD STILL POTENTIALLY BE THERE? UM, IF THE MARKET, UH, HAPPENED, IF SAY THAT WE ENTERED INTO V-P-A-P-A FOR COMMUNITY SCALE AND IT CONTINUES TO OUTPERFORM, PERFORM THEORETICALLY, YOU WOULD THEN HAVE A POOL OF MONEY, UH, THAT IS ASSOCIATED WITH IT, THAT THEN COULD BE ON THE TRANSFER OF THE WRECK OR THE, LIKE, BE USED AS AN OFFSET AND ALMOST ACT AS THAT PERSONAL HEDGE AGAINST THE UTILITY PRICES THAT THEY'RE FACING.

HMM.

ALL RIGHT.

SO TO YOUR FINAL QUESTIONS THEN AT THE END.

SO I'M SUPPORTIVE OF EXPLORING THE PPAS AND I AM, UH, SUPPORTIVE OF EXPANDING, EXAMINING THE, THE POTENTIAL EXPANSION TO COMMUNITY SCALE.

I MEAN, WHY WOULDN'T WE? SO THANK YOU.

THANK YOU, MAYOR VICE, MAYOR ROSE, COULD YOU GIVE AN EXAMPLE OF A SHORT TERM OPPORTUNITY THAT WE WOULD BE ABLE TO TAKE ADVANTAGE OF IF WE ENTERED INTO AN AGREEMENT SHORT TERM, UH, FOR, FOR VIRTUAL POWER PURCHASE AGREEMENTS, GENERALLY? THERE, THERE, THERE WOULD BE A LONGER TERM, UH, COMMITMENT.

I DON'T KNOW IF, BUT I MEAN, IN THE SHORT TERM, WHAT WOULD BE THE FIRST PROJECT THAT WE WOULD ENTER INTO FOR, FOR THE, FOR A VIRTUAL POWER PURCHASE AGREEMENT OR OUTSIDE? UH, OUTSIDE OF THAT, MY, MY APOLOGIES, I'M NOT, NOT CLEAR HERE.

WELL, THE, THE SECOND BULLET, WOULD COUNCIL LIKE TO PURSUE ENERGY BEYOND MUNICIPAL CONSUMPTION AND EXPAND TO A COMMUNITY SCALE? SO FOR, FOR THAT ONE, UH, FOR THE ASPECT, UH, FOR A COMMUNITY BASED, UH, COMPONENT TO IT, UH, SHORT TERM, UH, ONES WOULD BE TRYING TO CONTINUE, UH, SOME OF OUR PURCHASING CO-OPS WITH SOLAR, BUT THEN TRYING TO BRING IN, UH, SOME SORT OF EITHER IT'S, UH, INCENTIVE PROGRAM TO BE, TO TRY TO FILL THE GAP OF WHAT'S BEEN LOST, UH, AT THE FEDERAL LEVEL WITH THAT TO, TO STILL ENCOURAGE FOLKS TO BRING THAT ON.

I'D SAY IT'D BE A MORE OF A SHORT TERM, UH, COMPONENT FOR US TO LOOK AT.

CAN I SEE IF I CAN UNDERSTAND YOUR QUESTION, ? MM-HMM .

ARE YOU ASKING, LIKE THE, THE SHORT TERM PROJECT, ARE YOU ASKING LIKE, OH, THERE'S A 20 MEGAWATT SOLAR FARM THAT MIGHT GO IN, GO ONLINE IN SOMEWHERE IN KANSAS LIKE THAT? IS THAT LIKE AN EXAMPLE OF WHAT YOU'RE ASKING OR, YEAH.

THE ONE WITH THE LEAST AMOUNT OF, UH, ENGINEERING EXPERIENCE UP HERE.

DOES THAT, THAT HELP? GOTCHA.

UM, YEAH.

MY, MY APOLOGIES, UH, THE, FOR MOST OF THESE AGREEMENTS, UH, THE, THE, THE TIMELINE FORM IS, IS GONNA TAKE ABOUT TWO YEARS FOR 'EM.

NONE OF 'EM ARE QUITE, UH, LIKE AT THE READY TO GO OR ALREADY BUILT.

UH, MOST OF THE ONES THAT WE'D BE LOOKING AT, UM, IF NOT ALL OF 'EM, WOULD BE MORE IN THAT TWO OR THREE YEAR TIME HORIZON.

IS THERE SOMETHING THAT YOU CAN, CAN SEE OUT THERE THAT WE WOULD WANNA PURSUE? UH, THAT IS WHAT WE'RE HOPEFUL, UH, THROUGH, THROUGH THE SOLICITATION, IS THAT, UH, THE PROJECTS THAT MIGHT BE A LITTLE BIT MORE READY COULD CLEARLY SAY LIKE, HEY, WE'RE, WE HAVE ALL OUR PERMITS IN PLACE, WE'RE ALL GOOD TO GO, AND MAYBE OUR TIMELINES A LITTLE FASTER.

I, I, AT THE MOMENT, I DON'T HAVE A, A GOOD SENSE TO SAY WE HAVE ONE THAT COULD BE OF READY, SAY, INTO NEXT YEAR OR SOMETHING OF THAT NATURE.

[00:45:01]

SO, UH, BUT I HAVE A FEW QUESTIONS FOR YOU ANYWAY.

UM, WHEN YOU TALK ABOUT THE SOLAR AND WIND FARMS, YOU'RE SPECIFICALLY NOT SAYING ANYWHERE HERE IN SEDONA, ANYWHERE IN ARIZONA, YOU TALK ABOUT OUTSIDE THE STATE FOR VIRTUAL POWER PURCHASE AGREEMENT.

YES.

RIGHT.

BUT WHAT ABOUT, AND WE TALK ABOUT IN THE FUTURE, DOWN THE ROAD, A LONG WAY, UH, THE, THE DELLS PROPERTY.

COULDN'T A SMALL SOLAR FARM BE USED THERE IN THE GRAND SCHEME OF THINGS? THEORETICALLY, YES.

AND HOW MANY ACRES WOULD BE NEEDED FOR A, A SOLAR FARM IN THAT LOCATION, AND WOULD IT REALLY EVEN 200 ACRES? I'M NOT SAYING I'M SUPPORTING 200 ACRES OF A SOLAR FARM, BUT I'M JUST SAYING FROM MY UNDERSTANDING TO THE PEOPLE WATCHING ON TV, JUST WANNA UNDERSTAND HOW BIG ARE THESE SOLAR FARMS? GREAT QUESTION.

UH, SOME OF THE SOLAR FARMS, UH, CAN BE MASSIVE.

UH, UM, THERE'S A 200 MEGAWATT SOLAR FARM THAT, UH, OPENED UP IN, UH, BELL COUNTY, TEXAS, UH, THAT, IF I REMEMBER, I FEEL LIKE IT'S OVER A HUNDRED FOOTBALL FIELDS, UH, KIND OF IN SIZE.

UH, SO IT, IT WOULD REALLY DEPEND ON THE, THE SCALE AND SIZE TO IT.

WHAT I WOULD CAUTION IS THAT IF WE DECIDED TO BUILD A, A SOLAR FARM, SAY AT THE DELLS THAT WAS EXPAND, EXPANDED BEYOND, UM, THE CONSUMPTIONS THAT WAS EXPECTED AT THAT SITE, UH, YOU WOULD NEED APSS, UH, AGREEMENT TO BE ABLE TO OFFTAKE THAT ENERGY, UH, IN OUR REGULATED MARKET.

AND I DON'T KNOW IF THIS PLAYS INTO IT OR NOT.

WHAT I KNOW A SOLAR FARM, I KNOW MY UNDERSTANDING OF A SOLAR FARM, WHICH IS VERY SIMILAR TO WHAT WE HAVE AT THE HIGH SCHOOL, IS A SOLAR FARM OF SOME SORT.

RIGHT? BUT WHAT IF THERE'S A DEVELOPMENT ULTIMATELY BUILT WAY DOWN THE ROAD AND THE HOMES IN THE ROOFTOPS ARE PART OF A SOLAR FARM? WOULD THAT ANY BE ANYWHERE NEAR ENOUGH OF A, OF AN ARRAY OR WE'RE LOOKING WAY, WAY FOR TO, TO, TO POWER THAT AREA, IS WHAT I'M TALKING ABOUT FOR, TO POWER THAT DISTINCT AREA? UM, GENERALLY THE, MY MY BA MY BASE ESTIMATE AT THIS MOMENT WOULD, THAT YOU COULD POWER THE MAJORITY OF IT THROUGH ONSITE SOLAR, UH, FOR, FOR NEW BUILDS AT THAT LOCATION.

JUST WANTED TO KNOW MM-HMM .

AND THEN WHAT IS THE LATEST THOUGHT PROCESS OF WIND FARMS? WE HEAR SO MANY, YOU KNOW, COMPLAINTS ABOUT, OH, IT'S KILLING BIRDS, IT'S KILLING WHATEVER.

ARE THEY VIABLE? ARE THEY STILL GOING UP? ARE THEY STILL COMPLAINTS? ARE THEY JUST COMPLAINTS FROM PEOPLE WHO, WHO JUST WANNA COMPLAIN? UH, GREAT.

UH, GREAT QUESTION, MAYOR.

UH, FOR, FOR WIND FARMS, UH, PART OF IT IS DISTINCTLY LIKE GEOGRAPHICALLY, WHERE CAN YOU ACTUALLY S SOURCE 'EM THAT GIVES YOU ENOUGH WIND TO, TO MAKE 'EM WORK? AND I'M NOT SAYING THE DELLS.

YEAH.

UH, SO , UH, FOR, FOR ARIZONA, NORMALLY WIND FARMS AREN'T, AREN'T THE BEST OPTION, UH, FOR US AROUND HERE A LITTLE BIT MORE IN NORTHERN ARIZONA, YOU GOT SOME SPOTS THAT, THAT DO PRETTY WELL.

UH, GEOGRAPHICALLY WE WOULDN'T SEE THEM A LOT IN THIS AREA.

UM, THEY ARE, THEY ARE DEFINITELY A VIABLE OPTION.

THE, I THINK, UH, WHERE SOME OF THE NOTION IS OF LIKE, THEY KILL BIRDS IN THE, LIKE, WAS THAT SOME OF THEIR, UH, EARLIER, UH, UM, UH, WINDMILL, UH, DESIGNS HAD KIND OF LIKE TERRACES OR LIKE CROSS MEMBERS GOING UP TO THE, THE, THE PROPELLERS AND THE TURBINES.

UH, AND THOSE, UH, EARLY DESIGNS HAD IT TO WHERE YOU HAD BIRDS HAD, UH, A PERCH TO BE ON.

AND SO THEN ONCE THEY'RE OUT THAT PERCH, THEY HAD MORE OF A TENDENCY TO GET HIT, UH, BY THE, THE TURBINES THEMSELVES.

THE NEWER DESIGNS HAVE MITIGATED THAT, UH, TO A, UM, AS, AS TO AN EXTENT.

UH, AND THERE THERE'S, UH, DESIGN ELEMENTS THAT ARE GOING INTO EVEN BLADELESS, UH, WIND TURBINES.

UH, GENERALLY THOSE ARE A LITTLE BIT SMALLER SCALE, BUT THERE, THERE IS RESEARCH AND DESIGN THAT, UH, ARE, IS GOING INTO THOSE ASPECTS OF IT.

UM, FROM MY UNDERSTANDING REALLY FOR, FOR LIKE BIRDS AND PETS OR FOR BIRDS IN PARTICULAR? NO .

UH, OR THE PETS, OR SORRY, BIRDS IN PARTICULAR.

LIKE THE NUMBER ONE KILLER OF, OF, OF THOSE IS, IS DOMESTIC CATS.

UH, 'CAUSE IF YOU HAVE HAVE A CAT THAT'S FLOATING AROUND OUTSIDE AND IT'S NOT INSIDE, THEY'RE, THEY'RE TAKING OUT BIRDS LEFT AND RIGHT AND LIKE, THAT'S FROM A, A, A KILLER OF BIRDS' PERSPECTIVE.

I'D SAY YOUR DOMESTIC CATS ARE BE ONE TO LOOK AT.

THAT'S JUST ME PERSONALLY.

ALRIGHT.

DON'T WANT ANY, ANYONE HAS A CAT LOVE.

UH, GOT TWO OF THEM HERE.

, ANY OTHER QUESTIONS BEFORE WE GO TO COMMENTS? AND THEN, UH, YES, I HAVE A QUESTION.

MY MIND ABOUT HOW DID THIS WORK? HOW DO WE, HOW DO WE MAKE IT FUNCTION? UM, AND, UH, I KNOW MY, MY, MY COLLEAGUES UP AT NAU ARE IN THE SAME BOAT, AND SO THEY WERE, UH, KIND OF PURSUING THIS OPTION FIRST, BUT WE ROUTINELY HAVE, UH, DIALOGUE ACROSS, UH, ACROSS THE MUNICIPALITIES AND THE LIKE, UH, SO THEY BROUGHT IT TO US, BUT, UH, IT'S BEEN A THOUGHT PROCESS FOR US ON LIKE, HOW, HOW DOES IT, HOW COULD IT FUNCTION HERE? OKAY.

DID NAU BRING THIS TO YOU OR DID YOU KNOW ABOUT THIS AND GO TO NAU, LIKE THEY'RE THE LEAD ON THIS.

SO HOW DID THAT COME ABOUT? UH, SO, UH, EVER SINCE GRAD SCHOOL, IT HAS BEEN IN

[00:50:01]

UH, DEREK, ANYTHING FINAL? NO.

ALRIGHT.

THIS IS FOR INFORMATION DISCUSSION.

UH, POSSIBLE DIRECTION ONLY.

UH, YOU, YOU'RE LOOKING FOR DIRECTION AS FAR AS TO MOVE FORWARD MM-HMM .

SO I WOULD SUPPORT YOU MOVING FORWARD.

BRIAN, YOU ALREADY GAVE YOUR, I ALREADY GAVE MY 2 CENTS.

UH, VICE MAYOR, I'M IN, I'M IN SUPPORT.

KATHY? YEAH, I MEAN, I, THERE'S, UH, NO DIRECT DOLLAR COST TO THE CITY YET, UNTIL WE GET INTO SOMETHING, WHICH WE MAY OR MAY NOT, BUT THEY'RE DOING THE WORK TO, TO LOOK AT THAT AND SEE IF THERE ARE ANY SUITABLE VENDORS.

I THINK THIS IS, YOU KNOW, A WIN-WIN.

SO YEAH, I SUPPORT THIS COMPLETELY.

DEREK, DID I, OKAY.

I THOUGHT THERE WAS SOME FINANCIAL, IF IT PROCEEDS THERE WOULD BE A RESPONSIBILITY TOWARD LEGAL COST.

NO, I'M TALKING ABOUT JUST TO DO THIS STUDY.

UH, WE TALKED ABOUT THAT YESTERDAY.

A COUPLE THOUSAND DOLLARS IS REALLY NEGLIGIBLE.

YEAH.

FOR, FOR THE SOLICITATION AND THE RFP PROCESS.

UH, WE'RE NOT ANTICIPATING ANY COSTS.

UH, IT WOULD BE AN ASPECT OF A PROJECT WAS SELECTED AND WE NEEDED TO NEGOTIATE IT THEN COST ASSOCIATED.

THEN DO YOU HAVE YOUR DIRECTION? YEP.

UH, AND I JUST WANNA TOUCH BRIEFLY ON LOOKING AHEAD PART I, WE WILL BRING BACK THE, THE FINAL IGA TO YOU FOR, UH, CONSIDERATION.

UH, AND IT WOULD, UH, THE IGA WOULD LOOK TO AUTHORIZE NAU TO PROCEED FURTHER.

UH, AND THEN JUST WANTED TO HIGHLIGHT AGAIN THAT, WE'LL, WE'LL BE BACK BEFORE YOU, BEFORE THE END OF THE YEAR TO GO INTO A DEEPER DIVE ON THE, UH, COMMUNITY AND MUNICIPAL EMISSIONS.

GREAT.

ANDY, ANNETTE, ANYTHING ON THIS BEFORE WE MOVE ON TO THE NEXT? NO.

POSSIBLE ACTION REGARDING IDEAS OF FUTURE MEETING AND AGENDA ITEMS. WE HAVE ANYTHING? OKAY.

ITEM B, DISCUSSION,

[3.b. Discussion/possible action regarding ideas for future meetings/agenda items.]

HEARING NOTHING, THIS MEETING

[5. ADJOURNMENT]

IS ADJOURNED A RECORD.