Board Meeting Minutes

VERMONT ELECTRIC COOPERATIVE, INC.

REGULAR MEETING OF THE BOARD OF DIRECTORS

NOVEMBER 27, 2018

APPROVED MINUTES

CALL TO ORDER – AGENDA ITEM #1

President Dan Carswell called the meeting to order at 12:01 p.m. in the Robert P. Northrop Boardroom at VEC’s office in Johnson, Vermont.  Present were Directors Ken Hoeppner, Carol Maroni (Second Vice President), Mark Woodward (Secretary), George Lague (First Vice President), John Ward (Treasurer), Don Worth, Rich Westman, Paul Lambert, and Rich Goggin.  Also present from VEC was CEO Rebecca Towne, General Counsel Vickie Brown, Chief Financial Officer Mike Bursell, Safety & Security Manager John Varney, Manager of Government Affairs and Member Relations Andrea Cohen, and Chief Operating Officer Peter Rossi.

MEMBER INPUT – AGENDA ITEM #2

No members were present.

SAFETY DRILL – AGENDA ITEM #3

Towne described an accident that occurred when she was stacking firewood that resulted in two broken toes.  This was preventable with proper PPE (boots) or placing the carrier on the ground.  Carswell shared that his company’s email was hacked and was used to send attachments containing viruses to customers.

APPROVAL OF MINUTES – AGENDA ITEM #4

President Carswell asked if there were any additions or corrections to the minutes of the regular monthly Board of Directors meeting held on October 30, 2018. 

Hoeppner moved and Goggin seconded:

That the minutes of the regular monthly Board of Directors meeting held on October 30, 2018 be approved.

The following changes were suggested and agreed to: 

Bursell began the discussion by noting that there is a comparison in the packet of the proposed 2019 budget against three different scenarios: (1) the 2018 budget that the Board had previously approved, (2) the Company’s actual spending during the “test year” period from July 1, 2017 to June 30, 2018, and (3) the 2018 2019 budget projections that staff had provided in May, 2018.  He took the Board through the changes between the 2019 budget and the three other points of reference; most of which the changes were not material.

The minutes were approved, as amended, by unanimous vote.

APPROVE 2019 CAPITAL BUDGET  – AGENDA ITEM #6

            This agenda item was moved forward.  Rossi introduced Cyril Brunner, VEC’s Manager of Systems Engineering to present on this topic.  Brunner began with a summary of major capital projects that were completed in 2018.  There were numerous questions about what has driven the need for some of these projects.  

            He presented a high level summary of the proposed 2019 capital budget and then broke it down by major category of projects, i.e. distribution, transmission, substation, storage, facilities, fleet, IT, and metering.  He entertained numerous questions from the Board throughout the presentation. 

            Ward moved and Westman seconded to adopt the $11 million 2019 capital budget as presented in the Board packet.  

            The motion passed by unanimous vote.

DISCUSSION OF JERICHO BATTERY STORAGE DEALS  – AGENDA ITEM #5

            Bursell updated the Board as to the status of this deal, which is stalled at this point.  The latest offer from the developer included conditions that we could not agree to.  Management has pushed back but we have not been able to come to a resolution.  Management is considering other battery project developers at this time and may be a position to recommend a deal in the future.   

            There was a discussion of whether battery storage may be a solution being considered for the constraints within the Sheffield-Highgate export interface.  

BOARD PLANNING FOR 2019 – AGENDA ITEM #7

Towne explained that she included in the packet a month-by-month summary of Board and Committee meetings and topics that were addressed for 2018, along with the notes of the Governance Training.  The Board then undertook a review of the calendar with the goal of creating a new calendar of meetings for 2019.

It was noted that the December meeting generally falls during Christmas week, and there was a discussion about what flexibility there is to move that meeting to be more convenient.  There was a consensus to move the meeting to December 20 this year.   

There was a break in the meeting at 1:35 p.m.

The meeting resumed at 1:55 p.m.

Carswell noted that he would like a two-page annual calendar included in the Board packet every month, so that as items come up they can be included in the calendar.

There was a discussion of whether the review of Board policies, which is required by Policy B.1 should be done by a task force rather than at Governance Committee meeting attended by all Board members.  A director noted that such an approach worked well in developing the recently enacted anti-bullying policy. 

A director asked whether there were bylaw changes to be proposed this year.  Bursell said he had one change to propose to limit a restriction as to how much patronage capital can be retired.

There was further discussion about how to use committees successfully.  Towne noted that she has seen other Boards allow committees to do their work as committees but then share all committee materials with the full Board for transparency.  Several directors noted the history and reasons for moving to committee meetings where all Board members attend.  A director asked whether we need the committees that we currently have or whether other committees may be needed. 

There was an extensive discussion of how the Board should use meeting time to focus on addressing strategic issues and educating the Board as to what is coming in the electric industry.

A director raised the issue as to the time commitment that should be expected of Board members, particularly directors who also have full time jobs.  There was further discussion of how Board meetings can be more efficient, more strategic and less focused on operations.   There were a number of suggestions as to how to accomplish this, including:

  • Providing operations material on a quarterly basis rather than monthly.
  • Use the RE magazine as the starting point for strategic discussions.
  • Establish a task force to focus on the Board packet with the goal to move the meetings to a more strategic plane.
  • Use different dashboards for strategic vs. operational metrics.

Towne suggested that management take an initial shot at revamping the Board packet, based on the feedback, and then run it by the Board for further discussion.

Towne also noted that she had included in the packet a list of possible areas of focus over the next year as input to developing key focus areas for 2020.  A discussion ensued and the following topics of interest were identified:

  • Battery storage potential
  • Load control opportunities
  • Customer choice and control
  • Electric Vehicles
  • SHEI issues

Rather than take Board time to fill in the 2019 calendar, it was agreed that management will do an initial cut at the calendar for further review by the Board.

It was also agreed that the proper committee structure will be subject to further review going forward.   

MANAGERS’ REPORTS – AGENDA ITEM #8

There was a question about using members’ generators for demand response/peak shaving.  There was a concern that this use of a member’s generator is in conflict with the State’s Tier III goals.  Other directors noted that peak reduction has long been a goal of VEC and all utilities and this effort is consistent with that.  Discussion ensued as to the wisdom of this approach.  Bursell noted that it is still at the conceptual level.

There were further questions about details included in various managers’ reports.

COMMITTEE REPORTS – AGENDA ITEM #9

Ward moved and Maroni seconded to approve the minutes of the joint meeting of the Finance and Power Supply and Operations Committees.

ANY OTHER BUSINESS – AGENDA ITEM #10

There was no other business.

ADJOURN – AGENDA ITEM #11

Lague moved and Westman seconded:

That the meeting be adjourned.

The motion carried unanimously.

The meeting adjourned at approximately 4:00 p.m.