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HomeMy WebLinkAbout2015 COS - Peak Hour Demand CommentsÇity ef Çe¡tra! Point, o_¡ego¡ CENTRAInt, oRe7502 pOINT C)rc:¿,ort Administration Department Chris Clayton, City Manager Deanna Casey, City Recorder Barb Robson, Human Resources Director August 18,20'1,5 Medford Water Commission Attention: Larry Rains 200 South Ivy Street Room 177 Medford, OR 97501 RE: 2015 Cost of Service Analysis Dear Mr. Rains, During the recent 2015 cost of service analysis workshop conducted on August 72th,2015,the Other Cities customer group was pleased to learn that Medford Water Commission has current technology in place to collect data on each customer city's peak hour demands/usage. Given that peak hour usage limits are, or will be, included in each city's water service agreement, this information is critical, not only in meeting the limits set in our water service agreements, but in avoiding rate charges/increases that are driven by peak hour demands. In reviewing this new data, the Other Cities customer group will begin strategizing to avoid peaking off the Medford Water Commission system. As these strategies are implemented, it will remain critical that the Medford Water Commission continue to share peak hour data on a timely basis so that individual customer cities can monitor progress and reevaluate peak hour minimization efforts as needed. Even though peak hour demands are the responsibility of each city, strictly limiting each city's system demands to a daily maximum amount during the summer period may not be the best operational strategy for the entire water system. Matching the Other Cities' summertime demands with off peak hour periods when water is actually being produced at the Duff WTP will reduce the stress on the entire water system. We welcome the opportunity to discuss overall operational strategies that benefit all parties as part ofthis process. As it relates to the 2015 cost of service analysis, we believe it would be inappropriate for the Medford Water Commission to include a peak hour rate charge component before the Other Cities customer group has had the opportunity to utilize the newly available information to avoid peak hour increases. A more reasonable approach would be to allow the customer cities a grace period to make system adjustments aimed at minimizing peak hour demands. If a peak hour charge remains appropriate after the proposed period, the Medford Water Commission should adjust rates accordingly. Additionally, it is likely that while peak demands will be minimized through new strategies, it is unrealistic to assume that these demands will be entirely eliminated. With this in mind, we would encourage the Medford Water Commission to continue the practice of including peak hour limits in our five-year water service agreements to recognize growth and reasonable safety and operational margins. In order to begin a timely review and the development of operational strategies, the Other Cities group asks that we receive continuous peaking data on each meter as soon as that can be arranged. We appreciate the opportunityto work collaborativelywith the Medford Water Commission on these matters. Thank you for your consideration of this important issue. Sincerely, C1"r2 Christopher S. Clayton City Manager cc: all "Other Cities"