Agenda - Council - 02/08/2021 - Laserfiche WebLink

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sustainable for future residents. Those solutions need to keep in mind that essential residential water use is the highest preferred use of public water supplies. Finally, in cases where sound management of water resources will require substantial modifications in public water systems that were previously determined to be adequate, the state needs to be a partner in developing cost- effective solutions and in providing the technical and financial resources to make those changes to prevent communities from being economically uncompetitive. SD-65. Municipal Electric Utilities Issue: Municipal electric utilities provide essential community services to many Minnesota cities. The League of Minnesota Cities works closely with the Minnesota Municipal Utilities Association (MMUA) to identify issues of concern and to support their legislative and administrative efforts to address them. How those entities are regulated by the state, how their service territory is defined and amended, how their very limited customer base is protected, and how they are treated in relation to other types of electric utilities is important to them remaining affordable, efficient, and effective. Currently, the legislative proposals have been made to allow unregulated third -party electricity sales from generators directly to the customer, circumventing long- established consumer protections. In some cases, municipal utilities would be required to "wheel" energy from third parties across their power lines to retail customers in violation of the utility's exclusive service area rights. 57 Another way to arrange third -party sales is by selling electricity from solar panels or other generating equipment sited on a consumer's own property to retail customers, while maintaining ownership of those panels or equipment. The equipment owner would charge for electricity it provides, yet rely on the local utility to provide reliable service to the customer at all other times. While such arrangements may seem convenient to an unregulated third -party, they come at a significant cost to the utilities and subsequently, to the rate payers of that utility. Providing municipal reliable utility services comes with certain unavoidable expenses such as electric generation, power lines, poles, and substations. These types of fixed costs are on -going and should be equitably shared by the local customers. However, both current and previously proposed changes to state law would give third -party providers an advantage subsidized by the remaining rate payers and/or taxpayer. Response: The legislature should support and maintain the current regulatory compact, and recognize the value of the dependable services provided by municipal utilities, and the fact that municipal utilities are accountable directly to the citizens. Further, the legislature should reject giving third - party providers any advantage over municipal utilities, as well as any other effort to de -regulate utilities. Additionally, current state practice is for the Department of Commerce and Public Utility Commission to require payment of quarterly fees on municipal utilities to the Department of Commerce three quarters in advance. The state should bill for those fees only for the upcoming quarter.