Junction, TX GM Meeting

The Junction General Manager’s was well attended (or much better than in Georgetown) by some 15 or so members, another ten employees and two candidates, David Hall and myself. I purchased a current copy of the Junction Eagle while driving into town and found two references to the forum, one on the front page and the other was my letter to the editor asking members to attend to learn more about the opportunities facing PEC.

The meeting format was very similar to the other GM meetings that I have attended. It was another opportunity to meet the local district manager and his staff followed by Juan’s presentation of recent key events and his plan for taking us into the future. Of course it ended with a Q&A session. Since Juan’s message was so similar, I won’t bore you with those notes but I did want to present what I learned from his answers to some of my questions.

First we discussed the election and the voting practice of one meter – one vote instead of what most of us assumed would be the one member – one vote policy as stated in IRS 501 (c) (12). I specifically was interested in if he was an advocate of the one member – one vote policy. He was non-committal in his response in that he would answer only by saying that he felt it should be looked at by the board. I replied that it was very apparent that the board takes his comments very seriously and that his stance on the issue is important as he can sway the board with a word. He once again was unwilling to take a side indicating to me that from a business standpoint he would not like to lose the revenue that is paid by the owners of multiple meters. My understanding is that each meter has its own associated member fee. If PEC were to change the policy, there is every expectation that the meter v. membership dues situation would have to change as well. This should definitely be looked at by the board at their first opportunity.

Next up was the LCRA contract status. As recently as two weeks ago, Juan stated that he hoped to present to the board the LCRA contract for review and approval by the annual meeting. When I asked if he was still confident that the contract was progressing to a June closure, he replied that they had hit some snags in the negotiations. PEC is aligned with the Wholesale Power Alliance and it appears that this alliance is slowing the contract proceedings down. Juan did not appear happy with all of the alliance’s objectives prompting me to ask why we would continue to be a part of something that may not be working in our best interests. Juan answered that they wanted to continue with trying to work through it with them for a while longer. A while longer seemed to be into late summer, early fall. My statement would have to be that any alliances that don’t make our (PEC) considerations a top priority is a bad alliance.

We discussed the Navigant report briefly. I asked Juan if PEC would consider a continuation of the Member Comment/Vote page that is on the website now to allow the members to express with a vote or comment their feelings of satisfaction or dissatisfaction with how the company was being run. He answered that PEC is indeed going to set this up on their website but that it may not be for voting purposes—only for comments. I would like to see it expanded to include possibly an annual “Say on Pay” opportunity. This is something else for the new board to consider following the elections.

Juan has been very complimentary of the renewable energy programs offered by Austin Energy. I asked him how many of these they were bringing to us at PEC. He responded that AE is positioned differently than PEC in that they are profit driven whereas PEC is not. He reiterated that the cost of renewables is more expensive than traditional. I responded that it is obvious that there are some members more than willing to accept the additional cost. He told a story about AE and the quick sale of alternative energies that just confirmed my statement regarding the market for renewable energy. I also asked if we could bring more balance to the power supply from LCRA and AEP to include more wind energy than what we are getting now from AEP. He was non-committal on this point as well. When I asked about rebates he once again said that AE was in a better position than PEC to offer rebates due to their different mission objectives but that they could explore it with LCRA. I thought this was a good idea so I asked if that was part of the on-going negotiations at this time. He replied that it wasn’t. Overall he did not come across as very encouraging regarding renewables in this meeting. He wanted to emphasize conservation. Conservation is absolutely a great subject but I personally don’t think it’s wise to discount the renewables as easily as he did last night. Too many of the members feel very strongly about it and we are uniquely positioned at this time to make a move in providing more clean power. Why wait? Why not make the move? As I said, it was disappointing discussion.

There was significant discussion about capital credits as well. But it was more to do with the 5 year payouts of the $23 million and the future plans regarding the retirement of the credits and the continued infrastructure maintenance and development. Nothing new here that wasn’t already placed on the website.

As a note, Juan said that although the website hasn’t been updated and that the customer service department hasn't been briefed on it, PEC does buy power back from at least two member-suppliers of wind energy. He said they paid full price. So there is a little hope for the interested parties out there who have indicated that they want to consider placing the turbines on their properties.