6.1a ERMUSR 03-12-2024 - Laserfiche WebLink

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ALLEVIATE THE SUPPLY CHAIN CRISIS Critical infrastructure components, particularly distribution transformers, are not readily available. This has created an unprecedented supply chain crisis for public power utilities. As many as one in five public power infrastructure projects is delayed or even cancelled due to a lack of component parts. In Minnesota, as in other public power states, it is common for lead times on delivery of distribution transformers to stretch from two to five years. At the same time, proposed federal rules mandating increased efficiency for transformers threaten even longer delays. Lead times for other parts have also increased dramatically. This supply chain crisis threatens not only the ability to continue the move towards more renewable and carbon - free power, but reliability of both local power and the electric grid as a whole. It slows down recovery time from storms and other natural disasters, even affecting mutual aid efforts when one utility hesitates to provide resources to another over a justified fear the utility may need the items for itself. MMUA asks Congress to: • Provide, as appropriated by the Senate, $1.2 billion for the Department of Energy's Office of Electricity and Grid Development Office to immediately begin addressing this crisis • Delay new efficiency standards for distribution transformers • Sign onto and pass H.R. 7171/S.3627 known as the "Distribution Transformer Efficiency and Supply Chain Reliability Act" MODERNIZE PUBLIC FINANCE TOOLS As part of the Inflation Reduction Act (IRA), Congress took a critical step towards modernizing public finance tools when it authorized or extended several tax credits and then approved correlated direct payment incentives for local governments. However, Congress failed to reauthorize advance refunding of bonds, a tool that could save millions of dollars in financing public power projects. Congress also failed to increase the threshold under which a lender remains a small issuer, and it did not permanently exempt Build America Bonds or the funds for grants to public power providers under the IRA and the Infrastructure Investment and Jobs Act (IIJA) from sequestration and rescission. MMUA asks Congress to: • Restore advance refund bonds • Increase from $10 million to $30 million the threshold under which a lender remains a small issuer • Exempt public finance bonds and grant funding from sequestration and rescission AAAiiiA Minnesota Municipal Utilities Association W