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Elk River <br />Municipal Utilities <br />13069 Orono Parkway • P.O. Box 430 <br />Elk River, MN 55330-0430 <br />Dec 4, 2008 <br />To: Elk River Municipal Utility Commission <br />Jerry Takle <br />John Dietz <br />Jerry Gumphrey <br />From: Vance Zehringer <br />Subject: Dec 4 Meeting Results, United Health Group Management Team <br />Phone: 763.441.2020 <br />Fax: 763.441.8099 <br />The subject meeting was initiated by yours truly to alert UHG about load spikes created <br />by integrity testing they initiated and the impact those tests had on their power bill and <br />possibly ERMU's billing peaks. They were more than eager to meet and discuss that and <br />learn about other things they can do to reduce their monthly bills. <br />The one month in question was July 2008. Seven megawatt spikes during the last week <br />of that month were a result of testing they were conducting to determine system integrity. <br />Those tests added $104,000 to their July bill for the additional demand they placed on the <br />system. They missed ERMU's 7 PM July 28 billing peak by two hours, because we <br />asked them to run their generators so we dodged a huge penalty on our monthly power <br />bill from GRE. <br />The other month in question was November 2008. A single 2 megawatt spike occurred <br />on Nov 20 at 10 AM for 1.5 hours during an otherwise level monthly load. That 2 <br />megawatt system integrity test added another $21,000 to their November bill for the <br />additional demand they placed on our system. Our billing peak was also on Nov 20, but <br />at 7 PM, so we dodged a significant penalty on our monthly power bill from GRE. <br />The point is, if either of these tests had occurred a few hours earlier or later, ERMU <br />would have incurred significant additional demand casts from GRE. <br />UHG is willing to shift any additional testing of a like nature to off-peak hours and even <br />give us advance warning prior to testing. The question is what's in it for them? <br />We recommend ignoring any integrity testing spikes created during the off-peak hours <br />(between midnight and 6 AM) for billing purposes. In order to not set a precedent, we <br />would make this offer to any new or expanding lazge commercial loads exceeding one <br />megawatt if testing occurs only during off-peak hours, if it is for system integrity testing <br />purposes only, if they give us a 24 hour "heads up", and only during that duration of time <br />when they are ramping up to their full anticipated load. <br />