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City Council - 06/13/2023 - Workshop APPROVED MINUTES CITY COUNCIL WORKSHOP & OPEN PODIUM TUESDAY, JUNE 13, 2023 CITY CENTER 5:00 – 6:25 PM, HERITAGE ROOMS 6:30 – 7:00 PM, COUNCIL CHAMBER CITY COUNCIL: Mayor Ron Case, Council Members Kathy Nelson, Mark Freiberg, PG Narayanan, and Lisa Toomey CITY STAFF: City Manager Rick Getschow, Police Chief Matt Sackett, Fire Chief Scott Gerber, Public Works Director Robert Ellis, Community Development Director Julie Klima, Parks and Recreation Director Jay Lotthammer, Administrative Services/HR Director Alecia Rose, Communications Manager Joyce Lorenz, City Attorney Maggie Neuville, and Recorder Sara Aschenbeck Workshop - Heritage Rooms I and II (5:30) A. SUSTAINABILITY UPDATE Jennifer Fierce, Sustainability Coordinator, began by presenting updates on the recent Climate Action Plan, legislative session, sustainable building standard, and general programming updates. Fierce stated the most recent Climate Action Plan data is from 2021 due to a lag in utility reporting. 2021 emissions were slightly higher than 2020 due to the pandemic. The City’s trending emissions reduction is on track to be carbon free by 2050. The median emissions reduction across the State of Minnesota is 32 percent since 2007. The City has reduced emissions by 36 percent, slightly ahead of the State median. Narayanan inquired how the emissions data was obtained. Fierce stated building energy use information was provided by CenterPoint and Excel. Ellis stated vehicle miles traveled was provided by MnDOT. Fierce added there is a national standard so each entity is tracking information the same way. Nelson asked if cities were ranked by emission output. Fierce responded most cities are likely near the median reduction of 32 percent, but no specific ranking is provided. Freiberg inquired if the City’s baseline emission, in tonnes of carbon dioxide, was measured by weight or volume. Ellis responded the measurement information was not readily available but he would confirm the measurement unit with the councilmembers after the workshop. Case stated a large volume of the City’s travel emissions are from vehicles on I-494. Many of these vehicles are passing through the City and are not owned by Eden Prairie residents. Nelson added T.H. 62 East similarly has a large volume of traffic from non-Eden Prairie residents. Fierce noted when the City began tracking emissions in 2007, electricity counted for 72 percent of total energy related emissions. In 2021, total energy related emissions were 51 percent from City Council Workshop Minutes June 13, 2023 Page 2 electricity and 49 percent from natural gas due to the grid getting cleaner over time. As the City works toward the State’s carbon neutral by 2040 goal, natural gas will become a higher emitter than electricity. Case inquired why natural gas was going to be the larger of the two energy related emitters if we are moving toward an electric grid. Fierce clarified as the City moves toward cleaner electric energy, which has fewer emissions, the remaining natural gas usage will make up a larger percent of overall emissions. Fierce stated residential gas usage is consistent and driven by weather. Residential electricity usage has decreased 18 percent as residents install LED lighting and more efficient appliances. Median comparable cities had an 11 percent reduction in residential energy usage. Commercial and industrial electricity usage has decreased 20 percent, which is in line with median comparable cities across the State. The City’s emissions are 61 percent from energy, 37 percent from travel, and two percent from waste. Fierce stated of the City’s planned energy-related emission reductions, 46 percent will be from commercial and industrial energy efficiency, 24 percent will be from the grid mix becoming cleaner over time as energy sources such as electricity are used in lieu of natural gas, 14 percent will be from fuel switching, 12 percent will be from residential energy efficiency, and four percent will be from other sources. Case noted the City can educate residential and commercial users as we do not directly impact the grid mix. The City could also incentivize fuel switching for appliances. Fierce stated the City’s travel emissions were higher in 2021 than 2020 due to the pandemic but are still trending lower than pre-pandemic levels. Narayanan inquired how many cars are owned by Eden Prairie residents. Fierce responded the State tracks vehicle registration. Four percent of vehicles registered in the City are electric. Nelson inquired if hybrids were included in that percentage. Fierce confirmed hybrids were not included. Fierce noted the 2023 legislative session was historic for climate and clean energy policies approved and the amount of funding allotted. Policy changes include 100 percent carbon free electricity in the State by 2040 and changes to the size and subscription model of community solar gardens. Case inquired if there is opportunity to create more community solar gardens in the City. Getschow stated it’s possible but very time intensive. Narayanan inquired if there is any unutilized swamp area the City could build a solar garden on. Ellis responded it would not be a viable solution due to reduced environmental quality of the wetlands and intrusion on wildlife. Fierce noted the State created a $5 million grant program to assist cities in drafting and implementing climate action plans. All HOA bans on rooftop solar were also nullified. Nelson stated the City needs to notify HOAs in town of the new policy. City Council Workshop Minutes June 13, 2023 Page 3 Fierce detailed the new statewide commercial building energy benchmarking policy. All commercial buildings greater than 100 thousand square feet must benchmark and disclose annual energy use by 2025. Fierce stated there are new energy related grants and rebates available for residents including an additional $2,500 rebate for new electric vehicles (EVs) and $6.5 million available for residential electric panel upgrades. Narayanan inquired if there was any money made available for electrical charging stations. Fierce responded there is federal money available, but not any state funding. Fierce noted the City adopts a commercial energy code every six years. By 2036 the energy code must achieve an 80 percent reduction in annual net energy consumption from the 2005 baseline. EV standards will be required in the new code. Fierce discussed the sustainable building standard, which establishes sustainability criteria for new building projects that receive financial or zoning incentives from the City. One portion of the standard is third-party green building rating systems. There are different options for building rating systems, with LEED being the most common. The Council had previously discussed the additional costs of building to a third-party rating system. The added cost can be between two and nine percent depending on the rating system. Narayanan inquired if a developer in Eden Prairie would have a ten percent cost increase by building to a third-party rating system. Ellis stated the City is proposing to utilize the LEED Silver certification, which would be a cost increase of between two and two and a half percent. Fierce added there are other building rating systems available to use, such as the Department of Energy (DOE) zero energy ready home program and the passive house design. There is one house in the City built to the DOE zero energy ready that spent ten dollars per month on utilities in 2019. Narayanan inquired if the price of LEED certified materials will decrease as more communities adopt building codes using LEED certifications resulting in higher demand. Case responded the cost of using LEED certified materials will be higher regardless of demand due to the technological advances. Fierce noted new single-family houses would likely pick a third-party green building rating system other than LEED as LEED is mostly utilized by commercial buildings. For example, building a single-family home to the DOE zero energy ready standard costs $8,000 -$10,000, but is eligible for a $5,000 tax credit. Fierce discussed the benefits of using a sustainable building standard. LEED certified buildings have higher rents and sales prices in both commercial properties and multifamily properties as compared to non-LEED certified buildings. Utility and operating costs for a LEED certified building are lower than a non-LEED certified building. City Council Workshop Minutes June 13, 2023 Page 4 Fierce then provided an overview of the second portion of the sustainable building standard, universal requirements. These are priorities chosen by the City. The City’s universal requirements are predicted greenhouse gas emissions, EV charging capability, and the renewable energy standard. These are similar to comparable metro cities that have a sustainable building policy. Drivers moving to EVs account for most of the reduction in travel emissions. At a minimum, new buildings will have to build to a solar-ready standard. Nelson asked if the sustainable building policy applies to tonight’s City Council Public Hearings. Getschow responded the City has not adopted this policy yet, but Council will likely vote on the policy in the near future. Currently, solar readiness, EV charging stations, and energy efficiency are discussed during developer negotiations with City staff. Energy efficiency has historically received the most disagreement from developers, but the State is now governing that component. Case stated the City must remain flexible in the face of fast changing technology. The City may have an all-electric fleet by 2030 if technology evolves quickly. While it is helpful to have EV charging stations in public spaces, it is more important to have charging stations in residences. Fierce responded the City requests more EV charging stations in residential locations than in commercial locations. Fierce summarized the Sustainability Commissions’ recent programming items including the Electrify Everything MN campaign and workshops, the compost giveaway and garden tool swap on Arbor day, a pollinator planting webinar, and the upcoming EV showcase at Staring Lake Park on September 12. The City was recently recognized as a GreenStep Step four and five city. The City is also at the silver level of the EV Smart Certification Process, which is focused on EV readiness in fleets and in the community. Case inquired if local car dealerships could bring a model EV for the upcoming EV showcase. The City and car dealerships could summarize information on final car prices after tax credits and rebates. Fierce responded dealerships in the City and surrounding cities were invited to the previous EV showcase, but only one attended as the remaining dealerships did not have available EV cars at the time. Finally, Fierce discussed the upcoming Energy Efficiency and Community Block Grant federal funds of $130,000 for electrification, programming, and rebates. The councilmembers thanked Fierce for her presentation. Open Podium - Council Chamber (6:30) I. OPEN PODIUM III. ADJOURNMENT