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HomeMy WebLinkAboutPACKET Town Board Study Session 2012-05-08* Revised NOTE: The Town Board reserves the right to consider other appropriate items not available at the time the agenda was prepared. STUDY SESSION TOWN BOARD Tuesday, May 8, 2012 4:30 p.m. Rooms 202/203 170 MacGregor Ave. AGENDA 4:30 p.m. Fiber Optic Infrastructure. 5:15 p.m. Break for Dinner 5:20 p.m. PRPA Water Lease to Oil and Gas Industry. 6:30 p.m. Meeting Adjourn – Prepare for Board Meeting. Utilities Department Memo To: Honorable Mayor Pinkham Board of Trustees Interim Town Administrator Richardson From: Alan Fraundorf, Utilities Superintendent Date: May 8, 2012 RE: Fiber Optic Infrastructure Background: Several years ago the Town and the Platte River Power Authority (PRPA) installed a fiber optic network in Estes Park, along with fiber optic lines to Loveland. Since that time a portion of the fiber optic network has been in use. Overview Purpose The purpose of the study session is to provide education and a shared understanding of the network as it relates to future business development in Estes Park. Agenda • Introductions • Review Definitions and Notions • Review Estes Park and Regional Fiber Maps • Potential Next Steps • General Q&A Guest Speaker – Scott Rowley – Systems Maintenance Manager – Platte River Power Authority Attachments • Fiber Optics Notions – a document with definitions of fiber optic components and brief descriptions of companies/organizations involved around Estes Park. • Two Maps – one showing the Town/PRPA fiber optic ring in Estes Park; one showing the microwave and fiber system in the region. • Close-up pictures of fiber optic cable.  5/4/2012 20120508 TB Memo Fiber Edu ‐ attach 1   Fiber Optic Notions Dark Fiber – strands of fiber which are not in use (not lit). Splicing – an exact process of splicing (connecting) strands of fiber, typically performed in a “splicing location” or “splice point”. Fiber Ring – a geographical area in which there is a ring of fiber. The notion is that if the ring is cut, the signal can go back around the other direction and the signal remains good. Lateral – fiber cable which extends off of a ring, and is not in a ring by itself. If the lateral line is cut, the service for that line stops. PRPA – Platte River Power Authority – a non-profit organization owned by Estes Park, Ft. Collins, Longmont and Loveland. Estes Park has a seat on the Board. In addition to electric power services, PRPA owns a large fiber network in these cities and has dedicated, expert network/fiber staff. RMDAS – Rocky Mountain Data Availability Service – a local Estes Park internet business located on Woodstock. They have provided temporary wireless internet service to the Fairgrounds in the past and are interested in leasing a portion of the PRPA/EP fiber ring. Fiber Optic Cable – a cable which contains numerous “tubes” (or “buffer tubes”). Each tube holds several strands of fiber. Most of the PRPA/Town’s fiber optic cable around Estes Park contains 6 tubes, with 12 strands of fiber in each tube (giving 72 strands of fiber). This cable can be strung overhead on light poles or underground. “Tubes” are color coded (as well as the shield around each individual fibers). Frequently there is discussion concerning which tube contains which company’s fiber (e.g. “The Estes Park school district uses 4 strands in the blue buffer tube”). Fiber optic cable is used to carry internet and network data. Laterals off the ring vary in fiber count from 12 to 48 fibers. FRII – Front Range Internet, Inc. – a Ft. Collins company which is the Town’s Internet Service Provider (ISP). They are connected to the PRPA/EP fiber optic cable (through PRPA equipment) and provide service to the Web. FRII uses 4 strands of the Estes Park owned fiber between Estes Park and Loveland located on WAPA’s 115kv transmission system. . Level 3 – a large nationwide telecom company which provides internet “backbone”/network services (wires, servers, etc). Airbits – an Estes Park internet/wireless company which has transceivers in numerous locations around the Estes Valley, providing home and business internet service. They use Level 3 as their internet backbone provider to the rest of the world. Maximum speeds are advertised from 6MB to 12MB. There are other wireless internet providers in Estes Park. CenturyLink (Qwest) provides DSL (internet) service to homes and businesses in Estes Park. The closer to the CenturyLink building, the faster the speed. DSL can only go a limited distance from the telephone operator’s main office. DSL speeds in Estes Park range from about 1Mb to 6MB. CenturyLink can also provide fiber optic connections to businesses. Baja Broadband – Provides TV and broadband internet service to the Estes Park area. Maximum advertised speeds are in the 10MB range. The Town uses Baja for the Town’s TV channel and provides TV service to the Visitor’s Center. PRPAEstes Par k Ring City RingsEstes Park Long Haul Fiber laterals PRPAMicrowave & Fiber System Long Haul East City RingsEstes Park Long Haul Dixon-LaPorte-Poudre-Ault LHE to Airport Sub Loop PRPA Digital Micrwave System Long Haul West Rawhide Plant PRPA HQ DRC Longmont Civic Fiber Cable - 6 tubes, 12 strands in each = 72 strands The strands of fiber: Page 1 Report UTILITIES To: Honorable Mayor Pinkham Board of Trustees Interim Town Administrator Richardson From: Reuben Bergsten, Utilities Director Date: May 8, 2012 RE: PRPA Water Lease to Oil and Gas Industry Background: Platte River Power Authority has been approached by the oil and gas industry to lease water. Today we are looking for direction from the Town Board on how to proceed with the request. Hydraulic fracturing has been going on in Colorado since 1947. Combining horizontal drilling and fracking has made it economically feasible to develop the Niobrara Shale oil resources. In October of 2009 the "Jake" well started production and produced 50,000 barrels of oil in its first 90 days. This liquid hydrocarbon discovery has a higher value than natural gas and has generated a new demand for oil and gas exploration in Colorado. Production from these wells is not possible without horizontal drilling and fracturing. Fracturing requires the use of water and, after the fracking process is completed, most of the water is discharged into deep wells. A number of benefits can be listed for the development of this resource: • Reduce future electric rate pressures from PRPA • Reduce our dependency on foreign energy • Financially support the Central Colorado Water Conservancy District • Reduce future natural gas rate pressures by increasing the supply The benefits must be weighed against the drawbacks. To begin addressing the drawbacks, a common visual understanding of gas wells is required. Page 2 Figure 1 shows the drilling distance of the Niobrara Shale to be approximately 7,000 feet deep. The water aquifer resides at less than 1,000 feet. Throughout most of Colorado there exists a 4,000 feet thick layer of impermeable Pierre Shale. Figure 1, Niobrara Shale, Denver-Julesburg Basin Additional measures must be taken to maintain separation around the well shaft. Figure 2 shows the details of well shaft construction. The purpose of the surface casing is to seal off the shallow water aquifer. The lower production casing serves to seal off the oil and gas resource and ensure it only goes up through the well pipe. Page 3 Figure 2, Well Shaft Steel and Concrete Casing Page 4 Figure 3, Fracturing Process Page 5 Figure 3 depicts the fracturing process which is one component of the well drilling process. The Energy Act of 2005 gave exemptions to the oil and gas industry. Much to the credit of our Colorado State Government, Colorado has developed the most comprehensive oil and gas regulations in the nation. The EPA has recently (4-12-2012) issued standards to reduce harmful air pollution associated with oil and natural gas production. Shale oil production with horizontal drilling and fracturing is a relatively new process. As more experience and data becomes available, our regulatory bodies must continue to appropriately regulate the activity. Colorado has done an excellent job regulating this industry. Platte River Power Authority - Surplus Reuse Water Supply Platte River has an average 1,606 acre-feet per year of surplus reusable effluent resulting from its Windy Gap order and a Reuse Agreement with the City of Fort Collins. Platte River has marketed this surplus effluent over the years with a limited degree of success. In the past, there have only been two markets for the lease of surplus effluent: agricultural and augmentation. Agricultural water is considered single use and typically rents for approximately $10 to $40 per acre-foot. Augmentation water requires a reusable source and prices vary, but can be up to $500 per acre-foot. Demand for reusable water in Northern Colorado has historically been limited and Platte River has been compelled to lease its excess water primarily for single use. The demand for lease of water has changed significantly over the past year due to oil and gas well development in our region. A number of entities including the cities of Loveland, Longmont and Greeley lease surplus water for this purpose. Both reusable and single use water have been leased. A request was recently made of Platte River to lease of all its surplus reusable effluent for oil and gas development. Platte River’s surplus effluent is in demand because a large portion of the effluent is reusable and can be used to extinction anywhere within the State of Colorado, thereby making it an ideal supply of water for oil and gas well development. Because of the demand for Platte River’s surplus reusable effluent for oil and gas well development, Platte River’s Board of Directors wishes to develop a policy addressing leases for this purpose. Page 6 The following links provide additional information concerning this topic. Link to 4/24 Loveland City Council Study Session http://atlas.fcgov.com/2012_04_24LovelandSS/index.htm# Link to the League Of Women Voters Video on Fracking Below is a link to the “Cross Currents” program on YouTube (1.5 hours) http://www.youtube.com/watch?v=nhEZI4950c4 Representatives from PRPA and the Central Colorado Water Conservancy District will be in attendance for questions. Recommendation: There are several possible future recommendations to PRPA from the Town of Estes Park. This could be in the form of a resolution or motion. Placing this action item on the May 22, 2012 Board agenda would allow sufficient public notice. The possible resolution or motion at that public session would include: We support the leasing of Platte River Power Authority’s water for fracking operations or we do not support the leasing of Platte River Power Authority’s water for fracking operations.