17 - ELECTRICITY CONTRACT - Laserfiche WebLink

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WHEREAS, TCAP is owned by its members and distributes monetary and other resources according to relative load size of members and is controlled by a 15 member Board of Directors, all of whom must be city employees of members who represent diversity in size and geography; and WHEREAS, wholesale power prices within the deregulated Texas market are largely determined by the NYMEX gas futures prices for natural gas which are currently low and relatively stable, but which change daily; and WHEREAS, daily price changes require retail customers to execute a contract immediately upon receipt of a favorable offer; and WHEREAS, pursuant to Texas Local Government Code Section 252.022(a)(15) expenditures for electricity are exempt from competitive bidding requirements; and WHEREAS, on any given day, TCAP is able to capture a favorable wholesale price for any period of time, comparable to or better than any given REP or broker; and WHEREAS, TCAP intends to continue to contract with its current wholesale supplier, NextEra, because the relationship with NextEra is such that NextEra is willing, after it knows the size of a given load, to execute a contract at or below prescribed price and terms; and WHEREAS, the City desires to execute a contract for electricity for the period beyond the expiration of its current contract on December 31, 2017 that locks -in favorable wholesale prices under one of three different supply options: Option 1 - fixed -price, full- requirements at a price not to exceed 4.1 cents per kWh for the North and West zones or 4.25 cents per kWh for the South and Houston zones; Option 2 - fixed price for on -peak hours and variable spot market prices for off -peak hours; Option 3 - block energy at a fixed price to cover the base load hours, a fixed price for solar energy to cover mid -day peak hours (approximately 10% of total load) and variable spot market prices for all remaining consumption; and WHEREAS, TCAP will allow members six weeks from receipt of this resolution to consider whether to participate in this second opportunity to contract for post -2017 electrical supply, and thereafter allow NextEra until June 30, 2016 to contact for power for five years at a price not to exceed 4.1 cents per kWh in the North and West zones and a price not to exceed 4.25 cents per kWh in the South and Houston zones for Option 1 , so long as the aggregated load for any of the three supply options reaches at least 50 megawatts; and WHEREAS, wholesale suppliers demand assurance that TCAP will pay for all contracted load; and 2