2008-094-RES-AUTHORIZING THE CITY'S AGGREGATION POWER PROJECT, INC. (CAPP) TO NEGOTIATE AN ELECTRIC SUPPLY AGREEMENT FOR DELIVERIES OF ELECTRICITY AND NECESSARY RELATED SERVICES EFFECTIVE JANUARY 1, 2009RESOLUTION NO. 2008-094
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS,
AUTHORIZING THE CITIES AGGREGATION POWER PROJECT, INC. (CAPP)
TO NEGOTIATE AN ELECTRIC SUPPLY AGREEMENT FOR DELIVERIES OF
ELECTRICITY AND NECESSARY RELATED SERVICES EFFECTIVE JANUARY
1, 2009; APPROVIIVG CAPP CONTRACTING WITH FPL ENERGY A1VD
DIRECT ENERGY AND AUTHORIZING THE CITY MANAGER TO SIGN A
CONTRACT WITH CAPP FOR THE CITY'S ELECTRICITY 1VEEDS FOR THE
PERIOD BEGINNING JANUARY 1, 2009 AND EXTENDING UP TO
DECEMBER 31, 2013; COMMITTING TO BUDGET FOR ENERGY
PURCHASES AND TO HONOR THE CITY'S COMMITMEIVTS TO PURCHASE
POWER THROUGH CAPP FOR ITS ELECTRICAL NEEDS FOR THE PERIOD
BEGINNING JANUARY 1, 2009, AND EXTENDING UP TO DECEMBER 31,
2013; MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE
SUBJECT; AND DECLARING AN EFFECTIVE DATE.
WHEREAS, the City of Paris, Texas (City) is a member of Cities Aggregation Power
Project, Inc. (CAPP), a nonprofit political subdivision corporation dedicated to securing
electric power for its 111 political subdivision members in the competitive retail market;
and
WHEREAS, CAPP negotiated favorable contract terms and a reasonable commodity
price for delivered electricity since 2002 resulting in significant savings for its members;
and
WHEREAS, the City's current contract for power expires December 31, 2008; and
WHEREAS, CAPP members must secure power supplies for 2009 or revert to high
price standard contracts and independently shop for a power contract; and
WHEREAS, the CAPP Board of Directors is currently considering indicative retail
energy prices that point to favorable pricing for the five year period ending December 31,
2013;and
WHEREAS, power providers desire to execute a contract with one, and only one,
entity rather than have unique contracts for each CAPP member; and
WHEREAS, CAPP believes that the pricing opportunity window for favorable 2009
deliveries will be short-lived and that CAPP must be able to commit contractually to prices
within a 24-hour period in order to lock-in favorable prices; and
WHEREAS, experiences in contracting for CAPP load since 2002 demonstrated that
providers demand immediate response to an offer and may penalize delay with higher
prices; and
WHEREAS, aggregated rates contracted during favorable pricing periods are likely
to be lower than prices obtained by the City contracting individually during the same time
period; and
WHEREAS, suppliers demand assurance that CAPP will pay for all contracted load;
and
WHEREAS, the City must assure CAPP that it will budget for energy purchases and
honor its commitments to purchase power for its electrical needs through CAPP for the
period beginning January 1, 2009 and extending through December 31, 2013; and
WHEREAS, CAPP intends to continue to contract with both FPL Energy (power
supply) and Direct Energy (billing, administrative and other customer services); and
WHEREAS, the current contractual relationships between CAPP and FPL Energy
and Direct Energy have been beneficial and cost effective for CAPP members and the Ciry.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
PARIS, TEXAS:
Section 1. That the findings set out in the preamble to this resolution are hereby in
all things approved.
Section 2. That the CAPP Board and its consultants and advisors are agents
authorized to negotiate for the City's electricity needs as a member of CAPP for a term to
begin January 1, 2009 and extending up to December 31, 2013.
Section 3. That the City approves CAPP contracting with FPL Energy and Direct
Energy for the supply of electric power and related, necessary services for the City for a
term to begin January 1, 2009 and extending up to December 31, 2013.
Section 4. That the City Manager be, and he is hereby authorized and directed to
execute on behalf of the City of Paris a contract with CAPP that permits the Chairman of
CAPP to sign a Commercial Electric Service Agreement ("CESA") for the City's electricity
needs and related, necessary services beginning January 1, 2009 and extending up to
December 31, 2013, as a member of CAPP and commits its load for the same period
pursuant to the contract recommended and approved by the CAPP Board of Directors.
Section 5. That the City will budget and approve funds necessary to pay electricity
costs proportionate to the City's load under the supply agreement arranged by CAPP and
signed by the Chairman of CAPP on behalf of all CAPP members for the term beginning
January 1, 2009 and extending up to December 31, 2013.
Section 6. That a copy of the resolution shall be sent to Mary Bunkley with the Ciry
Attorney's office in Arlington and Geoffrey M. Gay, legal counsel to CAPP.
PRESENTED AND PASSED on this 27th day of October, 2008, by a vote of 5 ayes
and 0 nays at a regular meeting of the City Council of the City of Paris, Texas.
esse Ja es Freelen, Mayor
ATTEST:
~
,
J nice Ellis, City Clerk
APPROVED AS TO FORM:
W. Kent Mc ya Ci Attorney
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