HomeMy WebLinkAbout1999-08-17; City Council; 15357; Commonwealth Energy Corporation8 zi z 2
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CITY OF CARLSBAD - AGENDA BILL
TITLE- -
EXTENSION OF POWER SERVICES AGREEMENT
AND GREEN POWER ADDENDUM WITH
COMMONWEALTH ENERGY CORPORATION
CITY MGR +@
RECOMMENDED ACTION:
Adopt Resolution No. 79 *Aqo authorizing the City Manager to extend the Power
Services Agreement with Commonwealth Energy Corporation and to execute the “Green
Power” addendum, also with Commonwealth Energy Corporation effective July 1, 1999.
ITEM EXPLANATION:
On June 16, 1998, City Council authorized the execution of a Memorandum of
Understanding with SanDAG for participation in the regional power pool and an agreement
with Commonwealth Energy Corporation (CEC) to provide electric power. The Power Pool
operates through a committee established by the SanDAG Board. Council Member Finnila
serves as Carlsbad’s representative on the committee.
The Power Pool negotiated an agreement for energy provision at reduced rates. Based on
the last three months of data (April - June), Carlsbad’s annual savings is estimated at
$10,000. The term of the agreement expired June 30, 1999, with the option to renew for up
to four additional one-year periods. Due to the retirement of the staff member assigned to
the Power Pool project, the agreement was inadvertently allowed to expire without
execution of the extension. A letter requesting temporary extension pending formal
approval has been sent to CEC to ensure continuous service.
In addition to these savings, CEC is offering an addendum for provision of “green” power,
which is generated from renewable resources, i.e. solar, wind, or geothermal. Currently,
these sources are being subsidized by Energy Commission credits, resulting in a price that
is slightly lower (I%# per Kwh) than other energy sources. The addendum offers an option
(Option A) which automatically switches back to standard power upon expiration of the
subsidies. The Green Power addendum not only results in further cost savings, but also
provides a market for renewable energy sources.
FISCAL IMPACT:
The extension simply continues the discounted power agreement which has been in place
for the last year. The green power addendum currently saves an additional %$ per Kwh, for
an estimated total savings between $1.2,000 - $20,000.
EXHIBITS:
1. Resolution No. 99 -&?o with Green Power Addendum as Attachment A
2. Sample renewal letter to Commonwealth Energy Corporation
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RESOLUTION NO. 99-290
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, AUTHORIZING THE CITY MANAGER TO EXTEND THE COMMONWEALTH ENERGY POWER SERVICES AGREEMENT AND EXECUTE THE “GREEN POWER” ADDENDUM
WHEREAS, the City of Carlsbad is a member of the Regional Power Pool and entered
into an agreement with Commonwealth Energy Corporation to provide electric power; and
WHEREAS, the one-year term of said agreement expired June 30, 1999; and
WHEREAS, the City has the option to renew for up to four additional one-year terms;
and
WHEREAS, the Commonwealth Energy Corporation has also offered a “Green Power”
addendum to the original agreement; and
WHEREAS, the Commonwealth Energy Corporation has temporarily extended service
pending Council approval of extension of this agreement;
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Carlsbad as
follows:
1. The above recitatidns are true and correct.
2. The City Manager is authorized and directed to send a letter of renewal to Commonwealth
Energy Corporation effective July 1, 1999.
3. The City Manager is authorized to execute all further extensions allowed by the agreement.
4. The Green Power addendum attached hereto as Attachment A is hereby approved.
5. The City Manager is authorized to execute “Option A” of the Green Power addendum.
PASSED, APPROVED AND ADOPTED by the City Council of the City of Carlsbad at its
regular meeting held on the 17 day of Auaust , 1999, by the following vote, to wit:
AYES: Council
NOES: None
ABSENT: None
Members Lewis, N
KAREN
pact MO** 3ANDAG, 101 B krter. S&e if&I, Sm D&o CA 92101 fyuc MO&~
Attachment A
GREEN POWER ADDENDUM
This Agreement shall be considered an addendum to the agreement entit.Ied Commonwealth
Energy Power Services Agreement, by and between Commonwealth Energy Corporation (CEC)
and (Member), dated .
Member wishes to acquire all, or a portion of it’s electric energy requirements, served by CEC
through the San Diego Association of Governments Power Pool, from sources certified by the
Center for Resources Solutions as renewable energy, (“Green Power”), and which is eligible for
credits from the California Energy Commission’s Renewable Resource Trust Fund. CEC has
agreements in place to purchase Green Power from qualified generators and wishes to serve
member’s accounts listed on the pages attached hereto and made hereby a part of this
Agreement, under the following terms and conditions.
I. Member purchase price shall be: San Diego Gas & Electric applicable tariff plus one cent
per kwh, less all applicable Energy Commission credits, rebated in advance and
incorporated into the bill amount. (For example, should the tariff be ten cents for kWh, and
the applicable credit is 1.5 cents per kWh, the bill would be calculated as follows: ten cents
plus one cent minus 1.5 cents for a net billed amount of 9.5 cents per kWh.)
2. Member shall have two options regarding the accounts listed on the attached pages, and
shall indicate which option it chooses by having the signator to this addendum initial within
the box preceding the option it chooses. c 1 Option A
CEC will monitor the California Energy Commission RenewabIe Resource Trust
Fund account and the kWh consumption and costs for those accounts listed on the
attached pages and will automatically switch accounts which have reached the maximum allowable savings created by the Renewable Resource Trust Fund
credits, and higher than those specified in the Commonwealth Energy Power
Services Agreement, back to the standard offer in the Agreement. The switching of
an account will occur at the first billing cycle after the maximum allowable savings
is reached.
q Option B
Member shall have the right to switch any and all accounts subject to this
Agreement back to the standard offer, as outlined in the agreement that this
Attachment is made as an addendum, at its sole discretion, with thirty-day written
notice, upon the occurrence of either of the following events:
a) The California Energy Commission Resource Trust Fund credits are changed
from the current Ievel of 1.5 cents per kWh or discontinued; or
b) The account has reached its maximum allowable annual credit, if applicable.
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3. All other terms of the original agreement shall be in full force and effect, unless such terms
are in conflict with the Attachment A. In such an event, the terms of this Attachment A
shall Prevail.
4. CEC shall deliver Green Power to Member with generation from the Sonoma Geysers
Plants operated by Calphine Corporation and sold to CEC pursuant to an agreement valid
from May 1, 1999 through June 30, 2002. Should this supply agreement be in full effect
after June 30, 2002, ,CEC shall either extend its arrangement with Calphine to meet
Member’s needs, or substitute the power with a similarly qualified power source.
The undersigned agree as outlined above,
Frederick M. Bloom
Commonwealth Energy Corporation
Member
Name of Signator:
Name of Agency:
ATTACHMENT TO GREEN POWER ADDENDUM
Member Agency Accounts to be Serviced with Green Power
Member Agency Name:
Date:
q All San Diego Regional Power Pool Accounts.
q Only the FolIowing Accounts:
Account # Meter I# Meter Address
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June 21, 1999
EXHIBIT 2
Mr. Fred Bloom
CEO and Chairman
Commonwealth Energy Corporation
15991 Red Hill Avenue
Tustin, CA 92780
RE: Renewal of Power Services Agreement
Dear Mr. Bloom:
This letter constitutes written notice to renew the Commonwealth Energy Power Services
Agreement between Commonwealth Energy Corporation and the San Diego Regional Power pool participating agency identified below for an additional one year term srarting July 1,1999.
Member Agency Signature;
Name of Signator:
Name of Agency:
cc: Steve Sachs, SANDAG
401 B. Street, Suite 800
San Diego, CA 92101
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;,RITE IT - DON’T SAY ;‘r!
Date August 20’ 1999
To NOTE TO FILE 0 Reply Wanted ”
From KATHLEEN SHOUP ClNo Reply Necessary
AGENDA BILL NO. 15,357 Resolution NO. 99-290 POWER SERVICES AGREEMENT &
GREEN POWER ADDENDUM WITH COMMONWEALTH ENERGY CORPORATION 1' .' '. _-_
Per my phone conversation with Julie Ross/Public Works,on August 19,L1999, she
will be processing for signatures the Green Power Addendum attached to Council.
Resolution No. 99-290. She will also process an original letter of renewal to
Commonwealth Energy Corporation.
Her agreement with me was that she will provide the City Clerk's Office with
the original signed documents when they are returned to her.
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