HomeMy WebLinkAbout04-1185 09-14-2004RESOLUTION NO. 04 -1185
A RESOLUTION OF THE CITY OF EULESS, TEXAS,
AUTHORIZING THE CITIES AGGREGATION POWER
PROJECT, INC. TO NEGOTIATE AN ELECTRIC SUPPLY
AGREEMENT FOR DELIVERIES OF ELECTRICITY
EFFECTIVE JANUARY 1, 2005; AUTHORIZING CAPP
TO ACT AS AN AGENT ON BEHALF OF THE CITY TO
ENTER INTO A CONTRACT FOR ELECTRICITY;
AUTHORIZING THE CHAIRMAN OF CAPP TO EXECUTE
AN ELECTRIC SUPPLY AGREEMENT FOR DELIVERIES
OF ELECTRICITY EFFECTIVE JANUARY 1, 2005; AND
COMMITTING TO BUDGET FOR ENERGY PURCHASES
IN 2005 AND TO HONOR THE CITY OF EULESS'
COMMITMENTS TO PURCHASE POWER FOR ITS
ELECTRICAL NEEDS IN 2005 THROUGH CAPP.
WHEREAS, the City of Euless, Texas (City) is a member of Cities Aggregation
Power Project, Inc. (CAPP), a nonprofit political subdivision corporation dedicated to
securing electric power for its more than 80 members in the competitive retail market;
and
WHEREAS, CAPP negotiated favorable contract terms and a reasonable
commodity price for delivered electricity in 2002, 2003, and 2004 resulting in significant
savings off of the Price to Beat (PTB) rate for its members; and
WHEREAS, preliminary information provided to the CAPP Board indicates that
entering into a wholesale power contract, as distinct from a retail contract, effective
January 1, 2005, may provide the greatest potential for savings for CAPP members
over the regulated PTB rate; and
WHEREAS, potential wholesale 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
2005 deliveries under either a wholesale or retail agreement will be short-lived (in the
September to mid- November time period) and that CAPP must be able to commit
contractually to prices within a 24 -hour period in order to lock -in favorable prices
regardless of whether CAPP continues its historic practice of retail agreements or
enters the wholesale market; and
WHEREAS, experiences in contracting for 2002 -2004 demonstrated that Retail
Electric Providers demand immediate response to an offer and may penalize delay with
higher prices; and
WHEREAS, it is necessary for the City to contract for a supply of electricity for
2005 or at least partially revert to PTB rates; and
WHEREAS, CAPP's current delivered energy prices provide savings when
measured against the PTB rate, and PTB rates will likely continue to remain higher than
prices CAPP can achieve on behalf of the City; and
WHEREAS, wholesale suppliers demand assurance that CAPP will pay for all
contracted load; and
WHEREAS, the City of Euless needs to assure CAPP that it will budget for
energy purchases in 2005 and honor its commitments to purchase power for its
electrical needs in 2005 through CAPP.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF EULESS, TEXAS:
SECTION 1
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 and to evaluate
wholesale power supply contract options for 2005 as compared to a retail electric
delivery contract for 2005 and, if feasible, 2006.
SECTION 2
THAT the Chairman of CAPP is hereby authorized to sign an electric power
agreement for the City pursuant to the contract approved and recommended by the
CAPP Board of Directors within 24 hours of said approval and recommendation.
SECTION 3
THAT the City will budget and approve funds necessary to pay electricity costs
proportionate to the City's load under the supply agreement (whether wholesale or
retail) arranged by CAPP and signed by the Chairman of CAPP for the City.
SECTION 4
THAT a copy of the resolution shall be sent to Mary Bunkley with the City
Attorney's office in Arlington and Geoffrey M. Gay, legal counsel to CAPP.
PRESENTED AND PASSED on this 14th day of September, 2004, at a regular
meeting of the City Council of the City of Euless, Texas by a vote of 7 ayes, and
0 nays, and 0 abstentions.
APPROVED:
Mary Li Saleh, Mayor
Resolution No. 04 -1185, Page 2 of 2
ATTEST:
usan Crim CMC, Citiy Secretary