HomeMy WebLinkAbout06-1226 06-13-2006RESOLUTION NO. 06 -1226
A RESOLUTION OF THE CITY OF EULESS, TEXAS,
AUTHORIZING THE CITIES AGGREGATION POWER
PROJECT, INC. (CAPP), TO NEGOTIATE AN ELECTRIC
SUPPLY AGREEMENT FOR DELIVERIES OF ELECTRICITY
EFFECTIVE JANUARY 1, 2007; 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, 2007; AND COMMITTING TO
BUDGET FOR ENERGY PURCHASES IN 2007 AND 2008
AND TO HONOR THE CITY OF EULESS' COMMITMENTS TO
PURCHASE POWER FOR ITS ELECTRICAL NEEDS IN 2007
AND 2008 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 86 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 off of
the Price to Beat (PTB) rate for its members; and
WHEREAS, the CAPP Board and CAPP consultants are continuing to
investigate Tong term contracting options, CAPP members must secure short term (2007
and 2008) power supplies or revert to high price standard contracts and independently
shop for a power contract; and
WHEREAS, experience gained by the CAPP Board indicates that entering into a
wholesale power contract, as distinct from a retail contract, effective January 1, 2007
may provide for greatest potential savings for CAPP members and facilitate an ultimate
transition to fixed price long term agreements; 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
2007 deliveries under either a wholesale or retail agreement will be short-lived (in the
late spring — early summer 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; and
WHEREAS, experiences in contracting for CAPP load since 2002 demonstrated
that Retail Electric Providers demand immediate response to an offer and may penalize
delay with higher prices; and
WHEREAS, CAPP's current delivered energy prices provide savings when
measured against the PTB rate, and 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, 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 2007 and 2008 and honor its commitments to purchase power for
its electrical needs in 2007 and 2008 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 2007 as compared to a retail electric
delivery contract for 2007 and, if feasible, 2008.
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.
Resolution No. 06 -1226, Page 2 of 3
APPROVED AND ADOPTED at a regular meeting of the Euless City Council on
the 13th day of June, 2006, by a vote of 7 ayes 0 nays, and 0
abstentions.
APPROVED:
ATTEST:
S san Crim, TRMC, City Secretary
Resolution No. 06 -1226, Page 3 of 3