HomeMy WebLinkAbout1998-10-14 98-413 RESOLVEItem No�`�19
Date: 10-14-98
Item ubject Resolvq Authorizing the City Marinate to Execute a Joint Agreement Regarding
Feasibility Study for Aggregation of Electric ty
Responsible Department: Precative
Commentary:
This proposed Resolve would amhori c the City Maoagerto sign ajoGd agreement with the Cumberlend-
York Aggregation Coalition (CYAQ for the purpose of participating in a feasibility study regarding
aggregetion of electricity for approximately 50 Maine municipalities. The feasibility study will develop
bcrwficialdatatrends,oppor ihesandelectricaluw info ionfor Neparticipents. Thisinformation
will be valuable w Mauve moves roweMelearical deregulation in March 2000. This action only commits
the City to participating in the stody. My decision to proceed further after the compledon of the study,
which involves the expenditure ofadditiorml funds, would require subsequent City Council action.
Aaeociakd Information:
Resolve, Memo dated 10-1-98, Join[ Agreement, Selected Consultant Proposal for Work
Budget Approvah
Pirumce Director
Legal Approval:
/f -fl f- City Solicitor
Introducwl for
x Passage
First Reading Page _ of
_Referral
Assigned to Councilor teem October 14, 1998
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WHEREAS, deregulation ofelecnfcity in the Sure of Maine will occuron March 1, 2000 creating new
purchasing opportunities for cities and towns through the State; and
WHEREAS, the Cumberland -York Ag®ega[ion Coalition(CYAC), a group of some 50 municipalities,
is currently exploring a variety of aggregation possibilities; and
WHEREAS, the City of Bangor has been invited to participate in the inifial Feasibility Study through
membembip in We CYAC of cost of two hundred dollars ($200);
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCH, OF THE CITY OF BANGOR,
THAT: the City Manageds hereby authorized to execute a Preliminary Joint Agreement
for Cooperation on Issues Related to the Aggregation ofFlecnical CLstomem allowing the
City of Bangor to become a member of the CYAC and to become a participant in the
Feasibility Study.
IN CITY COUNCIL
October 14. .1998
Motion for Passage Made and
Seconded
Passed
CI CLERK
98-413
R E S O L V E
Authorizing the City Manager to Execute
Regarding a ity
Study for Aggregation of Electricity
MEMORANDUM 98-413
To:
Finance Committee
From:
Robert W. Fonar, Assistant City Manager
Subject:
Utility Aggregation Update
Date:
October 2,1998
As the Committee may recall, staff presented an interim progress report in July concerning
various efforts underway and opportunities concerning the pending deregulation of vLargy within
the State of Maine. Included in this report were a series of recommendations for future action.
The fast recommendation was to maintain contact with the YorkCumbaland Aggregation
Coalition, a group of some 50 cities, town and other local government entities who were
actively involved in exploring aggregation opportunities. Several Finance Committee members
expressed a strong interest in developing a closer relationship with this group, given their
progress in this area and this natural grouping of mmmunities.
The City of Bangor was recently invited to join this coalition, and we readily accepted given the
opportdty to become associated with an established group. Our only commitment at this point
is aone-time payment of $200 which will help pay for an Aggregation Feasibility Study in which
aE members are participating. The van majority of the feasibility study (S±20,000) is being
underwritten by a grant from Cumberland County, while the ransoming can ($310,000) will
come from 50 or so participating communities.
The fuel roster of participating communities had to be established on Tuesday, September 25th.
Based upon the previous interest indicated by the Finance Committee and the potenthl benefits
to be gained fiat being part of this Feasibility Study, including the accumulation of energy tiara,
discussion of aggregation strategies and other valuable information, we made the decision tojoin
this ongoing effcrt.
Becoming pct ofthis study only commits the City to be involved m the Feasibility Study. At
the conclusion of the study, wecan continue with the group, or opt out, at our discretion. The
Cumberland -York Aggregation Coalition was very pleased that we expressed interest in
participating in the study and they have provided us with a series of documents relating to the
study which are attached.
Tose only action required at this time is for the City Council to authorize the City Manager to smb
a document entitled "Preliminary Joint Agmemeot for Cooperation on Issues Related to the
Aggregation of Electrical Customers" (copy attached). his agreement essentially outlines the
terms and condition of participating in the Aggregation Study.
We would recommend that the Finance Committee approve this request and forward this
Agreement to the full Council for consideration and approval.
Should any Councilors have question in the meantime, please do not hesitate to contact me at
your convenience.
RWF/j
Enclosures
cc: City Manager
98-413 r/l
PRELL @NARY JOINT AGREEMENT
FOR COOPERATION ON ISSUES RELATED
TO THE AGGREGATION OF ELECTRICAL CUSTOMERS
The parties to this Amstemem are governmental or quest -governmental units of the State
of Maine acting through the authority bestowed an them by Maine law.
I. General pu se.
The general purpose oftNs Agreement is to provide for an organization through which
the parties (hereinafter "members") may jointly and cooperatively gather information necessary to
make informed judgments about the advantages and disadvantages of agareaation for the purpose
of obtaining the lowest possible electrical rates followine de -regulation of the electrical utility
industry in Maine, add take such other steps as are necessary to procure the lowest possible
electric rates for the members.
The specific goals of the organization are U follows:
1. To enhance the ability of organizations to lower their con for street lighting and electrical
service in public facilities through the creation of a larger bargaining umd
_. To provide the basis for aegegation of all consumers within the CYAC representation;
.. To acquire the best overall market rate for electricity and transparent pricing through
common provisions without sacriftdne environmental protection;
4. To ensure economic benefits of competition will be shared equitably among all classes of
consumers;
-. To provide and enhance consumer protection and options for service under contract
provisions and to allow those consumers who choose not to participate to opt -our;
b. To foster greater end-use efficiency and the development of clean, renewable energy
sources through contract provisions, demonstration projects, and distribute energy
systems;
]. To provide full public accountability to consumers: and
S. To utilize the powers granted to municipal governments to achieve the above goals.
2�
J
11. Narnertforgalling
The name of the organization is the Cumberland(York Aggregation Coalition.
IM Membership.
Section 1. Arry governmental or quaff -governmental unit m Cumberland Ccmdy or
York County is eligible to be a member of the Coalition.
Section 2. A unit desiring to be a member shall execute a copy of this Agreement and
shall pay the established membership dues and charges.
Section 3. The initial members shall be those members whojoined the Coalition on or
prior to July 5, 1998,
Section 4. Units joining the Coalition after the signlng ofan a_eement for a feasibility
study shall be admitted only upon the favorable vote oftwo-thirds ofthe members of the Steering
Committee. The Steering Committee may impose conditions upon the admission ofinembers
other than the initial member.
1V, Steering Commatte
Section I. The Steering Committee shall be the governing body ofthe Coalition unless
and until a more formal structure and agreement replaces this Agreement. The Steering
Committee shall consist of five (5) members from each county chosen by Coalition members in
that county. Other members may be added as agreed to by the coalition. The Steering
Committee shall elect a chair and such other officers as it deems necessary to conduct the
Coafitiou's business.
Section 2. Ouoru Six (6) members of the Steering Committee shall constitute a
quorum for the purpose of holding meetings and malting decisions.
Section 3. Required Vote. My item placed before the Steering Committee for action
requires six or more votes in order to pass.
Section 9. Alte . The members that appointed a member ofthe Steering Committee,
may also appoint an alternate for that member. The alternate may participate in meetings when
the Steering Committee member is unable to attend the meeting and shall have the same rights and
power as the official member.
Section 5. Vawncv. A vacancy on the Steering Committee shall be filled by the
members who placed the original Steering Committee member on the committee.
98-613
Section6.LimitationonVolingRildit Amember of the Steering Committee shall not be
eligible to vote on behalf of his members during the time that any ofthe members that appointed
him or her are in default on any contribution to the Coalition or on any contract with it.
V Initial
The Steering Containing: will contract with a consulting to generate an RFP to conduct a
feasibility study that will be substantially the same as shown on Attachment 1 hereto as soon as
possible.
VI. Initial Fdist ofFeasbif'ty Study.
Each parry agrees to pay Two Hundred Dollars (800.00) on or before July 5, 1999 to
pay for the feasibility study and to be included as a participant in the study.
W. Financial Matters.
Section 1. The Coalition will not contract for a feasibility study whose cart exceeds S
30,000 without the approval of the Steens Committee.
Section?. Adminbstration and Comericl of Fun ds. Cumberland County shall establish a
separate account for funds received from Coalition members and disburse those funds in
accordance with the directives of the Steering Committee.
Section 3. Aooroval of Expend tures. The Steering Committee shall approve am
expenditure exceeding SI,000. Lesser expenditures may be approved by the Chair. In no case
may the Coalition contract for services or goods and supplies that have a total cost in excess of
the amount in the Coalition's account.
VII[ Withdrawal.
Any member may withdraw on thirty (30) daysprior written notice sent by certified mail,
return receipt requested, to the Chan of the Steering Committee or the Chair's designee.
IX Future Agreements.
The members anticipate that a more detailed agreement shall be prepared and signed to
further the Coalitions goals following receipt of the feasibility study and its analysis by the
Steering Committee.
3
98-413 T'
X.
Binding Nature Qf6gregilten
To the creat possible simers shall obtain authority to silpt this Agreement prior to signing
fiom the members governing body.
This Aeereement may be signed by an official or officer of member without prior written
approval of the members goventine body, but in such case the signatures shall not bind the
member until the members govemine body ratifies the Agreement and until ratified it ordy
constitutes a good faith obligation on the part of the rimer to obtain ratification and the members
financial commitment.
Dated
Printed Name
Office or Position of the Municipality/County
of
9
County of Cumberland
Response to the
Request For Proposals For
Consulting Services to Conduct An Aggregation
Feasibility Study For The Cumberland/York Aggregation Coalition
Submitted by:
Enywonmental Futures, Inc.
530 Atlantic Avenue
Boston,MA 02210
Tel: (617)443-1300• Pax: (617) 443-1360
Energetic Management Associates
Brunswick, Maine
Tel: 1207)721-9723• Tax: (207) 721-0384
Ed Holt and Associates
South Haepswell, Maine
Tel: (207) 7984588
July 14, 1998
�FZ
The process for procuring energy in the newly restructured environment will he complex,
especially in the first few years. Details of consumption patterns will emerge as new
informmion comes to light new technologies are developed, and protocols are
implemented. Numerous factors that will influence the potential for a cost-effective and
manageable procurement process and eventually influence the bid system. These include
the development of rules and regulations surrounding the operation of die Independent
System Operator (ISO), rema and conditions of service, metering protocols and
capabilities, energy balancing and settlement systems.
In preparing our recommendation for the CYAC, we would examine the implications of
Massachusetts's re3tmcturing experience for Maine, as retail competition in the
Massachusetts electric market has been severely reduced by the cost savings afforded by
the Standard Offer. While several entities are competing for commercial accounts, the
diversity and pricing of the current competitors has been subsequently limited. We
anticipate that once the Standard Offer has been established, special attention will be paid
to strategic pricing options and rhe during of supplier bids.
0. Work Plan
Outlined below is a preliminary draft work plan indicating estimated time frames, and rhe
deliverables involved in this project. Upon commencement of the work and
identification of project goals and needs, we will be better prepared to further fine -mire
this plan.
Time Frame
Task 1: Analysis of Customer Type by Class (Weeks 14)
a. Meeting #1: Project managers and key consultants: define scope, goals,
expectations, method for obtaining and exchanging information
b. Develop detailed workplan with definite timelines and deliverables
c. Assemble and review infommtion on interested entities through meetings,
correspondence, telephone
d. Meeting i12 or Conference Call: Presentation of preliminary findings, obstacles,
successes
e. Enter and compile information into Data Storage Worksheet
f. Analyze load profile information
g. Meeting 13: Presentation of Final Analysis
Deliverable: Report of compiled data specifying Profiles of Customers by
Class
Task 2: Identification of Unique Geographic, Technical, Customer, or Policy
Characteristics (Weeks 2-6)
a. Baseline Research
Is. Identify and interview CYAC & Key Stakeholders
c. Conduct several supplier interviews
d. Analyze Policy issues
e. Ascertain Unique Customer Characteristics
I. Technical Issues
Page 16
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