HomeMy WebLinkAboutResolution 2008-058RESOLUTION NO. 2008-058
A RESOLUTION OF THE CITY OF NORTH RICHLAND HILLS, 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; APPROVING CAPP
CONTRACTING WITH FPL ENERGY AND DIRECT ENERGY AND
AUTHORIZING THE CITY MANAGER TO SIGN A CONTRACT WITH
CAPP FOR THE CITY'S ELECTRICITY NEEDS 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 COMMITMENTS TO PURCHASE
POWER THROUGH CAPP FOR ITS ELECTRICAL NEEDS FOR THE
PERIOD BEGINNING JANUARY 1, 2009, AND EXTENDING UP TO
DECEMBER 31, 2013.
WHEREAS, the City of North Richland Hills, 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
Resolution No. 2008-058
Page 1 of 3
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 City.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF NORTH RICHLAND
HILLS, 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 for a term to begin January 1, 2009 and extending up to December
31, 2013.
SECTION 2. 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 3. That the City will execute 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.
Resolution No. 2008-058
Page 2 of 3
SECTION 4. 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 5. 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.
PASSED AND APPROVED this 27th day of October, 2008.
~.~``°~0~~\1C`H~~L~gm"~~~~o~,, CITY OF H AND HILLS
~~~n... •.N yf~~.
_ ~ •_~ ~ By. Osca Tr vino Ma or
r y
ATTEST: ' ""`' j'n
~ ~'•. .''iy _s
T r
Patricia Hutson, Ci "'
APPR S TO ORM AND LEGALITY:
George A. Stapl s, City Attorney
APP ED AS TO CONTENT:
. ~ ~~~-„~
Karen Bostic, Assistant City Manager
Resolution No. 2008-058
Page 3 of 3