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HomeMy WebLinkAbout01-11-90-09 - Resolution - 01/11/1990RESOLUTION NO. 01-11-90-09 A RESOLUTION AUTHORIZING THE MAYOR OF THE CITY OF COLLEGE STATION, TEXAS TO EXECUTE A POWER PURCHASE AND PARTICIPATION OPTION AGREEMENT WITH THE CITIES OF GREENVILLE, BRYAN, GARLAND, AND DENTON, TEXAS. WHEREAS, the City of College Station, Texas is a whole- sale purchaser of power and energy for its municipal electric distribution system; WHEREAS, the City of College Station recognizing that its current power and energy purchase agreement expires January 1, 1992, accepted bids for the future purchase of power and energy; WHEREAS, after receiving offers for the sale of power and energy to the City of College Station, Texas the City Council reviewed the relative merits of each op- tion and on December 28, 1989, it chose to execute an agreement with the Cities of Greenville, Bryan, Garland, and Denton, Texas; WHEREAS, the Cities of Greenville, Bryan, Garland, and Denton, Texas constitute the membership of the Texas Municipal Power Agency; WHEREAS, the Cities desire to offer the City of College Station the option of joining in the Power Agency; and WHEREAS, the parties have presented to their respective governing bodies the agreement attached hereto. NOW, THEREFORE, BE IT RESOLVED By the City Council of the City of College Station that the Mayor is hereby authorized to execute the agreement attached hereto by a vote of the following participating members: Larry Ringer, Mayor Fred Brown Jim Gardner Lynn McIlhaney Vernon Schneider Dick Birdwell Dick Haddox FOR AGAIN X X X X The following Council Members have abstained from vot- .~ ing: Dick Haddox and Dick Birdwell. Councilman Fred _~ .~~~.''.~ Brown was not present at meeting. .~..~__~,~ ~.~ 007646 PASSED AND APPROVED THIS llth day of JANUARY, 1990. ATTEST: Dian/.on~, City Secretary APPROVED: Ma~O~~~ LC-50.5 AGREEMENT FOR WHOLESALE ELECTRIC SERVICE This Agreement is entered into by and between the City of College Station, a Texas Municipal Home-Rule Corporation (hereinafter referred to as College Station) and the cities of Bryan, Denton, Garland and Greenville, Texas, (hereinafter referred to as Supplying Cities) for the sale and purchase of wholesale electric service. WHEREAS, College Station has a need for an economical, reliable source of power and energy to supply its residents and to meet the demands of its load growth; WHEREAS, the Supplying Cities each own and operate municipal electric generation and distribution systems which have enough capacity to meet their load and power requirements, as well as reserve requirements and other contractual requirements for the period of this contract; WHEREAS, certain Supplying Cities currently have sufficient capacity to provide College Station with electricity for its current load; WHEREAS, the Supplying Cities desire to sell and College Station is willing to purchase power and energy on the terms and conditions herein set forth; WHEREAS, the Interlocal Cooperation Act expressly allows cities to make mutually beneficial agreements for the sharing of services and functions so as to provide for the welfare of their citizens and obtain beneficial economical savings; WHEREAS, the Supplying Cities and College Station desire to participate together in the planning, construction and use of future generation facilities; NOW THEREFORE, in consideration of the mutual undertakings herein contained, the Supplying Cities and College Station agree as follows: ARTICLE I. DEFINITIONS AS USED HEREIN (a) "TMPA" shall mean the Texas Municipal Power Agency. (b) "College Station" shall mean the City of College Station, Texas. (c) "Supplying Cities" shall mean the cities of Bryan, Texas; Denton, Texas; Garland, Texas; and Greenville, Texas. 007648 LC-50.5 (a) (b) (c) (d) (e) ARTICLE II. SALE AND PURCHASE OF POWER AND ENERGY The Supplying Cities agree to provide and College Station agrees to purchase and to receive the total requirements for power and energy which College Station shall require for the operation of its utility. Power and energy supplied under this contract may only be used to supply College Station retail customers and may not be resold to other utilities at wholesale or sold to any person or business pursuant to a written contractual arrangement or other understanding which differs in any respect from sales to the public generally. Power and energy supplied pursuant to this agreement shall commence on the 1st day of January 1992. In the event College Station determines that it will not participate with the Supplying cities in future generation, power and energy shall be supplied until the 31st day of December 1995 as provided herein. The Supplying cities will notify College Station two years prior to the time they will not have the capacity to supply College Station's required power and energy; in which event, without further liability to the Supplying cities, College Station shall be entitled to take all or part of its power and energy from another source. In that case, the Supplying Cities will supply power and energy to College Station on a schedule to be mutually agreed upon one year prior to College Station's purchases from the other source. At any rate, the Supplying Cities will not be required to build capacity for College Station's load if College Station does not participate in future generation projects. The Supplying Cities agree to provide College Station with any and all information that would lead a reasonable person to conclude that the Supplying Cities will not have sufficient capacity to meet College Station's requirements as set forth in College Station's ten-year forecast. In the event College Station determines that it will participate with the Supplying Cities on future generation projects, this agreement shall continue in full force and effect for College Station's load not supplied by these generation projects or generated by College Station as long as College Station is a participant in future projects or contractually joins with the Supplying cities subject to rate changes as set forth in Schedule "A." By February 1st of each year, College Station shall supply a ten-year forecast of its load, energy, and power requirements. The Supplying Cities shall supply requested increases in load, energy, and power requirements, subject to the terms of this contract. -2- 007649 LC-50.5 (f) The Supplying Cities shall make all necessary arrangements for transmission of power and energy from their generation source to College Station's metering points and shall assume as a part of the scheduled rate charges all transmission costs. (g) The Supplying Cities shall use reasonable diligence to provide a constant and uninterrupted supply of power and energy hereunder. If the supply of power and energy shall fail, or be interrupted, or become defective by reason of force majeure as hereinafter provided, the Supplying Cities shall not be liable therefor or for damages caused thereby. (h) The obligation of College Station to purchase power and energy shall not be a debt of College Station, but shall be discharged as an operating of its electric utility and only from electric utility revenues. ARTICLE III. FUTURE GENERATION The Supplying Cities shall notify College Station of the date that the Supplying Cities have identified as the date that College Station must make a contractual commitment to participate in the next phase of generation, no less than one year in advance of the contractual decision date. College Station agrees to promptly provide the Supplying Cities with its decision with regard to participation by the 365th day of receipt of said notice from the Supplying Cities. The parties agree that College Station will be credited by the supplying cities an amount pursuant to Schedule "B" on College Station's participation or contractual joinder in future generation projects built by TMPA. The Supplying Cities agree that they shall each use their best efforts to take necessary action to authorize and include the participation by College Station as an equal member of the future project to the extent permitted by law. The Supplying Cities and College Station shall jointly (each individual City's vote shall be based upon the vote of the voting members, each vote having equal weight) participate in the decision making process with regard to the construction of, financing of, and rates charged for generation by any new facilities. College Station upon sending notification to the Supplying Cities of its intent to participate in a future generation project shall utilize its best efforts to secure legal authorization to participate. ARTICLE IV. CONTRACT POWER The amount of power provided by the Supplying Cities initially shall be 110 MW of electric power. -3- 007650 LC-50.5 (a) (b) (a) (b) ARTICLE V. POINT(S) OF DELIVERY The Supplying cities shall deliver to College Station energy and power at three (3) phase, alternating current, at a nominal voltage of 138,000 volts, and a nominal frequency of sixty (60) hertz at College Station's South Substation and at its College Station Switch Station, and at other points or such different points or voltages as mutually agreed. College Station shall maintain its system such that the power factor at each metering point shall be between .90 lagging and .90 leading. In the event that the power factor at the time of monthly peak demand is less than .90 lagging, the demand for billing purposes will be adjusted by the formula: Adjusted demand = Actual demand x .90 Power Factor ARTICLE VI. METERS Metering equipment shall be furnished, installed and maintained by the Supplying Cities at each point of delivery to College Station at the high voltage side of the transforming equipment located there. The Supplying Cities shall read meters or cause meters to be read and bill College Station for the power and energy furnished pursuant to this agreement at monthly intervals. Supplying Cities shall test and calibrate meters or cause meters to be tested and calibrated by comparison with accurate standards at intervals of twelve months, or such other intervals as the parties agree. Supplying Cities shall also make or cause to be made special meter tests at any time at College Station's request. The costs of all tests shall be borne by Supplying Cities, provided, however, that if any special meter test made at College Station's request shall disclose that the meters are recording accurately, College Station shall reimburse Supplying Cities for the cost of such test. The Supplying Cities shall pay for the cost of the test whenever the test reveals the meter to be in error by more than one-half of one percent. The readings on any meter which shall have been disclosed by test to be inaccurate shall be corrected from the beginning of the monthly billing period immediately preceding the billing period during which the tests are made in accordance with the percentage of inaccuracy found by such test, provided, that no correction shall be made for a longer period unless the Supplying Cities and College Station mutually agree thereto. Should any meter fail to register, the power and energy delivered during such period of failure shall for billing purposes be estimated by the Supplying Cities and College Station from the best information available. The Supplying Cities shall notify College Station 007651 --4-- LC-50.5 or cause College Station to be notified in advance of the time of any meter reading or meter test. ARTICLE VII. RATES AND CHARGES (a) Supplying Cities agree to sell and College Station agrees to purchase power and energy on the terms and conditions set forth herein. Supplying Cities shall sell to College Station power and energy pursuant to Schedule "A" attached and incorporated herein. The rates and charges for the power and energy supplied are and shall be: (1) nondiscriminatory, and (2) fair and reasonable, and be based upon the Supplying Cities' average cost of providing the power and energy, and (3) said rates shall be adjusted annually to reflect the average costs per KWH as calculated on an annual basis, pursuant to Schedule "C" attached hereto. (b) The parties agree that the rates and charges designated in Schedule "A" are firm until College Station jointly participates in generating capacity that is in commerical operation or generates its own power and energy. In addition, average costs per KWH shall be calculated according to Schedule "C." However, on an annual basis, until College Station jointly participates in generating capacity that is in commerical operation or generates its own power and energy, within 120 days of September 30 of each contract year, the Supplying Cities shall review their average costs per KWH for the preceding year as compared to the costs charged pursuant to Schedule "C" and shall rebate to College Station any funds overcharged during the twelve-month billing period following September 30 of each contract year in which the overcharges occurred. In the event said average costs per KWH are greater than the actual rates and charges, then no additional charges shall be made to College Station. (c) After College Station participates in generating capacity in commerical operation or generates its own power and energy the calculation of average costs shall be charged to reflect that reduced demand on the Supplying Cities and then current Supplying City costs. ARTICLE VIII. DEFAULT (a) If College Station or the Cities fail or default in meeting the terms of this agreement and such default continues for a period of fifteen (15) days, then the nondefaulting party -5- 007652 LC-50.5 shall give written notice to the defaulting party specifying the nature of the default and the remedy that it, the nondefaulting party, seeks to impose if such default is not remedied within fifteen (15) days. Upon the expiration of the fifteenth (15th) day, the nondefaulting party shall be entitled, unless otherwise ordered by a court or regulatory body, to terminate service or pursue other available remedies at law or in equity, including cancellation of the contract. (b) If College Station fails to make any payment (hereinafter called a default in payment) to the Supplying Cities that it is required to make as payment for energy and power, and such default in payment continues for a period of =ifteen (15) days, the Supplying Cities shall give written notice to College Station. College Station shall, from the date of the mailing of such notice, have a period of thirty (30) days to pay the full amount then due to the Supplying cities. (c) With regard to disputed payments College Station may elect to make payment under protest of the nondisputed amount placing the disputed amount into escrow until the dispute is resolved with the Supplying cities. Once the dispute is resolved, the prevailing party shall be entitled to the disputed funds with interest. ARTICLE IX. FORCE MAJEURE The term "force majeure" as employed herein shall mean acts of God, strikes, lockouts, or other industrial disturbances, acts of the public enemy, orders or action of any kind of government of the United States or of the state of Texas or any civil or military authority, insurrections, riots, epidemics, lightning, fire, sabotage, riot, disturbance, explosion, flood, earthquake, storm, hurricane, wind, accident, failure of performance on account of any other cause not reasonably within the control of the party claiming such inability. If for any reason of "force majeure" any of the parties hereto shall be rendered unable, wholly or in part, to carry out its obligations under this agreement then such party shall give notice and the full particulars of such reasons in writing to the other party within a reasonable time after the occurrence of the event or cause relied on; the obligation of the party giving such notice, so far as it is affected by such particular "force majeure," shall be suspended during the continuance of the inability then claimed, but for no longer period, and such party shall have the duty to endeavor to remove or overcome such inability with all reasonable dispatch. No damage shall be recoverable from either party by reason of the causes above mentioned. It is further agreed, that the settlement of strikes and lockouts shall be entirely within the discretion of the party having the difficulty, and that the above requirement that any "force majeure" shall be remedied within reasonable dispatch shall not require the settlement of strikes or lockouts by acceding to the demand of opposing parties when such settlement is 007653 LC-50.5 unfavorable to it in the judgment of the party having the difficulty. ARTICLE X. GOVERNMENTAL REGULATIONS AND LAWS This agreement shall be subject to all of the valid rules, regulations, and laws applicable thereto, as promulgated by the United States of America, the state of Texas, or any other governmental body or agency having lawful jurisdiction or any authorized representative or agency of any of them. ARTICLE XI. EASEMENTS College Station and the Supplying Cities agree that the Supplying Cities shall, when permitted by existing easement, have full access to such easements, rights-of-way or property held by College Station, if, and to the extent, reasonably required for the provision of power and energy to College Station and not interfering with existing uses. ARTICLE XII. NOTICES Any notice, request, demand, statement or bill provided for in this agreement shall be in writing and shall be considered to have been duly delivered when sent by registered or certified mail, addressed as follows, unless another address has been designated, in writing, by the party entitled to receive the same: CITY OF COLLEGE STATION Attn: City Manager P.O. Box 9960 College Station, TX 77842 CITY OF BRYAN Attn: City Manager P.O. Box 1000 Bryan, TX 77805 CITY OF DENTON Attn: City Manager 215 E. McKinney Denton, TX 76201 CITY OF GARLAND Attn: City Manager P.O. Box 469002 Garland, TX 75046 CITY OF GREENVILLE Attn: Director of Electric Utilities P.O. Box 1049 Greenville, TX 75401 -7- 007654 LC-50.5 ARTICLE XIII. APPROVALS It is agreed that the parties' participation in this agreement shall be subject to the spproval of the appropriate governing bodies and authorization of the appropriate signature hereto. It is further agreed that the parties shall provide proof of authorization to sign this agreement. ARTICLE XIV. REPORTS The Supplying cities shall prepare and issue to College Station a semiannual report of fuel costs and charges to College Station. The Supplying cities shall also provide College Station with all reports and statements, not privileged by law or court decision, provided to them by TMPA, which reports shall include but not be limited to (i) financial and operating statement relating to the TMPA system; (ii) status of construction for each facility constituting the TMPA system during construction; and (iii) analysis of operations relating to the TMPA system. ARTICLE XV. RECORDS AND ACCOUNTS The Supplying cities shall keep accurate records and accounts of the power and energy transaction with regard to College Station. Additionally, the Supplying Cities shall provide, on reasonable request, access to all records and accounts of the Cities' system and of the transactions relating to each facility constituting the cities' system to the extent such information is relevant to the calculation or verification of average system costs. This duty to provide access to information shall not extend to information privileged by law or court decision. ARTICLE XVI. CONTRACTS TO BE SEPARATE This instrument embodies four separate contracts between the Supplying Cities and College Station. Each Supplying City's obligation under this contract shall be limited to a proportion of the total requirements which is calculated by multiplying College Station's requirement by a fraction, the numerator of which is the difference between that city's available capacity, including its then current entitlement from Gibbons Creek and 1.15 times that city's native peak load, not including other firm or nonfirm sales and the denominator of which is the sum of these calculations for all the Supplying Cities. ARTICLE XVII. ASSIGNMENT This agreement may not be assigned without the written consent of all other parties to the agreement. 007655 LC-50.5 ARTICLE XVIII. EFFECTIVE DATE The effective date of this agreement shall be January 1, 1990. ARTICLE XIX. SEVERABILITY The parties hereto agree that if any of the provisions of this contract should contravene or be held invalid under the laws of the state of Texas, such contravention or invalidity shall not invalidate the whole contract but it shall be construed as though not containing that particular provision, and the rights and obligation of the parties shall be construed and in force accordingly. ARTICLE XX. AMENDMENTS Notwithstanding anything in this agreement to the contrary, this contract may only be amended upon the written agreement of the parties. IN WITNESS WHEREOF, the parties hereto have caused this contract to be executed in their corporate names and their corporate seals affixed, all by the proper officer duly authorized thereunto, as of the day and year first hereinabove written. (Seal) By: CITY OF COLLEGE STATION, TEXAS M~q~dr ~ ~ ATTEST: dlt~ S~e c~.~a~y CITY OF BRYAN, TEXAS Mayor (Seal) ATTEST: By: ~ /~, ~ .,~ city' Sec~t~a-~y ! -9- 007656 LC-50.5 CITY OF DENTON, TEXAS (Seal) ATTEST: By: Mayor By: City Secretary CITY OF GARLAND, TEXAS (Seal) ATTEST: By: Mayor By: City Secretary CITY OF GREENVILLE, TEXAS (Seal) ATTEST: Chairman of Board By: Secretary of Board 007657 LC-50.5 SCHEDULE A RATES Demand Charge ................. $11.78/KW Energy Charge ................. $ 2/MWH DEMAND CHARGE SHALL APPLY TO THE MAXIMUM HOURLY COINCIDENTAL METERED DEMAND RECORDED OVER THE BILLING MONTH (AS ADJUSTED FOR POWER FACTOR, IF NECESSARY). A MONTHLY FUEL CHARGE WILL BE MULTIPLIED BY THE ENERGY CONSUMPTION. THE FUEL CHARGE WILL BE THE AVERAGE COST OF FUEL FOR THE SUPPLYING CITIES AND COLLEGE STATION. THE FUEL CHARGE WILL BE CALCULATED ON AN "ESTIMATE AND CORRECT" BASIS. THESE RATES WILL CONTINUE IN EFFECT UNTIL THE EARLIER OF DECEMBER 31, 1995 OR THE DATE OF COMMERCIAL OPERATION OF A GENERATING UNIT IN WHICH COLLEGE STATION IS EITHER THE JOINT OWNER OF GENERATING CAPACITY WITH TMPA OR PARTICIPANT WITH TMPA. AT THAT TIME NEW RATES WILL BE CALCULATED TO REFLECT THE REDUCED DEMAND ON THE SUPPLYING CITIES AND THEN CURRENT SUPPLYING CITY COSTS. 007658 LC-50.5 SCHEDULE B AT SUCH TIME THAT COLLEGE STATION JOINTLY PARTICIPATES WITH TMPA IN A TMPA PROJECT IN WHICH JOINT FACILITIES WITH AN EXISTING TMPA FACILITY EXISTS, THE VALUE OF THE PRO RATA SHARES OF THE EXISTING FACILITY WILL BE CALCULATED WHICH WILL SERVE THE NEW FACILITY. VALUE SHALL BE INSTALLED COST, LESS DEPRECIATION. COLLEGE STATION WILL PAY, AS A PART OF ITS PAYMENT FOR THE NEW JOINT FACILITY, ITS SHARE OF THE EXISTING FACILITIES. THE SUPPLYING CITIES WILL NOT PARTICIPATE IN THE TMPA PROJECT UNLESS COLLEGE STATION IS CREDITED $6,000,000 IN THE CALCULATION OF EXISTING JOINT FACILITIES. THOSE EXISTING FACILITIES WHICH SERVE THE NEW FACILITY INCLUDE, BUT ARE NOT LIMITED TO, LAND, RESERVOIR, SUBSTATION AND TRANSMISSION FACILITIES, ADMINISTRATION AND MAINTENANCE FACILITIES, AND THE LIKE. 007659 LC-50.5 SCHEDULE C THE SUPPLYING CITIES SHALL CALCULATE THEIR SYSTEM AVERAGE COSTS FOR THE PURPOSES OF ADJUSTING RATES AS IN ARTICLE VII BY ANNUALLY SUMMING THE DEMAND CHARGES OF TMPA, THE ENERGY CHARGES OF TMPA, THE OPERATING AND MAINTENANCE COSTS FOR POWER GENERATION OF THE SUPPLYING CITIES, DEBT SERVICE FOR GENERATION OF THE SUPPLYING CITIES, AND ANY OTHER ASSOCIATED COSTS OF GENERATION OF THE SUPPLYING CITIES. -13 - 007660