HomeMy WebLinkAboutRes 2008-10-02 CAPP 5 year Electric Supply Agreement.pdfCITY OF ANNA, TEXAS
RESOLUTION NO. 2008-10-02
A RESOLUTION OF THE CITY OF ANNA, 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
MAYOR OR OTHER DESIGNATED CITY OFFICIAL TO SIGN A
CON'T'RACT 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 Anna, 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
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 ANNA, 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.
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
Chaimnau 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.
PRESENTED AND PASSED on this 27" day of October, 2008, by a vote of 3 (Three)
ayes and 1 one nays at a regular meeting of the City Counci City of Anna, Texas.
Mayor Pro Tem, Kevin Anderson
ATTEST:
Na Wi ison, City
'y OF