Explanation
Background: This Ordinance authorizes the Director of the Department of Finance and Management to negotiate with multiple certified energy suppliers in the State of Ohio for deregulated electric supply of all City-owned facilities on the AEP Ohio distribution system. The current electric supply contract expires in April 2025. The authority of the Finance Director to negotiate such contracts shall extend only to the next contract period. Further negotiating authority for any future contracts beyond that granted by this ordinance will require additional authorization from City Council. Due to the fluid nature of electricity costs, it is in the City’s best interest to routinely shop for more cost effective energy prices. The City has established a Universal Term Contract (UTC) with New River Group, LLC dba Scioto Energy Co. for services related to assisting with the procurement of electrical energy supply prices/costs. This Ordinance seeks authority to engage Scioto Energy, via the aforementioned UTC, to assist with the procurement and negotiation of electrical energy prices that are more beneficial and cost effective than existing rates being paid by the City.
The cost benefits of procuring power through competitive supply are twofold: 1) it allows the City to schedule procurement during periods of low energy prices, and 2) there is normally high demand among competitive suppliers who bid on the City's energy utilization, which ensures that the City receives the most competitive prices. In addition to lower energy costs, procuring power through competitive supply also provides an opportunity to increase the percentage of “green” power the City utilizes. This is accomplished through the inclusion of Renewable Energy Credits (REC’s). These REC’s are priced separately from base energy prices and fluctuate with market movements as well. Scioto Energy will assist the City with the potential procurement of green power by soliciting green pricing proposals f...
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