City of Columbus - File #: 0837-2006

• File #: 0837-2006
• Version: 1
• Type: Ordinance
• Status: Passed
• File created: 4/25/2006
• In control: Utilities Committee
• On agenda: 5/22/2006
• Final action: 5/24/2006
• Title: To authorize the Director of Public Utilities to negotiate and enter into a contract for purchase power, to waive provisions of Columbus City Code relating to award of contracts through the request for proposal process, to authorize the expenditure of $1.00 from the Electricity Operating Fund and to declare an emergency. ($1.00)

Date	Ver.	Action By	Action	Result
5/24/2006	1	CITY CLERK	Attest
5/23/2006	1	MAYOR	Signed
5/22/2006	1	Columbus City Council	Approved	Pass
5/22/2006	1	COUNCIL PRESIDENT	Signed
5/9/2006	1	Utilities Drafter	Sent to Clerk's Office for Council
5/8/2006	1	Auditor Reviewer	Reviewed and Approved
5/8/2006	1	CITY AUDITOR	Reviewed and Approved
5/8/2006	1	Utilities Drafter	Sent for Approval
5/8/2006	1	CITY ATTORNEY	Reviewed and Approved
5/5/2006	1	UTILITIES DIRECTOR	Reviewed and Approved
5/5/2006	1	Utilities Drafter	Sent for Approval
5/5/2006	1	Finance Reviewer	Reviewed and Approved
5/5/2006	1	FINANCE DIRECTOR	Reviewed and Approved
5/5/2006	1	Utilities Drafter	Sent for Approval
5/4/2006	1	Utilities Reviewer	Reviewed and Approved
5/4/2006	1	Utilities Drafter	Sent for Approval
5/4/2006	1	Utilities Reviewer	Sent for Approval
5/1/2006	1	Utilities Reviewer	Reviewed and Approved
5/1/2006	1	Utilities Drafter	Sent for Approval
4/25/2006	1	Utilities Drafter	Sent for Approval

Explanation

BACKGROUND: This legislation authorizes the Director of Public Utilities to negotiate with multiple potential providers of purchase power, to enter into a contract for purchase power and waives provisions of Columbus City Code relating to award of contracts through the RFP process. Based on the advice of consultants retained to assist in the selection process, it has been determined that it is in the City's best interest to negotiate contract terms with more than one power provider. Negotiating contract terms and power pricing with more than one provider will allow the City to secure the best contract available.

The Department of Public Utilities will request proposals from potential suppliers during May and will negotiate contract terms and conditions with suppliers deemed to have submitted responsive proposals. This process will allow department staff to compare proposals and terms in order to select the best purchase power contract for the Division of Power and Water.

The existing full requirements purchase power contract has been in effect since January of 2001. This contract was established prior to the restructuring of the electric industry and will expire on December 31, 2006. A new contract is required on January 1, 2007.

Wholesale electric prices are currently driven by the volatile and escalating prices for natural gas and coal that are used to generate electricity. It is also adjusting to restructuring/deregulation by the Federal Energy Regulatory Commission (FERC) and state public utility commissions in an effort to increase competition. These factors have created a seller's market for power producers and a change in the market dynamics from those existing at the time of execution of the existing contract. Wholesale purchase power suppliers are no longer willing to hold firm quoted prices. This wholesale power market environment warrants authorizing the Director of Public Utilities to negotiate contract terms with more...