City of Columbus - File #: 0529-2007

• File #: 0529-2007
• Version: 1
• Type: Ordinance
• Status: Passed
• File created: 3/27/2007
• In control: Utilities Committee
• On agenda: 4/23/2007
• Final action: 4/25/2007
• 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
4/25/2007	1	CITY CLERK	Attest
4/24/2007	1	MAYOR	Signed
4/23/2007	1	Columbus City Council	Approved	Pass
4/23/2007	1	COUNCIL PRESIDENT	Signed
4/13/2007	1	Utilities Drafter	Sent for Approval
4/13/2007	1	CITY ATTORNEY	Reviewed and Approved
4/13/2007	1	Utilities Drafter	Sent to Clerk's Office for Council
4/12/2007	1	Utilities Drafter	Sent for Approval
4/12/2007	1	CITY AUDITOR	Reviewed and Approved
4/12/2007	1	CITY AUDITOR	Reviewed and Approved
4/11/2007	1	Finance - Purchasing Reviewer	Reviewed and Approved
4/11/2007	1	FINANCE DIRECTOR	Reviewed and Approved
4/10/2007	1	Finance Reviewer	Reviewed and Approved
4/10/2007	1	FINANCE DIRECTOR	Reviewed and Approved
4/5/2007	1	Utilities Reviewer	Reviewed and Approved
4/5/2007	1	Utilities Drafter	Sent for Approval
4/4/2007	1	UTILITIES DIRECTOR	Reviewed and Approved
3/29/2007	1	Utilities Reviewer	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. Negotiating contract terms and power pricing with more than one provider should allow the City to secure the best contract available.

The Department of Public Utilities will request proposals from potential suppliers 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 2007. This contract will provide 75% of the Division of Power and Water's projected power needs for 2008. Under the terms of the contract with American Electric Power Service Corporation the division can contract with another supplier for 25% of the estimated power needs in 2008 and 50% of the estimated needs in 2009.

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. 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 than one potential supplier.

This ordinance is requested to be an emergency measure to allow contract negotiations to begin at the earli...