Explanation
The purpose of this legislation is to authorize the Director of Public Utilities to extend the existing agreement with AEP Retail Energy for street light generation and transmission services.
The City of Columbus, Division of Power is a retail customer with AEP Ohio and owns street lights that are metered and billed by AEP Ohio. AEP Retail Energy is a competitive retail electric service provider and affiliate of AEP Ohio. The Division of Power has coordinated with AEP Retail Energy to reduce the power cost of the street lights on the AEP Ohio system.
By switching the generation and transmission of the street lights currently on the AEP Ohio system to AEP Retail Energy, the Department of Public Utilities in 2011 reduced the cost of the megawatt hours (MWh) from $62.62/MWh to $49.90/MWh for annual savings of approximately $126,000.00. AEP Ohio will continue to charge the Division of Power for distribution and customer charges. All the contractual information was reviewed and approved by the City Attorney's Office with the original contract in 2011. The Division and AEP Ohio would like to continue this cost saving measure by modifying the existing agreement and adding an additional 40 months to the original end date of August 2014. By continuing this agreement, it is anticipated that the Division will save over $100,000 annually for energy costs.
The Department of Public Utilities feels it is in the best interest of the City of Columbus to enter into this agreement with AEP Retail Energy to take advantage of the power cost savings. This ordinance is being submitted as an emergency so that the department will not have interruption in the agreement and will be able to continue to take advantage of the cost savings to the Division of Power.
1. Amount of additional funds: There are no additional funds needed. This amendment is to ADD: 40 months to the life of the agreement that was to end August 2014.
2. Reason additional needs were not foreseen: T...
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