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.
The Department has secured purchase power contracts in effect through December 31, 2022. This new request would solicit pricing for 12-month, 17-month, 24-month, and 36-month terms in order to secure power up to and including December 31, 2025. The term of any contract that may be executed would depend on the pricing proposals received. The Department may also add a “green power” component to the pricing to support the City’s sustainability objectives.
It is in our customers' best interest to obtain stable prices in advance, and it may be beneficial to secure power for this period at this time. Wholesale electric prices are currently driven in large measure by the price for natural gas, which is often the fuel used to generate power by those generators setting price in the PJM market. Presently, low natural gas prices and record levels of natural gas in storage have pushed the market down over recent months resulting in favorable market conditions for procuring additional electric generation supply. This wholesale power market environment warrants authorizing the Director of Public Utilities to negotiate contract terms with more than one potential supplier. This ordinance does not require the Director of Public...
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