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HomeMy WebLinkAboutresolution.council.136-23RESOLUTION # 136 (Series of 2023) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, APPROVING A FOURTH REVISED SUPPLEMENTAL AGREEMENT BETWEEN THE CITY OF ASPEN AND MUNICIPAL ENERGY AGENCY OF NEBRASKA, AUTHORIZING THE CITY MANAGER TO EXECUTE SAID AGREEMENT ON BEHALF OF THE UTILITIES DEPARTMENT OF THE CITY OF ASPEN, COLORADO. WHEREAS, there has been submitted to the City Council a fourth revised supplemental agreement, between The Aspen Utilities Department, an enterprise owned and operated by the City of Aspen and Municipal Energy Agency of Nebraska ("MEAN") a substantially complete copy of which is attached hereto as Exhibit "C"; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, That the City Council of the City of Aspen hereby approves a fourth revised supplemental agreement, between The Aspen Utilities Department, an enterprise owned and operated by the City of Aspen and MEAN, a substantially complete copy of which is annexed hereto and incorporated herein and does hereby authorize the City Manager to execute said agreement on behalf of the Utilities Department of the City of Aspen. INTRODUCED, READ AND ADOPTED by the City Council of the City of Aspen on the 261 day of September 2023. Torre, Mayor I, Nicole Henning, duly appointed and acting City Clerk do certify that the foregoing is a true and accurate copy of that resolution adopted by the City Council of the City of Aspen, Colorado, at a meeting held on the 26' day of September 2023. Nicole Henning, City Clerk DocuSign Envelope ID: F5168C89-D75D-439E-B4B6-OF9C6933F453 Fourth Revised Supplemental Agreement between Municipal Energy Agency of Nebraska and The City of Aspen, Colorado This Fourth Revised Supplemental Agreement, dated the 26th day of September , 2023, between the City of Aspen, Colorado, a home rule city of the State of Colorado (Aspen), and the Municipal Energy Agency of Nebraska, an agency and political subdivision of the State of Nebraska (MEAN), supersedes and replaces effective October 1, 2023, the Third Revised Supplemental Agreement between Aspen and MEAN executed as of August 25, 2015, and Amendment No. 1 to Third Revised Supplemental Agreement executed as of May 9, 2019. WHEREAS, due to unique circumstances affecting the sale of electric capacity and energy by MEAN to Aspen, the parties desire to agree on certain contractual terms in addition to those that would normally attend the sale of the electric capacity and energy by MEAN to a municipal customer; and NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the parties hereby agree as follows: 1. The parties have executed standardized contracts governing the sale of electric capacity and energy by MEAN to Aspen. These Agreements are the Service Schedule M Total Power Requirements Power Purchase Agreement (Schedule M Agreement), dated June 25, 1984, and the Green Energy Program Subscription Confirmation executed March 17, 2023 (collectively referred to as the Preexisting Power Agreements), which are incorporated herein by this reference. In the event of any conflict or contradiction between the provisions of one or more of the Preexisting Power Agreements, and the provisions of this Agreement, this Agreement shall govern and control. 2. The City of Aspen, Colorado owns and operates the Ruedi hydroelectric plant under a permit issued by the Federal Energy Regulatory Commission (FERC) with a rated capacity of five megawatts and a hydroelectric project known as Maroon Creek with a rated capacity of .5 megawatts; and Aspen has acquired an interest in the output of the Ridgway Hydropower Project (Ridgway); which projects are used to supply capacity and energy to Aspen for resale to its customers, or in the case of Ridgway, the output is managed and used by MEAN as described herein. The parties acknowledge that a portion of the Ridgway output procured by Aspen will be resold to MEAN under a separate written agreement between Aspen and MEAN. For purposes of this Agreement, only the share of the Ridgway output associated with the capacity amount for Ridgway on Exhibit B shall DocuSign Envelope ID: F5168C89-D75D-439E-B4B6-OF9C6933F453 be considered Aspen's share of Ridgway (Aspen's Ridgway Share), and MEAN's share of Ridgway output shall not be considered Aspen's Ridgway Share. MEAN is fully aware that Aspen is planning and may construct itself, or jointly with third parties one or more of the additional proposed hydroelectric projects listed in Exhibit B to this Agreement that may also be used to supply capacity and energy to Aspen. Aspen has received a Western Area Power Administration (WAPA) demand allocation under the Salt Lake City Area Integrated Projects of 988 kW in the summer season and 1,560 kW in the winter season. The parties acknowledge that Aspen's purchases under the Schedule M Agreement have been modified by the Green Energy Program Subscription Confirmation. Notwithstanding anything to the contrary in this Agreement, the parties expressly agree that the amount of hydropower output used to reduce Aspen's total load under this Agreement for each unit shall be limited and is deemed not to exceed generation associated with the capacity amount listed for each respective unit on Exhibit B to this Agreement. 3. Calculation of Fixed Cost Recovery Charge and Energy Charge A. Fixed Cost Recovery Charge for Aspen will be billed as set forth in the then -current Exhibit B, Schedule of Rates and Charges, to the Schedule M Agreement, which Schedule of Rates and Charges is subject to change from time to time upon action of the MEAN Board of Directors. B. Energy Charge. Monthly Billing Energy is determined as follows and will be billed at the applicable rate set forth in the then -current Exhibit B, Schedule of Rates and Charges, to the Schedule M Agreement: On an hourly basis, MEAN will reconcile the load and generation for Aspen. For each hour, the amount of supplemental energy supplied by MEAN under the Schedule M Agreement shall be actual metered energy minus the sum of energy supplied from WAPA and the energy generated from the hydropower projects listed on Exhibit B. Monthly Billing Energy equals the net of the amounts determined on an hourly basis for the current month, less applicable transmission losses as specified in the Public Service Company of Colorado (PSCo) network integration transmission service agreement (PSCo Contract), the Holy Cross Contract (as defined in Section 6) and the Tri-State Generation and Transmission Association, Inc.'s network transmission service agreement for MEAN's delivery of Aspen's Ridgway Share, for the current month ("net MEAN supplemental energy"). In any calendar month that Aspen's resources from the hydropower generation from the facilities listed on Exhibit B exceed the City's total electric power and energy requirements net of WAPA energy allocations, MEAN will carry over the excess hydro energy (kWh) to the immediately succeeding calendar month(s) billing and shall reduce the amount of net MEAN supplemental energy billed in the succeeding month(s) by an amount equal to the excess hydro energy (kWh) that is subject to carryover until fully exhausted. 4. Aspen shall be treated, for purposes of the Schedule M Agreement, as if those DocuSign Envelope ID: F5168C89-D75D-439E-B4B6-OF9C6933F453 hydroelectric generating facilities listed in Exhibit B which actually supply capacity and energy to Aspen, were WAPA Allocations (as defined in the Schedule M Agreement), and the following provisions of the Schedule M Agreement shall not be applicable to Aspen with regard to the facilities listed on Exhibit B: Schedule M Agreement Article XII and Article XIV 5. Division of responsibility for transmission losses: A. MEAN shall bear all transmission losses associated with delivery of MEAN power and energy to Aspen at the Delivery Point. The Delivery Point is set forth in Exhibit A to this Agreement. B. Aspen shall bear all transmission losses associated with the delivery of WAPA power and energy as well as power and energy from the facilities listed on Exhibit B. 6. Division of responsibility for transmission charges: A. MEAN has entered into the PSCo Contract for delivery by PSCo of power and energy from MEAN resources, Ruedi and WAPA. Aspen has entered into the Holy Cross contract for use of Holy Cross transmission and distribution facilities for delivery of power and energy from Ruedi to the transmission system of PSCo and from the transmission system of PSCo to Aspen and for the delivery of all power and energy from the Delivery Point to Aspen (Holy Cross Contract). All Holy Cross charges shall be paid by Aspen. All transmission charges for MEAN's delivery of Aspen's Ridgway Share shall be the responsibility of Aspen as provided in subsection B below. B. Responsibility for the costs of transmission service for MEAN to serve the City of Aspen with MEAN resources shall be as set forth in the Schedule M Agreement and the then -current Exhibit B, Schedule of Rates and Charges, thereto. The City of Aspen is responsible for the portion of the transmission cost for delivery of power and energy from Ruedi, Aspen's Ridgway Share, WAPA and any other constructed hydropower projects currently listed as proposed on Exhibit B. All transmission costs, including losses, associated with Aspen's Ridgway Share shall be the sole responsibility of Aspen. Accordingly, Aspen shall be responsible for the lesser of the following costs: (i) costs of delivering Aspen's Ridgway Share from the Ridgway project to Aspen, or (ii) costs for delivering Aspen's Ridgway Share from the Ridgway project to MEAN's network load on Tri-State's system or other transmission provider's system (which load shall be that determined by MEAN in its sole discretion), including without limitation point-to-point transmission charges incurred to deliver to such network. DocuSign Envelope ID: F5168C89-D75D-439E-B4B6-OF9C6933F453 C. All arrangements for and charges for transmission, distribution, losses and other charges on and for all power and energy after it is delivered by MEAN to the Delivery Point shall be the sole responsibility of Aspen. Except as provided below for Aspen's Ridgway Share and for Green Energy, the Delivery Point shall be as set forth in Exhibit A to this Agreement. This Delivery Point shall also serve as the delivery point for Service Schedule M. The Delivery Point for Aspen's Ridgway Share shall be deemed to be the Tri-State meter, or such point as agreed hereafter by Aspen and Tri-State. The delivery point with regard to Green Energy shall be as set forth in Aspen's Green Energy Program Subscription Confirmation. 7. In the event Aspen shall become a Contract Purchaser (as defined in the Schedule M Agreement), Aspen's obligation to purchase and MEAN's obligation to supply electric power and energy shall thereafter be at a Contract Demand equal to the maximum clock hour integrated system demand of Aspen, less its WAPA allocation, occurring during each Billing Period for the 12 preceding monthly Billing Periods, adjusted to take into account any Aspen hydroelectric projects listed on Exhibit B operating during the 12 preceding monthly Billing Periods. The adjustment for hydroelectric projects shall be based upon the operating experience of each hydroelectric generation unit during the maximum clock hour of Aspen integrated system demand during the 12 preceding monthly Billing Periods. Contract Demand, as used herein, shall constitute the Firm Power Requirement for the City for purposes of 3.01 of the Schedule M Agreement. 8. Management of Aspen's Ridgway Share. Aspen hereby designates MEAN as the party exclusively responsible for scheduling and managing Aspen's Ridgway Share. MEAN shall manage Aspen's Ridgway Share and accept delivery of Aspen's Ridgway Share from Tri-County pursuant to the terms and conditions of the agreement between Aspen and Tri-County for Ridgway output. After receipt of Aspen's Ridgway Share by MEAN from Tri-County, MEAN shall manage Aspen's Ridgway Share in the manner determined by MEAN in its sole discretion (as further described in Section 6). The City agrees not to take any action or support any effort by Tri-County or any other third party that would restrict, affect or eliminate MEAN's right to use Aspen's Ridgway Share in the manner described in this Agreement. 9. Effective Date. This Fourth Revised Supplemental Agreement shall be effective as of October 1, 2023. 10. The parties mutually agree that the provisions of Section 4.02 of the Schedule M Agreement shall not apply in the case of events resulting from or caused by the negligent or intentional actions of MEAN. 11. It is mutually agreed and understood that the obligations imposed by the provisions of the Schedule M Agreement and this Fourth Revised Supplemental Agreement are only DocuSign Envelope ID: F5168C89-D75D-439E-B4B6-OF9C6933F453 such as are consistent with applicable state and federal law. The parties further agree that if any provision of the Schedule M Agreement or this Fourth Revised Supplemental Agreement becomes in its performance inconsistent with state or federal law or is declared invalid, they will in good faith negotiate to modify the agreement accordingly. 12. In no event shall the obligations imposed be diminished or agreements be modified so as to jeopardize the effectiveness of the Schedule M Agreement as security for the payment of notes, bonds, or other evidences of indebtedness issued by MEAN. 13. This Fourth Revised Supplemental Agreement shall be governed by the laws of the State of Nebraska. [SIGNATURE PAGE FOLLOWING.] DocuSign Envelope ID: F5168C89-D75D-439E-B4B6 OF9C6933F453 IN WITNESS WHEREOF, the undersigned parties have duly executed this Fourth Revised Supplemental Agreement as of the date below. MUNICIPAL ENERGY AGENCY OF NEBRASKA Robert L Digitally signed by Robert L Poehling y PoehlinDate:2023.09.18 B g 10:31:09-05'00' Title: Executive Director/CEO Date. CITY OF ASPEN, COLORADO L�Ar"#-'2 tpned by: By: G. (28y+4tFessera Title: City Manager Date: 10/26/2023 1 1:52:37 PM PDT Attest: ocu Sig nod by. F�D el�, hU A I" City Clerk (SEAL) K:\Legal\K\MEAN\ERPA\Aspen, CO\AspenFourthRevisedSupplementalAgmtFinal20230915.docx 6 DocuSign Envelope ID: F5168C89-D75D-439E-B4B6-OF9C6933F453 Exhibit A to the Fourth Revised Supplemental Agreement between Municipal Energy Agency of Nebraska and The City of Aspen, Colorado ❑eliyea Paint The Point of Delivery shall be the point(s) at the outlet of the interconnected transmission system where electric power and energy are delivered by or on the account of MEAN to the City of Aspen, Colorado (Participant), or to an intervening carrier agency for delivery to the Participant, which point(s) are as determined by the applicable Transmission Provider. Unless otherwise specified, the Point of Delivery refers to the point(s) at which the applicable Transmission Provider's transmission facilities interconnect with the Participant's distribution or transmission facilities or intervening carrier agency, if any. Notwithstanding the foregoing, to the extent the energy generated by behind the meter generation interconnected with a Participant's distribution system and leased to or purchased by MEAN is used by MEAN to serve such Participant, the energy may be delivered at the generator's point of interconnection with the Participant or alternate point at which MEAN acquires the energy as agreed in writing between MEAN and the Participant or Participant's customer. DocuSign Envelope ID: F5168C89-D75D-439E-B4B6-OF9C6933F453 Exhibit B to the Fourth Revised Supplemental Agreement between Municipal Energy Agency of Nebraska and The City of Aspen, Colorado Existing and Proposed H dro ower Promects of the City of Aspen, Colorado See attached. DocuSign Envelope ID: F5168C89-D75D-439E-B4B6-OF9C6933F453 EXHIBIT B EXISTING HYDROPOWER PROJECTS OF THE CITY OF ASPEN Y f Installed Estimated May- Estimated October - Project Location ear o September Energy April Energy Start-up Capacity (KW) production (GWH) Production (GWH) Ruedi Reservoir 1986 5,000 9.8 10.5 Maroon Creek Pipeline 1989 360 1.1 0.3 Ridgway Hydro Total of Installed Hydro 2014 4,500 6.4 9,860 17.3 PROPOSED HYDROPOWER PROJECTS TO BE BUILT OR PARTICIPATED IN BY THE CITY OF ASPEN Year of Installed Estimated May - Project Location Start-up Capacity (KW) September Energy April Energy Production (GWH) Production (GWH) Other Hydropower 1,780 5.2 1.5 Projects' 3.4 14.2 Total of Proposed Projects 1,780 5.2 Estimated October - 1.5 'Notwithstanding anything to the contrary in the Agreement, all proposed hydropower projects listed above are subject to approval by the MEAN Board of Directors. Accordingly, output from Other Hydropower Projects listed above may only be used to supply capacity and energy to Aspen or MEAN if approved by the MEAN Board of Directors.