10.A.
City Council Meeting - DRAFT
- Meeting Date:
- 08/16/2016
- From:
- Nicole Woodman, Sustainability Manager/Interim Public Works Section Dir.
Information
TITLE:
Consideration and Adoption of Resolution No. 2016-30: A resolution of the City Council of the City of Flagstaff, Arizona authorizing the Arizona Power Authority Power Sales Contract; and establishing an effective date.
RECOMMENDED ACTION:
1) Read Resolution No. 2016-30 by title only
2) City Clerk reads Resolution No. 2016-30 by title only (if approved above)
3) Adopt Resolution No. 2016-30
2) City Clerk reads Resolution No. 2016-30 by title only (if approved above)
3) Adopt Resolution No. 2016-30
Executive Summary:
The Arizona Power Authority (APA) manages Arizona's allocation of hydroelectric power from Hoover Dam for the benefit of the state. Within the scope of that management, APA cooperated with federal, state, and non-governmental agencies to address regulatory and environmental matters that impact electric and water uses of the Colorado River.
In an effort to stabilize future energy costs and diversify its energy portfolio, the City applied for hydroelectric energy allocations through state and federal agencies on March 31, 2014. The City was awarded 373 kilowatts (kW) of Schedule D hydroelectric power for distribution.
The APA Power Sales Contract (Contract) authorized the sale of up to 814,103 kilowatt hours (kWh) of Hoover Dam hydroelectric power to the City annually for 50 years. 373 kW/814,103 kWh is equivalent to 2% of electricity used by the City in FY15 (36,636,576 kWh). The Hoover Dam electric power will be distributed to the Utilities Department at Lake Mary Water Treatment Plant, Rio de Flag Wastewater Treatment Plant and Wildcat Wastewater Treatment Plant, the City's highest energy users.
The City will be one of 71 districts, municipalities, and tribes to receive an energy allocation from the APA. Examples of other cities slated to receive energy through the APA include: Buckeye, Chandler, Glendale, Globe, Payson, Peoria, Phoenix, Scottsdale, Sedona, Sierra Vista, Tempe, Tucson, Williams and Yuma.
In an effort to stabilize future energy costs and diversify its energy portfolio, the City applied for hydroelectric energy allocations through state and federal agencies on March 31, 2014. The City was awarded 373 kilowatts (kW) of Schedule D hydroelectric power for distribution.
The APA Power Sales Contract (Contract) authorized the sale of up to 814,103 kilowatt hours (kWh) of Hoover Dam hydroelectric power to the City annually for 50 years. 373 kW/814,103 kWh is equivalent to 2% of electricity used by the City in FY15 (36,636,576 kWh). The Hoover Dam electric power will be distributed to the Utilities Department at Lake Mary Water Treatment Plant, Rio de Flag Wastewater Treatment Plant and Wildcat Wastewater Treatment Plant, the City's highest energy users.
The City will be one of 71 districts, municipalities, and tribes to receive an energy allocation from the APA. Examples of other cities slated to receive energy through the APA include: Buckeye, Chandler, Glendale, Globe, Payson, Peoria, Phoenix, Scottsdale, Sedona, Sierra Vista, Tempe, Tucson, Williams and Yuma.
Financial Impact:
APS electric rates at the three treatment plants range between $0.077 - $0.131 per kWh. For every penny saved per kWh, the City could save approximately $4,400 annually. At the current energy allocation (373 kW), a conservative estimate is $15,000 to $20,000 in annual savings, which will increase over time.
Connection to Council Goal and/or Regional Plan:
COUNCIL GOALS:
2) Ensure Flagstaff has a long-term water supply for current and future needs
3) Provide sustainable and equitable public facilities, services, and infrastructure systems in an efficient and effective manner to serve all population areas and demographics
7) Continue to implement the Flagstaff Regional Plan and focus efforts on specific plans
REGIONAL PLAN:
Goal E&C.2. Reduce greenhouse gas emissions
Goal E.1. Increase energy efficiency
Goal E.2. Expand production and use of renewable energy
Has There Been Previous Council Decision on This:
Preliminary information was provided to City Council at the July 5, 2016 meeting.
Options and Alternatives:
Not adopt Resolution No. 2016-30 and return the 373 kW energy allocation. This would result in higher electric rates and an increased cost to the City for the 814,103 kWh of energy used.
Community Involvement:
Collaborate: The City's current energy provider, APS, is supportive of customers purchasing energy through the Arizona Power Authority.