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7.33.
Regular City Council Meeting
Meeting Date:
08/24/2021
Information
Agenda Item
Resolution - Lubbock Power & Light:
Consider a resolution delegating authority to the Director of Electric Utilities, to enter into and execute Purchase and Sale agreements, for the sale of renewable energy credits (“RECs”) when the Director of Electric Utilities determines that doing so is in the best interest of LP&L and its ratepayers.
Item Summary
The City of Lubbock, acting by and through Lubbock Power & Light, receives RECs from time to time. As an energy commodity, the profitability of a REC divestiture is generally determined by the purchase price of the REC. Accordingly, the ability to enter into an agreement quickly to sell RECs when the demand and the purchase price is highest will very likely result in securing a higher sale price for such RECs.
Therefore, when LP&L desires to sell RECs, the Director of Electric Utilities, or his designee, needs the ability to enter into REC sale agreements expeditiously for the disposition of such RECs in order to secure the highest purchase price possible for LP&L. Thus, so that LP&L can more competitively engage with the REC market, staff requests that the Director of Electric Utilities, or his designee, be able to execute agreements for the sale of RECs on behalf of the City of Lubbock, acting by and through LP&L.
The attached resolution provides for a delegation of authority to the Director of Electric Utilities, or his designee, to enter into agreements for the sale of RECs belonging to the City of Lubbock, acting by and through Lubbock Power & Light. The delegation further provides that the Director of Electric Utilities, or his designee, shall update the Electric Utility Board once a month on the total amounts received from any REC sales. The delegation may be revoked by the Electric Utility Board and will only take effect once the City Council of the City of Lubbock also approves the delegation.
Fiscal Impact
The revenues collected from the sale of all REC transactions will be transferred to the Purchased Power Cost Center (7315).
Staff/Board Recommending
David McCalla, Director of Electric Utilities
Attachments
Resolution - Delegation for RECs
EUB Resolution for Delegation
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