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HomeMy WebLinkAbout12 City of Fallon NCPA Agenda Item # ( d� J -1- NUNN Memorandum To: Board of Directors From: Stephen Hollabaugh Date: August 27, 2004 Subject: Western Area Power Administration assignment of City of Fallon base resource to Truckee Donner Public Utility District History- Truckee Donner Public Utility District (District) and the City of Fallon (Fallon both were assigned Western Area Power Administration (WAPA) base resource percentages starting in January 2005. The District and Fallon are members of UAMPS but the District is also a member of NCPA. The District and Fallon are within the Sierra Pacific transmission control area and the Western resources are within a different control area. The Board of Directors approved that Truckee Donner Public Utility District assign their base resource to NCPA in an August Board meeting. NCPA accepted this LOA at their August commission meeting. New Information — The City of Fallon looked into assigning their base resource to NCPA also but since Fallon is not a member of NCPA, this became problematic. A solution to this problem is to assign the City of Fallon's WAPA base resource to Truckee Donner Public Utility District. This would benefit both the District and the City of Fallon. Truckee Donner Public Utility District and the City of Fallon with input from WAPA and NCPA have drafted the attached Letter of Agreement for Assignment Administration (LOA). Also attached is the process that WAPA will follow in order to complete the assignment. Recommendation — 1 recommend the Board approve the Board President to sign in substantially the same form, the Letter of Agreement enabling the District to accept assignment of the City of Fallon's Base Resource Entitlement and other WAPA contract and exhibits as required. September 10, 2004 Draft Mayor Ken Tedford Jr. City of Fallon 55 West Williams Ave Fallon, NV 89406 SUBJECT: The Assignment of the City of Fallon's Base Resource Percentage to Truckee Donner Public Utility District Dear Mr. Tedford: As a member of the Utah Associated Power Association (DAMPS), the city of Fallon will be entering into Contract 00-SNR-000 (Assignment Contract), dated Month 00, 2004, whereby Western will assign the City of Fallon's Base Resource Entitlement(BRE) under this contract to the Truckee Donner Public Utility District(TDPUD). Concurrently, by a Letter of Agreement dated Month ##, 2004, and as a member of both DAMPS and the Northern California Power Agency (NCPA), TDPUD has assigned its Base Resource Percentage(BRP) to NCPA under terns substantially similar to those detailed below in order for TDPUD, as a member of NCPA, to create a power resource portfolio for the mutual benefit of qualified NCPA members beginning January 2005. Therefore, having the necessary contractual arrangements in place with NCPA, Truckee Donner Public Utility District has agreed to accept assignment of the City of Fallon's Base Resource Entitlement, and will administer the Assignment Contract for the mutual benefit of TDPUD and the City of Fallon according to the ferns of this Letter of Agreement for Assignment Administration (LOA). More specifically, Truckee-Donner PUD will: 1) Track the amount of all energy deliveries to, or on behalf of City of Fallon made under the Assignment Contract; 2) Deliver or cause to be delivered to City of Fallon its energy entitlement under the Assignment Contract; 3) Account for the value of any portion of the City of Fallon's energy entitlement in that City of Fallon elects not to be directly delivered; 4) Directly pay to a third party energy provider, at the City of Fallon's direction, for all or a portion of capacity, energy, and or transportation charges associated with the delivery of electrical power to the City of Fallon. Such payments requested by the City of Fallon and paid by Truckee Donner PUD shall not exceed the City of Fallon's then current Assignment Contract account balance. Moreover, by and through its contract with NCPA, TDPUD will have at its disposal all resources reasonably available to each qualified member or through ancillary market transactions to perform the duties described above. For example, NCPA has contract/tariff transmission rights on the California ISO grid to deliver to the Sierra Pacific eontroI area at Summit. In addition, Truckee Donner PUD and the City of Fallon, as network transmission customers of Sierra Pacific Power, have contract/tariff rights to receive power at specific transmission interfaces on Mr. Tedford September 10, 2004 Page 2 of 2 Sierra Pacific's control area. Yet to ensure the efficient administration of the Assignment Contract, the City of Fallon and Truckee-Donner PUD seek to maximize scheduling flexibility and therefore agree that Truckee Donner PUD may call upon any or all of the City of Fallon's other physical resources and contractual rights to perform these duties as mutually agreed. The City of Fallon agrees to indemnify, defend, and hold Truckee Donner PUD, NCPA and each of NCPA's other qualified members, NCPA's non-participating members, and each parties' and non-parties' governing bodies, officers, agents, and employees as indemnities harmless from and against all claims, damages, losses, and expenses, including attorney's fees, arising out of or resulting from acts performed under this LOA or the corresponding Assignment Contract. Of necessity, the term of this LOA must coincide with term of the underlying Assignment Contract. More specifically, this LOA shall terminate automatically upon the termination of the Assignment Contract; and the City of Fallon shall not terminate this LOA without first obtaining the written consent of Western while the Assignment Contract is in effect. Notwithstanding termination of this LOA, any financial obligations incurred by the City of Fallon hereunder shall survive until satisfied. Should the terms of this LOA be agreeable to you please return one signed copy to Truckee Donner PUD and retain the other for your records. Sincerely, James Maass President of the Board Title Date CITY OF FALLON Mayor Ken Tedford Mayor City of Fallon Title Date Process for Assigning City of Fallon Base Resource Allocation to Truckee-Donner PUD Step 1 Fallon provides Western with a written request to have Western assign their Base Resource allocation percentage to Truckee-Donner. Step 2 Western (SNR) reviews the request to determine if an assignment is appropriate. Step 3 Western (SNR) prepares a Request for Assignment document, and provides it to both Fallon and Truckee-Donner for signature. Step 4 Fallon and Truckee-Donner execute the Request for Assignment and return it to Western for processing. Step 5 Western (SNR) prepares a memorandum to the Administrator requesting his approval of the Request for Assignment document. Step 6 If the Administrator approves the proposed assignment, the Request for Assignment is executed and dated and returned to SNR. Step 7 Western returns an original of the approved Request for Assignment document to Fallon and Truckee-Donner for their records and Western retains one original for its records. Step 8 Western revises both Fallon and Truckee-Donner's Base Resource Contract Exhibit to reflect the assignment of the Base Resource percentage i.e. Fallon's Base Resource percentage is reduced to zero and Truckee-Don nera's Base Resource percentage is increased accordingly.