HomeMy WebLinkAboutAgenda Packet 03/28/2011V. Next Meeting Date: April 12, 2011
VI. Adjournment
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City Council Special Meeting /Utility Advisory Committee
Jack Pittis Conference Room
Port Angeles, WA 98362
March 28, 2011 3:00 PM
AGENDA
I. Call To Order
11. Roll Call
III. Executive Session
Potential Litigation: RCW 42.30.1100)0)
IV. Discussion Items:
A. Bonneville Power Administration Residential Exchange Program
Settlement Agreement
pORTANGELES
W A S H I N G T O N U. S. A
Utility Advisory Committee Memo
Date: March 28, 2011
To: Utility Advisory Committee
From: Larry Dunbar, Deputy Director of Power Systems
Subject: Bonneville Power Administration Residential Exchange Program Settlement Agreement
Summary: A settlement agreement has been offered for City Council consideration regarding the
Bonneville Power Administration's Residential Exchange Program.
Recommendation: Formulate a recommendation to City Council.
Background /Analysis: A settlement agreement has been offered for City Council
consideration regarding the Bonneville Power Administration (BPA) Residential Exchange
Program (REP). The proposed settlement agreement is complex and a significant issue for the
Electric Utility. Every decision about the settlement agreement, regardless what the decision is,
will affect future wholesale power costs for the next seventeen years.
On March 23, 2011, an evening workshop was held and presentations were made by the Western
Public Agencies Group (WPAG) and the BPA. The workshop provided background information
on REP and outstanding litigation, and a summary of the advantages and disadvantages of the
proposed settlement agreement.
Based on the most current information from WPAG and BPA, there are dozens of possible
scenarios that might be considered. However, for purposes of formulating a recommendation to
City Council, it does not appear helpful to focus on the possible, but unlikely, outcomes.
Nonetheless, even the likely circumstances provide at least three alternative responses to the
settlement agreement. These include:
1. We do not approve of the settlement agreement.
2. We approve of the settlement agreement. It is important that the City sign it, so that the
City will be included in the benefits it offers.
3. We should wait until it is clear that the settlement agreement will (or will not) be approved
by 91% of public power before we act to approve or disapprove the settlement agreement.
N: UACFinal BPA Residential Exchange Program Settlement Agreement.docx
March 28, 2011
Bonneville Power Administration Residential Exchange Program Settlement Agreement
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In considering these choices, one bit of information missing from the workshop presentations was
the financial impacts of the likely outcomes on the City and its rate payers. We will have a
financial summary available for your review on Monday for the following two comparisons:
A. Based on the status quo compared to the settlement agreement.
B. Based on the status quo compared to the most likely litigation outcome.
We will also provide the nominal annual average and 17 -year total cost savings for the two
comparisons (not adjusted for inflation, wholesale rate adjustments, changes in energy purchases,
etc.). The financial summary will include the overall Electric Utility, and be broken down for the
distribution system, industrial transmission system, and residential rate class on Monday.
There are advantages and disadvantages of a decision to accept or reject the settlement agreement
if it prevails. Staff will be ready to answer questions, and Mr. Terry Mundorf will be available by
phone.