HomeMy WebLinkAbout000214 Original ContractCITY OF
ORTANGELES 000214 AMENDMENT 1
W A S H I N G T O N U.S.A.
City Manager's Office
September 19, 2012
Harold Norlund, Mill Manager
Nippon Paper Industries USA Co.
1902 Marine Drive
Port Angeles, WA 98363
RE: Agreement For Power Service Billing
Dear Mr. Norlund,
As you are aware, on October 1, 2011, the Bonneville Power Administration "BPA
implemented a new and untried rate design and billing method for the power sold to the City.
BPA's new rate design has fundamentally changed the way the City provides service to your
plant pursuant to the Industrial Transmission Rate.
To help avoid potential confusion or uncertainty caused by BPA's new rate structure on
September 30, 2011, Nippon and the City entered into a letter agreement. The agreement was
intended to clarify how the City's and Nippon's respective Contract Demand Quantities (CDQ)
will be used in calculating Nippon's electric bill. The agreement was extended and now will
expire at the end of September this year. We believe the letter agreement has been mutually
beneficial and may continue to be mutually beneficial. Therefore, we would like to establish
another temporary billing protocol for the bills rendered for service during the period October 1,
2012, through September 30, 2013. The protocol is set out below.
Billing Protocol
In any month in which the City's Demand as determined by BPA is less than the City's CDQ,
the City will add to Nippon's CU CDQ the positive difference, if any, between the City's CDQ
and its Demand as determined by BPA for such month when calculating Nippon's Demand
Charge for such month.
It is our intention to continue to evaluate both efficacy and the need for this billing protocol prior
to its expiration date.
(continued)
Phone: 360- 417 -4500 Fax: 360 -417 -4509 TTY: 360- 417 -4645
Website: www.atyofpa.us Email: citymanager @cityofpa.us
321 East Fifth Street P.O. Box 1150 Port Angeles, WA 98362 -0217
Agreement for Power Service Billing
Page 2 September 18, 2012
The City and Nippon intend to continue to work in good faith to realize short and longerterm
power purchase, demand response and wind integration opportunities, that may be offered by
BPA that have the potential to provide benefit to the City and Nippon, utilizing Nippon's unique
load characteristics and the City's status as a public, municipal utility.
In the event there is a change to the rates charged by the City for electricity supplied to Nippon
or to the calculation used to determine the monthly amount charged by the City for electricity
supplied to Nippon, either party may terminate this agreement.
If you find the foregoing acceptable, please sign one copy of this letter agreement and return it to
me.
Very truly yours,
CITY OF PORT ANGELES
By:
Dan McKeen, City Manager
By: 1� AfcA4A 4/ I2J/4
Y•
Harold Norlund, Mill Manager
Nippon Paper Industries USA Co.
September 21, 1 011
W A S H I N G T O N ORT NGELES
U. S A.
City Manager's Office
Harold Norlund. Mill Manager
Nippon Paper Industries USA Co.
1902 Marine Drive
Port Angeles. WA 98363
Re: Agreement For Power Service Billing
Dear Mr. Norlund
As you are aware, on October 1, 2011. the Bonneville Poster Administration
("BPA w ill be implementing a Ile \N and untried rate design and billing method for the
power sold to the City. BPA's new rate design will fundamentally change the way the
City provides service to your plant pursuant to the Industrial Transmission Rate.
It is ow belief that the transition to the new rate design could produce some
confusion To help avoid potential confusion or uncertainty, we would like to establish a
temporary billing protocol for the bills rendered for service during the period October 1.
201 1 through April 30, 2012. The proposed protocol is set out below. It should help to
avoid confusion in the preparation of the Nippon mill electric bill. It will do so by
clarifying how the City's and Nippon's respective Contract Demand Quantities will be
used in calculating Nippon's electric bill.
Billing Protocol
In any month in which the City's Demand as determined by BPA is less that the City's
CDQ. the City will add to Nippon's CU CDQ the positive difference. if any. between the
City 's CDQ and its Demand as determined by BPA for such month when calculating
Nippon's Demand Charge for such month.
It is our intention to e\ aluate both the efficacy and the need for this billing protocol prior
to its expiration date.
Finally. the City and Nippon intend to work in good faith to realize short and longer term
power purchase. demand response and wind integration opportunities. that may be
offered by BPA that have the potential to provide benefit to the City and Nippon.
utilizing Nippon's unique load characteristics and the City's status as a public. municipal
utility.
Phone 360-I1; Fax ?60 4 17 -4509 TTY 360 -417 -4645
Website• www ott, us Email crtvnlanager 4� cityotpa us
321 r:,t: F ftii Street 0 0 Box 1150 For Anonles WA 98362 -0217
City of Port Angeles
Record #000214
Page 2
September 21, 2011
If you find the foregoing acceptable, please sign one copy of this letter agreement and
return it to me.
Very truly yours,
CITY OF PORT ANGELES
By lam
Kent Myers, C Manager
Approved:
By: /I 0/Y �1i ;I
Hafdfd Norlund, Mill Manager
Nippon Paper Industries USA Co.