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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.