Title
AN ORDINANCE AUTHORIZING THE EXECUTION OF AN ENERGY PURCHASE POWER SUPPLY SCHEDULE WITH AMERICAN MUNICIPAL POWER, INC. ("AMP").
Executive Summary: In order to satisfy the City's energy requirements AMP provides power to the City of Hudson from a portfolio of energy resources. As these fixed resources do not provide the City's total power requirements, there are remaining requirements that need to be purchased. This ordinance gives AMP the ability to purchase power from third party suppliers at a negotiated price to meet the remaining requirements and keep costs as competitive as possible.
Body
Legislative History
None.
Purpose & Explanation
The City of Hudson receives its power from American Municipal Power, Inc (AMP). As such, the City has also participated in a variety of AMP energy generation projects and joint ventures. However, the portfolio projects and joint venture resources do not provide the City's total energy requirements. Therefore, there are remaining requirements that AMP must purchase off the market or from other resources. The City of Hudson's remaining requirements equate to approximately 25% of its total power needs.
Until recently, Remaining Requirements Service was not available to the City. The only alternative for hedging future market power price fluctuations was to purchase various blocks of power over various terms. With the Remaining Requirements Agreement, the City would have the option of passing on market risk to the Remaining Requirements Service provider. The provider is then required to provide the power at the agreed upon price regardless of the amount of power the City will need to meet its remaining requirements. The term of the Remaining Requirements Agreement is June 1, 2014 through December 31, 2018. The purchase price will be set at a not to exceed rate of $49.00 per MWh.
Energy consultant John Courtney of Courtney and Associates has reviewed the AMP Remaining Requirements Agreement and h...
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