Item Coversheet
City of Independence
AGENDA ITEM COVER SHEET
Approved

Agenda Title:

Council action is requested to enter into an agreement (309-18) with Tenaska Power Services Co. for Energy Services and Energy Data Management for the Power & Light Department. The initial period will be April 1, 2018 through June 30, 2019 with seven, one year renewal periods. Expenditures will not exceed budgeted amounts.
Recommendations:

Council action to enter into an agreement.
Background:

Since 2009, Tenaska Power Services Co. (TPS) has provided the City’s Power & Light Department (IPL) with various energy services. TPS delivers highly-technical information, consultation and support within the SPP energy markets and our past experience with TPS has provided them with an intimate understanding of our operations, objectives and opportunities. Specifically, IPL utilizes their proprietary market tools to submit energy purchases/sales, monitor market conditions and settle wholesale revenues/expenses. Such tools are required in order to participate in the SPP energy market and to accurately account for wholesale transactions.

The proposed agreement seeks to extend the current contract terms and conditions held with TPS, as well as incorporate additional functionality through a Subscription Agreement. The additional functionality will allow IPL to record, approve and submit all market transactions, record and store historical energy data, and directly communicate with the SPP market in real time. TPS will be responsible for implementation including project design, management, and testing and IPL has submitted detailed expectations to satisfy all objectives.

When negotiating the terms, it quickly became clear that upon achievement of the proposed Subscription Agreement build-out, IPL could consolidate vendors, and thus, eliminate a service that annually costs IPL over $152,000. In an effort to maximize the proposed savings, IPL staff further negotiated five additional years (at IPL’s discretion) of service at the stated contract price. As a result, IPL protects itself from price increases for eight years while laying the foundation for the department to save an estimated $1,000,000.

TPS is a single source provider based on the years of specialized service, knowledge of IPL’s operations and systems, and the proprietary market tools utilized by IPL. The Law Department, Procurement Manager and IPL staffs are in agreement on the single source status of this agreement and the significant cost savings to the City.

Department:          Power & LightContact Person:          Andrew Boatright


REVIEWERS:
DepartmentAction
Purchasing Division (Finance Department)Approved
Power and Light DepartmentApproved
Finance DepartmentApproved
Finance DepartmentApproved
Law DepartmentApproved
City Managers OfficeApproved
City Clerk DepartmentApproved

Council Action:          Council Action:          Accepted

ATTACHMENTS:
DescriptionType
Tenaska Energy Services AgreementBackup Material
Tenaska Subscription AgreementBackup Material