FROM: Robert Thompson, General Manager
Originator: Riaz Moinuddin, Director of Operations & Maintenance
SUBJECT:
title
MASTER RETAIL NATURAL GAS SUPPLY AGREEMENTS, SPECIFICATION NO. C-2023-1400BD
end
GENERAL MANAGER'S RECOMMENDATION
recommendation
RECOMMENDATION: Recommend to the Board of Directors to:
A. Approve and authorize the General Manager and Purchasing Manager to enter into Master Retail Natural Gas Supply Agreements, in a form approved by General Counsel, for the purchase of Natural Gas, per Specification No. C-2023-1400BD, with:
* Constellation NewEnergy - Gas Division, LLC, and
* Direct Energy Business; and
B. Delegate and authorize the General Manager and Purchasing Manager to enter into a long-term Transaction Agreement, in a form approved by General Counsel, with one of the following natural gas providers:
* Constellation NewEnergy - Gas Division, LLC, or
* Direct Energy Business
body
BACKGROUND
Orange County Sanitation District (OC San) Central Generation (CenGen) facilities at Plant Nos. 1 and 2 are vital to OC San's resource recovery and reliable operation. CenGen engines utilize process digester gas to generate electricity and heat which is used in the treatment plants and support buildings.
Natural gas is used as a supplemental fuel in the CenGen engines during routine operations and peak power months to reduce electrical demand. Natural gas is purchased as a bulk commodity from a third-party energy marketing firm and is delivered through regional pipelines owned by Southern California Gas Company. OC San has budgeted $1,436,000 for fiscal year 2023-2024 for the purchase of natural gas for the treatment plants.
RELEVANT STANDARDS
* Use all practical and effective means for resource recovery
* Ensure the public's money is wisely spent
* Maintain a culture of improving efficiency to reduce the cost to provide the current service level or standard
PROBLEM
OC San currently buys natural gas on the open m...
Click here for full text