FROM: James D. Herberg, General Manager
Originator: Riaz Moinuddin, Director of Operations & Maintenance
SUBJECT:
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DIRECT ACCESS ENERGY PURCHASE CONTRACT - CONSTELLATION NEWENERGY, INC.
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GENERAL MANAGER'S RECOMMENDATION
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RECOMMENDATION:
Approve Master Service Agreement with Constellation NewEnergy, Inc.
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BACKGROUND
In 2009, California Senate Bill 695 established the Direct Access (DA) program, a retail electric service that allows customers to purchase electricity from a competitive provider, called Electric Service Providers (ESP), instead of from a regulated electric utility. The utility delivers the electricity that the customer purchases from the ESP over its distribution system and collects a fee for doing so.
Orange County Sanitation District (OC San) transferred its major treatment plant accounts to the DA program starting in January 2022. OC San was able to transfer its remaining accounts (pump stations and various treatment plant buildings) starting in April 2022.
When the Board approved the DA program participation in December 2021, staff was directed to initiate the procurement of a long-term purchase agreement for continuation of service for Board approval by June 30, 2022. Statements of Qualifications were received from three energy providers on March 18, 2022. The submittals were reviewed for completeness and the proposed forms of contract were reviewed by OC San's legal counsel. All three proposers were found responsive and qualified to provide service. In May 2022, the Board authorized entering into Master Agreements with all three proposers.
RELEVANT STANDARDS
* 24/7/365 treatment plant reliability
* Ensure the public's money is wisely spent
PROBLEM
The DA electricity market is very dynamic, and costs are currently at higher-than-normal levels. One of the three vendors, Constellation NewEnergy, Inc. has requested minor changes to contract terms. Executing this third Master Agreement with a ...
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