R2008-70 AUTHORIZING CITY MANAGER TO CONDUCT AN ELECTRICITY PROCUREMENT AND EXECUTE A CONTRACT

Home Browse Search

� ' � • . FINANCIAL MANAGEMENT DEPARTMENT #2008-58 Date: May 13, 2008 To: Honorable Mayor and City Council From: John A. Smith, Interim City Manager Ron E. Neufeld, Finance Director i Subject: REQUEST FOR PROPOSAL- ELECTRICITY SUPPLY SERVICES Introduction In 1998 the State of Illinois passed legislation to deregulate electricity supply services. The Legislature delayed the implementation of the deregulation process until January 2007. Final regulations were issued in September 2006 permitting customers to select a third party supplier to provide electricity supply services. Ameren would continue to be the distribution service provider for all customers in their franchise territory. If a customer did not select a supplier, Ameren was required to provide electricity supply services as the default provider. Ameren established rules to manage the transition process in 2006. Large accounts on primary service like the City of Decatur South Water Treatment Plant located at 1155 S Martin Luther King Jr. Drive were required to select a supplier by January 1, 2007 or remain with Ameren on the hourly default rates until May 2008. In November 2006 the City staff determined that a Request for Proposal should be issued for services to begin January 2007. Request for Proposal-December 2006 The City of Decatur issued a Request for Proposal in November 2006 to select a supplier for the largest of the City accounts. The City selected Constellation New Energy as the supplier. The rate contracted was on average one cent lower that the default rates charged by Ameren effective January 2007. The accounts included in the bid were: