AGENDA MEMORANDUM

 

 

Meeting Date:           July 14, 2008

 

From:                          Paul Kalv, Director of Electric Department

 

Subject:                      Resolution authorizing a professional services agreement with Plexus Research, a division of R. W. Beck, Inc. for Advanced Metering Infrastructure (AMI) consulting services.

 

 

Staff Recommendation:

Staff recommends approval of a professional services agreement with Plexus Research for an amount not to exceed $90,000 plus estimated travel related expenses not to exceed $8,000.

 

Analysis:

Consideration for the deployment of an advanced metering infrastructure (AMI) is arguably the third most important decision in the history of the utility, preceded only by formation of the utility itself and the decision to join with other Florida municipal utilities in the formation of the Florida Municipal Power Agency (FMPA.)  Should AMI be deployed, the business model for the electric utility will change dramatically.  The electrons will still flow through the network, and lights, TVs, motors, appliances will still turn “on” and “off” at the flip of a switch, and AMI is expected to improve the electric, water, and gas meter data collection processes and provide a variety of other improvements to utility business services and operations.

 

Given the extreme volatility in the cost of fuel seen today and given the higher base cost of generation that is projected when the volatility subsides, staff believes Leesburg needs to partner with our electric customers by providing options to mitigate the higher cost of electricity.  These options can be provided through time-based rates and load control to encourage and enable shifts in power usage from higher cost to lower cost hours.  Customers must be informed and empowered to make their electric purchasing decisions with full knowledge of the costs and alternatives that meet their needs.

 

During the Commission workshop held on May 29, 2008, staff discussed the rapidly rising cost of our power supply provided by FMPA and the opportunity to significantly reduce that cost by reducing our peak hour demand, alternative rate structures enabled by AMI to encourage customers to shift the use of electricity to lower cost hours, and other operational benefits enabled by the two-way communication technology between the utility meter and the utility that will result in a significant reduction in the need to actually visit the meter in the field, among other benefits.

 

Staff is convinced the recommendation to deploy an AMI network is the right move to make at this time for the benefit of the utility and for the benefit of our customers.  Numerous deployments by other utilities throughout the U.S. have shown that customers will reduce power use during high cost time periods that result in cost savings for themselves and for the utility.

 

The benefits and expenses to the utility that surround a decision to move forward with an AMI technology deployment are very utility specific; capabilities of AMI equipment are increasing and costs are decreasing as more larger utilities are moving forward with massive deployments.  During the workshop, staff asked for the support from the Commission to move forward with a professional evaluation in the form of a Feasibility Study and Business Plan.

 

During the past month, staff has held lengthy and detailed discussions with two consultant firms that have the basic capability to provide the level of assistance that Leesburg requires.  One firm has significantly greater capability, significantly greater knowledge and experience working with numerous large investor owned utilities as well as municipal utilities, and brings certain additional capabilities that will be useful not only in the evaluation of the feasibility but also in the development of the AMI requirements that would be used as the basis for an RFP, if the decision was made to move forward with a deployment.

 

Staff recommends Plexus Research, a division of R. W. Beck, Inc. (Plexus Research) be awarded the contract to perform the study as provided in the professional services agreement and the Exhibit A Scope of Services to assist Leesburg in preparing a high-level AMI business case.  The business case will include the anticipated benefits and costs to deploy AMI where electric, gas, and water retail services are provided.  The business case will incorporate major DSM program elements and assumptions already developed by Leesburg Electric Department management.  In addition to the project deliverables specifically outlined within this Scope of Services, the high-level AMI business case will provide Leesburg management the following:

 

§  Key elements of an AMI action plan that is consistent with Leesburg’s business strategy.

 

Options:

1.  Approve the agreement with Plexus Research, a division of R. W. Beck, Inc.

2.  Such alternative action as the Commission may deem appropriate

 

Fiscal Impact:

A budget adjustment has been processed to move the funds from 041-1062-531-3130 for this amount not to exceed $98,000.00.

 

Submission Date and Time:    7/9/2008 3:09 PM7/9/2008 11:55 AM____

 

Department: __Electric______________

Prepared by:  ___Paul Kalv_______                      

Attachments:         Yes__X_   No ______

Advertised:   ____Not Required ___X___                     

Dates:   __________________________                     

Attorney Review :       Yes_X__  No ____

                                                 

_________________________________           

Revised 6/10/04

 

Reviewed by: Dept. Head _Paul Kalv__

 

Finance  Dept. _________ _JB_______                                     

                              

Deputy C.M. ___________________                                                                         

Submitted by:

City Manager ___________________

 

Account No. _041-1021-531-3410_ _

 

Project No. __419230______ _____

 

WF No. ______________________

 

Budget  _____ $98,000__   _______

 

Available ___ _$98,000_______  __

 

RESOLUTION NO._______________

 

A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A PROFESSIONAL SERVICES AGREEMENT WITH PLEXUS RESEARCH, A DIVISION OF R. W. BECK, INC. FOR ADVANCED METERING INFRASTRUCTURE (AMI)CONSULTING SERVICES; AND PROVIDNG AN EFFECTIVE DATE.

 

BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA:

 

            THAT the Mayor and City Clerk are hereby authorized to execute an agreement with Plexus Research, a division of R. W. Beck, Inc. whose address is 1000 Legion Place, Suite 1100, Orlando, FL 32801, for Advanced Metering Infrastructure (AMI) consulting services.

 

             THAT this resolution shall become effective immediately.

 

PASSED AND ADOPTED by the City Commission of the City of Leesburg, Florida, at a regular meeting held the 14th day of July, 2008.

 

 

 

                                                                            __________________________

                                                                             Mayor

 

ATTEST:

 

 

__________________________

City Clerk