AGENDA MEMORANDUM

 

 

Meeting Date:           June 8, 2009

 

From:                          Paul Kalv, Electric Director   

 

Subject:                      Resolution authorizing the Proposed Load Reduction Credit Rider

 

 

Staff Recommendation:

Staff recommends the City Commission favorably consider the proposed strategy and the development of a Load Reduction Credit Rider rate option available for customers taking service under the General Service – Demand rate schedule.

 

Analysis:

Expanding on the previously approved use of existing City-owned emergency generation to reduce the “demand” component of our monthly FMPA power supply costs, the use of customer-owned generation provides the same opportunity to lower the City’s power supply costs. Staff proposes to partner with customers that have and would be willing to operate existing customer-owned emergency generation during high demand periods to reduce our monthly FMPA power supply costs and the savings would be shared with the customer whose actions created the power supply cost savings.

 

Options:

1.  Approve the proposed development of a Load Reduction Credit Rider; or,

2.  Such alternative action as the Commission may deem appropriate

 

Fiscal Impact: 

Variable power supply cost savings depend upon actual load reduction and FMPA adjusted rates.

 

Submission Date and Time:    6/4/2009 8:10 AM____

Department: _Electric_______________

Prepared by:  _Sabrina Hubbell________                     

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. _________________

 

Project No. ___________________

 

WF No. ______________________

 

Budget  ______________________

 

Available _____________________

 

RESOLUTION NO._______________

 

A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA, AUTHORIZING DEVELOPMENT OF A LOAD REDUCTION CREDIT RIDER RATE OPTION AVAILABLE FOR CUSTOMERS TAKING ELECTRIC SERVICE UNDER THE GENERAL SERVICE - DEMAND RATE SCHEDULE; AND PROVIDING AN EFFECTIVE DATE.

 

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

 

            THAT the City Commission hereby authorizes staff to develop a “Load Reduction Credit Rider” rate option available for customers taking service under the General Service - Demand rate schedule.

 

             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 _8th ___ day of _June___, 2008.

 

 

 

                                                                            __________________________

                                                                             Mayor

 

ATTEST:

 

 

__________________________

City Clerk

 

 

 

 

Draft Load Reduction Credit Rider

Rider LRC-1

 

GENERAL

 

Load Reduction Credit Rider (Rider LRC-1) is offered by the City of Leesburg (City) to a qualifying non-residential customer (Customer) that can be called upon by the City to reduce

Customer’s electrical load during the Coincident-Peak Period of certain Peak Management Days, defined below. Such load reduction will enable City to reduce its wholesale power costs from Florida Municipal Power Agency (FMPA). This rider enables the City to share a portion of the wholesale power cost savings with Customer by applying a Monthly Load Reduction Credit to Customer’s electric bill, under the terms and conditions described below.

 

AVAILABILITY

 

Rider LRC-1 is available only to a non-residential customer that meets all of the following criteria:

1. Customer is currently served under the following non-residential rate schedule with a non-coincident monthly billing demand: General Service – Demand (GS-D)

2. Customer has a monthly peak demand of at least 100 kW during at least three months of a twelve month period; and

3. Customer is able to reduce its electrical load during the Coincident-Peak Periods when called upon by the City.

 

APPLICATION FOR RIDER

 

Customer must make an initial written application to City in order to begin receiving credits under Rider LRC-1. In determining whether to approve the application of Customer, City may consider the number of customers already being served under the rider, City’s expected power cost savings under the FMPA Wholesale Rate, anticipated changes in City loads, effects of other load management programs, and any other considerations deemed important by the City. City is under no obligation to approve applications for credits under Rider LRC-1.

 

TERM OF RIDER

 

The initial term of Rider LRC-1 shall begin October 1, 2009 and end on September 30, 2010.

Commencing October 1, 2010, and annually thereafter, Rider LRC-1 shall automatically renew for one (1) year increments, provided, however, that either the Customer or the City may terminate Rider LRC-1 effective on or after October 1, 2010, by giving written notice to the other party at least sixty (60) days prior to any such termination date.

 

REDUCTION OF CUSTOMER ELECTRICAL LOADS

 

During the term of this Rider, the Customer will reduce its electrical loads during the Coincident-Peak Period on Peak Management Days, defined below through shift changes, powering down machinery, chillers and other motors or electrical loads, or exercising installed emergency generation.

 

Peak Management Days are defined as those non-holiday weekdays during which the City determines a high probability exists that the Coincident-Peak Period will occur. The following days of each calendar year are considered holidays: New Years Day, Memorial Day,

Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. In the event that any of the foregoing Holidays falls on a Saturday, the preceding Friday shall be deemed to be the Holiday. In the event that any of the foregoing Holidays falls on a Sunday, the following Monday shall be deemed to be the Holiday.

 

The Coincident-Peak Period is defined as the one hour of each month during which the maximum energy is delivered to consumers by the Florida Municipal Power Pool (FMPP).  The Coincident-Peak Period will generally occur on a Peak Management Day as follows:

June through September 2:00 PM to 6:00 PM

December through February: 7:00 AM to 9:00 AM and 2:00 PM to 6:00 PM

Remaining months: 7:00 AM to 9:00 AM and 2:00 PM to 8:00 PM

 

The Customer will determine the method of load reduction it desires to use: shift changes, equipment/operations management, or exercising installed emergency generation and the City will determine the method of notification to adequately equip the Customer with the information needed to effect load reduction.  The City will notify Customer through the process described below to reduce electrical loads only on Peak Management Days. Upon notification by the City of a Peak Management Day, Customer will take steps to reduce electrical loads during the Coincident-Peak Period.

 

NOTIFICATION PROCESS

 

The City will provide notification of Peak Management Days to the Customer by automatic signal or another method as mutually agreed. The City will use diligent efforts to provide notice to the Customer of Peak Management Days. However, the City does not guarantee that notice will be provided. The Customer will hold the City harmless in connection with its response to notification or the lack thereof.

 

DETERMINATION OF CUSTOMER PEAK DAY LOAD REDUCTION

 

For each month, City will analyze the Customer hourly metered kW loads to compute the

Customer Peak Day Load Reduction as follows:

 

1.      Determine the Customer Average Daily Non-Coincident Demand (kW) as the average of the Customer’s highest integrated clock hour kW demands on each of the Peak Management Days in the month. This computation will be made for each Peak Management Day in the month, regardless of the Customer’s action or inaction to reduce loads on those days.

 

2.      Determine the Customer Coincident-Peak Demand (kW) as Energy (kWh) delivered by the City during the Coincident-Peak Period of the one Peak Management Day on which FMPP experienced the highest average load during the Coincident-Peak Period (i.e., the basis for monthly demand charges to the City under the FMPA All Requirements Project Rate Schedule). This computation will be made for that Coincident-Peak Period, regardless of the Customer’s action or inaction to reduce loads during the Coincident-peak Period.

 

3.      Compute the Customer Coincident-Peak Load Reduction (kW) as the difference between the Customer Average Daily Non-Coincident Demand and the Customer Coincident-Peak Period Demand. The computed Customer Coincident-Peak Load Reduction shall never be less than zero.

 

ALTRNATE DETERMINATION OF CUSTOMER PEAK DAY LOAD REDUCTION

 

Where Customer installed emergency generation output is metered, the Coincident-Peak Load Reduction shall be the metered generation Energy (kWh) output during the Coincident-Peak Period.

 

DETERMINATION OF MONTHLY LOAD REDUCTION CREDIT

 

The Monthly Load Reduction Credit shall be computed and applied to the Customer’s monthly

Electric bill as follows:

 

Monthly Load Reduction Credit ($) = (a) * (b). Where,

 

(a) is the Customer Coincident-Peak Period Load Reduction (kW) as defined above; and,

 

(b) is the Load Reduction Credit Rate ($/kW-month).

 

MONTHLY LOAD REDUCTION CREDIT RATE

 

The monthly Load Reduction Credit Rate ($/kW-month) will be one-half of the sum of the billing month “Current FMPA Adjusted Rates” for “Demand Charge - Capacity” and “Demand Charge – Transmission.”

 

City will revise the Load Reduction Credit Rate applicable for any month to reflect changes in the FMPA All Requirements Project Demand Charge Adjusted Rates.

 

RESPONDIBILITY FOR METERING OF CUSTOMER LOADS

 

City will install, or cause to be installed, and own the metering and associated metering equipment, communication equipment, and/or telemetry equipment required for measuring the hourly kW demands and energy of the Customer. Customer will pay all costs related to the purchase, installation, ownership, operation, maintenance, or leasing of such equipment. The metering, communications, and telemetry equipment shall meet functional specifications required by City.

 

Where appropriate to obtain meter readings, Customer shall have the right to install, maintain, and use similar duplicative metering, communication, and telemetry as check meters.  Upon request of Customer, City shall provide Customer with copies of hourly data for the kW demands of the Customer and, upon reasonable prior notice of Customer, City shall provide Customer with copies of any other data, information or reports that City acquires from or produces by the metering equipment or the check metering equipment.

 

In the event the metering equipment is inoperative due to either equipment failure, the performance of necessary maintenance, or otherwise, readings from check metering equipment, if available, shall be used, provided such check metering is functioning properly.  In the absence of meter data and data from station operating logs, City shall estimate the required data in the manner it deems practicable.

 

City and Customer shall coordinate the maintenance of metering, communication, and telemetry equipment and shall endeavor to minimize adverse effects of such maintenance on metering of the hourly demands of the Customer.

 

Adopted: _____________