HomeMy WebLinkAboutres2017-028WMAT!'n]N!'n11NTVCn111WIT AGENDA R1LL NO. 2017 -163
CLEARANCES
Initial
Date
Date Received in Council O rice
Agenda Date
Ass! ned to:
Twh
05108/17
05116117
Finance
Originator:
�Q
V E D
MAY O 9 2017
WHATCOM COUNTY
COUNCIL
Council
Division Head:
Dept. Head:
Prosecutor:
/09/17
-
Purchasin /Bud et:
S /
Executive:
TITLE OF DOCUMENT.•
Agreement between Whatcom County and Puget Sound Energy for the purchase of wind power energy.
ATTACHMENTS:
Memo
Resolution I
Attachment A — Service Agreement
Attachment B — Whatcom County Account Listing
Scenario Tester — Green Direct cost schedule
PSE Electric Tariff G — Schedule No. 139
SEPA review required? ( ) Yes ( x ) NO
Should Clerk schedule a hearing ? ( ) Yes ( x ) NO
SEPA review completed? ( ) Yes ( x ) NO
Requested Date:
SUMMARYSTATEMENT OR LEGAL NOTICE LANGUAGE. (If this item is an ordinance or requires a public hearing, you
must provide the language for use in the required public notice. Be specific and cite RCW or WCC as appropriate. Be clear in
explaining the intent of the action.)
Executive Louws requests the approval of the County Council to enter into a ten year agreement with Puget Sound
Energy for the purchase of wind power through the Green Direct Program. If projections are realized, the Green Direct
Program agreement will result in cost savings for Whatcom County through a reduction in energy costs.
COMMITTEE ACTION.
COUNCIL ACTION:
5/16/2017: Forwarded to Council for approval
5/16/2017: Approved 7 -0, Res. 2017 -028 �h
I
Related County Contract #:
Related File Numbers:
Ordinance or Resolution Number:
Res. 2017 -028
Please Note: Once adopted and signed, ordinances and resolutions are available for viewing and printing on the County's website
at: ivwrv. c' o .�vhrrtronr.wa.rrslcr�rrric °il.
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PROPOSED BY: County Executive
INTRODUCTION DATE: 05/16/17
RESOLUTION NO. 2017-028
AUTHORIZING THE PURCHASE OF RENEWABLE WIND ENERGY FROM PUGET
SOUND ENERGY (PSE) STARTING IN 2019 FOR A 10 -YEAR CONTRACT TERM
WHEREAS, climate change is one of the paramount challenges of our generation;
and
WHEREAS, eleven years ago, in November 2006, Washington State voters passed I-
937, the "clean energy initiative." This legislation required energy providers to incorporate a
growing percentage of renewable sources into their energy portfolios; and
WHEREAS, on September 29, 2006 the Whatcom County Council adopted
Resolution 2006 -058 which promotes energy efficiency and the purchase of renewable
energy for government operations; and
WHEREAS, on September 11, 2007, through Resolution 2007 -141, the Whatcom
County Council adopted the Whatcom County Climate Protection and Energy Conservation
Action Plan. The Climate Protection and Energy Conservation Action Plan established goals
and priorities for reducing greenhouse emissions; and
WHEREAS, since 2007 Whatcom County has committed to the purchase of Green
Power through Renewable Energy Credits (RECs). The purchase of RECs support the
advancement of additional solar and wind -based renewable energy technology; and
WHEREAS, Puget Sound Energy (PSE) has identified a new Green Power resource
option and received approval from the Washington State Utilities and Transportation
Commission in September 2016 for Tariff Schedule No. 139 Voluntary Long Term Renewable
Energy known as Green Direct, offering renewable electricity from a Washington wind
facility that will be in operation on January 1, 2019; and
WHEREAS, this new Green Power option is available to municipal and large
commercial electricity users and was developed to help customers meet their carbon goals
at a long -term, cost - competitive price; and
WHEREAS, qualified customers can contract to purchase renewable electricity
through this option beginning in 2019 for a term of ten, fifteen, or twenty years under the
Page 1
1 service agreement approved as part of Schedule 139 and provided as Attachment A to this
2 Resolution; and
3
4
5 WHEREAS, the agreement establishes the net cost of Green Direct electricity to be
6 the price of the renewable electricity charge less a credit for the cost of conventional
7 electricity. The cost of Green Direct electricity will increase at two percent annually over the
8 term of the contract; and
9
10 WHEREAS, electricity prices are forecasted to increase by three percent annually
11 from years 2019 to 2028; and
12
13 WHEREAS, the Green Direct program is scalable, in that customers can invest in
14 the program and limit their green energy cost by enrolling individual facilities into the
15 program. Once a facility is enrolled, all of its electricity is billed through the program; and
16
17 WHEREAS, the service agreement allows Whatcom County to exit the Green Direct
18 program before the service agreement term ends, but requires payment of a termination
19 fee in an amount equal to the net cost of the remaining Renewable Energy that was to be
20 delivered to the customer under the remaining term of the service agreement; and
21
22 WHEREAS, Whatcom County is seeking the ten -year option and has identified the
23 Whatcom County Courthouse as the facility currently served with electricity supplied by
24 Puget Sound Energy in an amount consistent with the cost of the county's current Green
25 Energy financial obligation; and
26
27 WHEREAS, the actual electricity generated from the wind facility will not directly
28 supply Whatcom County facilities, but will flow to the electrical grid. Whatcom County will be
29 funding renewable energy generation equivalent to the electricity used by our enrolled
30 facilities; and
31
32 WHEREAS, the County has evaluated the cost of Green Direct electricity compared
33 to projected costs of conventional electricity over the term of the agreement based on
34 overage annual price increases for electricity purchased from Puget Sound Energy and found
35 that the risk of higher incremental cost over the term is minimal and is offset by the
36 benefits of certain pricing for electricity supply and substantial, cost - effective progress in
37 achieving the county's commitments in the Whatcom County Climate Protection and Energy
38 Conservation Action Plan; and
39
40 WHEREAS, the term of this agreement, through 2028, extends beyond current
41 budget appropriation authorized by the Whatcom County Council.
42
43 NOW, THEREFORE, BE IT RESOLVED, that the purchase of renewable electricity
44 under the Green Direct program offered by Puget Sound Energy for a ten -year term
45 advances the county's renewable energy and greenhouse gas emission reduction goals
46 adopted as part of Whatcom County's Climate Protection and Energy Conservation Action
47 Plan.
48
49 BE IT FURTHER RESOLVED, that the Whatcom County Executive is hereby
50 authorized to execute the service agreement for the purchase of renewable electricity with
Page 2
Puget Sound Energy substantially in the form of Attachment A to this resolution for a term
of ten years beginning in 2019 for Whatcom County accounts.
ADOPTED \��ja i:WA, day of May , 2017.
1. ///
'( 0 r
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CO
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Dana.Bro;vnlr �r�1 Cie rk,, the Council
WHATCOM COUNTY WASHINGTON
APPROVED AS TO FORM:
9wal U. 44�
Chief Civil Deputy Prosecutor
WHATCOM COUNTY, WASHINGTON
(4 4
a�ryuchananr Council Chair
Page 3
WN U -60
Issued: August 1, 2016
Effective: September 30, 2016
Attachment "A" to Schedule 139, Page 1
PUGET SOUND ENERGY
CONTRACT NO.
� 017o 5023
SCHEDULE 139
VOLUNTARY LONG TERM RENEWABLE ENERGY SERVICE AGREEMENT
Attachment "A" — Service Agreement
THIS SCHEDULE 139 VOLUNTARY LONG TERM RENEWABLE ENERGY SERVICE
AGREEMENT ( "Service Agreement "), dated as of the , is made and entered into
by and between Whatcom County (the "Customer ") and PUGET SOUND ENERGY, a Washington
Corporation, (the "Company "), for service under the Company's Electric Tariff G Schedule 139. Terms
defined in Schedule 139 and in the General Rules and Provisions (Schedule 80) of the Company's tariff
for electric service shall have the same meanings where used in this Agreement.
RECITALS
A. The Company is a public service company engaged in the sale and delivery of electric energy
pursuant to its Electric Tariff G.
B. Customer is receiving Electric Service under the Company's Electric Tariff G, Schedule 24, 25,
26, 31, 40, 43, 46 or 49, and desires to participate in the Company's Voluntary Long Term
Renewable Energy program offered under Schedule 139.
C. The Company and the Customer have worked jointly to encourage the development of
Renewable Energy projects that (i) could provide clean energy to customers at a long -term
contracted rate, (ii) support the local economy, and (iii) could be publicized and leveraged for
external benefit. The Parties agree that the Wind —10 Year (the "Resource Option ") should meet
these criteria, and the Parties thus now agree to enter into this Service Agreement with each
other, for mutual benefit.
D. The Company will sell and the Customer will purchase from the Company Renewable Energy
Credits (RECs), where applicable, and Renewable Energy at a contracted volume equal to 100%
of the load of all meters located at each subscribed service address (the sum of Anticipated
Average Annual Loads) as listed in Section 5, with such amount to be allocated from Renewable
Energy generated by the Resource Option, pursuant to one of the contracted rates described.
AGREEMENT
Request and Acknowledgement. The Customer requests service under Schedule 139 and
acknowledges that Schedule 139 requires a minimum term. Service under Schedule 139 will be
billed on the Customer's existing statement. The Resource Option Energy Charge is fixed as
shown in Section 7. The Energy Charge Credit will be updated with each general rate case, power
cost only rate case or other power - related filings.
2. Resource. Under this Service Agreement the Company will receive Renewable Energy into its
Balancing Authority Area from where it can serve the Customer.
3. Renewable Energy Credits. The Company will acquire the RECs that are created with the
electricity production, where applicable. The Company will transfer the RECs to the Customer
By Authority of Order 01 of the Washington Utilities and Transportation Commission in Docket UE- 160977
Issued: August 1, 2016
Effective: September 30, 2016
WN U -60 Attachment "A" to Schedule 139, Page 2
PUGET SOUND ENERGY
which must be retired in WREGIS. Alternatively, at the Customer's request, the Company will
retire the RECs in WREGIS. As the Customer is receiving a retail product, the RECs may not be
resold or transferred to another party.
4. Resource Option.
Number: 13901 W10
Description: Large wind project in Thurston and Lewis Counties, Washington
5. Customer Service Address and Account Numbers. The Customer requests service under this
Service Agreement for the service addresses, account numbers and meter numbers listed in
Attachment B. The aggregated Anticipated Average Annual Load is included in Attachment B.
6. Term. The term of this Service Agreement shall commence in the year 2019, on the first day of
the Customer's normal billing cycle, in the first month following the commencement of commercial
operation of the Resource Option, and delivery therefrom of energy to the Company sufficient to
satisfy the obligations set forth in this Service Agreement. This Service Agreement terminates in
the year 2028 after12 billing cycles.
7. Rates. Schedule 139 rates are in addition to all charges under the Customer's existing Electric
Service schedule. Rates include a charge per kWh for the contracted energy as outlined in Table
1 and a credit for the energy - related power cost component of the Energy Charge set forth in
Schedule 24, 25, 26, 31, 40, 43, 46 or 49 of the Electric Tariff WN U -60 under which the
Customer is taking Electric Service. The Energy Charge Credit will be updated with each general
rate case, power cost only rate case, or other power - related filings, while the Resource Option
Energy Charge will remain fixed as outlined in the Table 1. below.
Table 1
Calendar Year
2019
2020
2021
2022
2023
2024 2025
Rate per kWh
$0.05111
$0.05213
$0.05318
$0.05424
$0.05532
$0.05643
$0.05756
Calendar Year
2026
2027
2028
2029
2030
2031
2032
Rate per kWh
$0.05871
$0.05989
$0.06108
NA
NA
NA
NA
Calendar Year
2033
2034
2035
2036
2037
2038
Rate per kWh
NA
NA
NA
NA
NA
NA
8, Early Exit Fee. Customers may elect to terminate this Service Agreement prior to the
Termination Date with 60 days' notice to the Company. Customers who choose to discontinue
their service under this Schedule will be charged for the net cost of the remaining Renewable
Energy that was to be delivered to the Customer under the remaining term of the Service
Agreement. This amount will be based on: 1) the remaining term of the Service Agreement, 2)
the amount of annual Renewable Energy needs ( "full requirements ") of each of the discontinued
Customer' locations as listed in Section 5 of the Service Agreement, 3) the contracted energy
rates agreed to in Section 7 of the Service Agreement, and 4) a credit for PSE's then - current
By Authority of Order 01 of the Washington Utilities and Transportation Commission in Docket UE- 160977
Issued: August 1, 2016
Effective: September 30, 2016
WN U -60 Attachment "A" to Schedule 139, Page 3
PUGET SOUND ENERGY
avoided costs (filed consistent with WAC 480 - 107 -055). Termination of service under this
Schedule will follow receipt and processing of the termination request by the Company.
9. Resource Option Inadequacy. If the Resource Option will not be available at the start of the
commencement year, the Customer's agreement will be delayed to align with the Resource
Option. If the Renewable Energy produced by the Resource Option and purchased by the
Company is insufficient in any calendar year to satisfy the full requirements of the Customer, the
Company will work with the Customer to source and retire for the Customer RECs from alternative
resources, with costs for the RECs limited to the net amount to be collected under Schedule 139
from the Customer for the remainder of the calendar year. If, at the Company's determination, the
Resource Option will not be adequate to meet the full requirements of the Customer, then this
Service Agreement will be terminated with no liability to the Customer or to the Company. If a
replacement project can be sourced and mutually agreed upon, a new Service Agreement will be
created.
10. Credit. Customer authorizes that the Company may run a credit report on Customer and /or
request audited financial statements for the purpose of determining the Customer's
creditworthiness for this service.
11. Energy Efficiency Services. The Customer and the Company will continue to partner on
mutually beneficial energy efficiency projects which will reduce energy demand on an annual
basis. These services will have no bearing on the cost of energy as proposed in Table 1.
12. Electrical Work. In order to ensure continued qualification for service under Schedule 139, the
Customer must contact the Company through their business account services representative
when any electrical work is being conducted.
13. Governing Law. This Service Agreement will be governed by and interpreted, construed and
enforced in accordance with the laws of the State of Washington.
IN WITNESS WHEREOF, the Parties, by their duly authorized representatives, have executed
this Agreement as of the date first written above.
PUGET SOUND ENERGY
M
Its
1A11f01 i l_?I:7
By
Its County Executive
L �& as /o911 7
By Authority of Order 01 of the Washington Utilities and Transportation Commission in Docket UE- 160977