Resolution 14335CITY OF ALAMEDA RESOLUTION NO. 14335
APPROVING AMENDMENT NO. 1 TO THE LONG-TERM POWER PURCHASE
AGREEMENT BETWEEN IBERDROLA RENEWABLES, INC. AND ALAMEDA
MUNICIPAL POWER
WHEREAS, Alameda Municipal Power (AMP) entered into a long-term
power purchase agreement (PPA) with Iberdrola Renewables, Inc. (Iberdrola),
dated as of December 14, 2004, for the purchase of renewable energy produced
by wind turbines at the High Winds facility located in Solano County, California;
0 and
WHEREAS, the term ofthe PPA is for a period beginning January 1, 2005
through June 30, 2028; and
WHEREAS, on April 1, 2009, the California Independent System Operator
(CAISO) implemented a comprehensive restructuring of the wholesale electricity
market in the state, referred to as the Market Redesign and Technology Upgrade
(MRTU) initiative; and
VVHEREAS, implementation of MRTU changes the manner by which
bilateral power purchase agreements, such as AMP's High Winds PPA, are
scheduled and financially settled in the CAISO balancing authority area; and
WHEREAS, as a result of MRTU, load serving entities that purchase
power through PPAs can incur two separate charges: (i) a Day Ahead energy
charge for the purchase of energy to serve load from the CAISO's Day Ahead
Market, and (ii) the PPA contract rate that is due to the seller of the PPA energy;
and
VVHEREAS, in order to mitigate this cost exposure to buyers/load serving
entities, the CAISO has created a settlement mechanism for bilateral power
transactions referred to as Inter-SC Trades; and
WHEREAS, among other things, the use of Inter-SC Trades will result in a
credit to AMP from the CAISO that will correct for the double charges that can be
incurred by buyers/load serving entities arising from bilateral transactions
scheduled in CAISO administered markets; and
WHEREAS, in order to bring the High Winds PPA into conformance with
MRTU's resource scheduling protocols and to require the use of Inter-SC Trades
by Iberdrola and the Northern California Power Agency (NCPA), AMP's
scheduling agent, an Amendment to the PPA is needed to reflect these new
market features; and
WHEREAS, in anticipation of the April 1, 2009 implementation date of
MRTU, staff from AMP and Iberdrola worked together to negotiate Amendment
No. 1 language; and
WHEREAS, staff from AMP and Iberdrola were not able to finalize
negotiations for the Amendment in time to secure necessary approvals from the
Public Utilities Board and City Council prior to the fixed implementation date of
MRTU; and
WHEREAS, AMP and Iberdrola entered into a letter agreement dated
March 26, 2009, providing for the use of the resource scheduling and settlement
protocols contained in Amendment No. 1 on an interim only basis until the earlier
of July 29, 2009 or the effective date of an approved Amendment; and
WHEREAS, Amendment No. 1 is both beneficial to Alameda by reducing
AMP's cost exposure under the CAISO's MRTU framework and necessary in
order to bring the resource scheduling protocols for the High Winds PPA into
conformance with MRTU; and
WHEREAS, the Alameda Public Utilities Board has reviewed and
approved the amendment and recommends that the City Council ratify its action
as required by City Charter Section 12-2(A).
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Alameda
that:
The Council ratifies the action of the Public Utilities Board approving
Amendment No. 1 to the Long-Term Power Purchase Agreement
between lberdrola Renewables, Inc. and Alameda Municipal Power,
2. The General Manager of Alameda Municipal Power is authorized to
execute the agreement without material change.
I, the undersigned, hereby certify that the foregoing Resolution was duly and
regularly adopted and passed by the Council of the City of Alameda during the Regular
Meeting of the City Council on the 19th day of May, 2009, by the following vote to wit:
AYES: Councilmembers deHaan, Gilmore, Matarrese, Tam
and Mayor Johnson - 5.
NOES: None.
ABSENT: None.
ABSTENTIONS: None.
IN WITNESS, WHEREOF, I have hereunto set my hand and affixed the official seal of
said City this 20th day of May, 2009.
Lara Weisiger, Ci C
City of Alameda