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TO: Mayor Richard C. Irvin
FROM: Martin S. Lyons, Chief Financial Officer
Chuck Nelson, Deputy Mayor
DATE: October 8, 2019
SUBJECT:
To obtain the City Council's approval of the attached resolution that would authorize the execution of an agreement with Progressive Energy Group (PEG), for the provision of Electricity Aggregation Services and enter into a Master Power agreement with Eligo Energy, IL, LLC.
PURPOSE:
Progressive Energy Group has a local office in Aurora, IL and will assist the City in providing an electricity aggregation program.
BACKGROUND:
The City has had two previous providers for similar services. In 2012, Good Energy was awarded the contract and retained it until 2016 when it was awarded to Tradition Energy. In these buying situations it's not uncommon to turn to an outside party with more expertise in energy trends and cost forecasting.
The Illinois Power Agency Act, Chapter 20, Illinois Compiled Statutes, Act 3855, added section 1-92 entitled Aggregation of Electrical Load by Municipalities and Counties, codified at 20ILCS3855/1-92.
In 2012, a referendum was held and approved concerning the establishment of a municipal electricity aggregation program pursuant to Public Act 96-0176. In April 2012, the City Council approved a plan of operation and governance for the program by adoption of Ordinance 12-029. The city solicited bids through the consultant to provide electricity supply aggregation to residents and small commercial businesses of Aurora in May 2012. The City aggregated once again in 2014 using the same process. However ComEd's rates decreased during this time and the City was able to terminate the agreement with supplier.
The City originally considered using PEG in early 2018, but at their own suggestion PEG stated the City should not hire them yet, due to the State of Illinois reduction in electricity rates, which in effect would eliminate savings due to aggregation at that time. PEG basically used their market knowledge and knowledge of the State regulatory environment to save the City money with no fee during this time frame.
DISCUSSION:
Specifics of 100% Renewable Aggregation program:
- Guarantees the participating residents will never pay more than ComEd
- Residents will not pay early termination if they choose to leave the program
- Continue to receive one invoice from ComEd
- Energy Supplier will purchase Renewable Energy Certificates (RECs)
- Qualifies the City of Aurora for EPA's Green Power Partnership Program
- Energy Supplier will coordinate EPA application process for the City of Aurora
PEG has provided research not only into the use of 100% Renewable energy for city residents, but also the utilization of a grant program that the City may use for either future energy related projects or for any purposes approved by the City Council. The grant program from the two energy providers listed below is paid monthly and therefore would be suitable for supporting a variety of programs or equipment purchases for City services/programs.
Eligo and MC2 Energy and have summarized the Aurora Green Grant in the table below:
|
|
MC2 Civic Contribution |
Eligo Civic Contribution |
|
100% Wind RECS (12 months) |
$300,000 |
$312,000 |
|
100% Wind RECS (18 months) |
$450,000 |
$468,000 |
|
|
|
|
|
Combination Wind and Heat Recs (12 months) |
N/A |
$356,000 |
|
Combination Wind and Heat Recs (18 months) |
N/A |
$558,000 |
Terms of the initial agreement would be for 18 months.
IMPACT STATEMENT:
Approval of this resolution will provide renewable energy sources to the residents and businesses of Aurora at no additional cost over non-renewable sources, and will provide grant funding of up to $558,000.
RECOMMENDATIONS:
The City Council approve the proposed attached resolution that would authorize the execution of an agreement with the Progressive Energy Group for the provision of electricity aggregation consulting services and authorize the use of Eligo Energy IL, LLC for the provision of 100% renewable energy to Aurora as outlined above.
cc: Finance Committee
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
title
A Resolution authorizing the execution of an agreement with Progressive Energy Group, for the provision of Electricity Aggregation Consulting Services.
body
WHEREAS, the City of Aurora has a population of more than 25,000 persons and is, therefore, a home rule unit under subsection (a) of Section 6 of Article VII of the Illinois Constitution of 1970; and
WHEREAS, subject to said Section, a home rule unit may exercise any power and perform any function pertaining to its government and affairs for the protection of the public health, safety, morals, and welfare; and
WHEREAS, the Illinois Power Agency Act, Chapter 20, Illinois Compiled Statutes, Act 3855, added section 1-92 entitled Aggregation of Electrical Load by Municipalities and Counties, codified at 20ILCS3855/1-92; and
WHEREAS, the City has deemed it to be beneficial to engage qualified consultant to assist with the implementation of an electricity aggregation program; and
WHEREAS, PEG has provided research not only into the use of 100% Renewable energy for city residents, but also the utilization of a grant program that the City may use for either future energy related projects or for any purposes approved by the City Council; and
WHEREAS, Eligo Energy IL, LLC has provided the largest Aurora Green Grant based on the City's use; and
WHEREAS, if required your last whereas statement should reference the section of code that allows your action (i.e. pursuant to Aurora Code Section 2-335(a)(3) the desired product is provided by only one source in this situation; and) )
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows: authorizing the execution of an agreement with the Progressive Energy Group for the provision of electricity aggregation consulting services and authorize the use of Eligo Energy IL, LLC for the provision of 100% renewable energy to the City of Aurora.