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TO: Mayor Thomas J. Weisner
FROM: Jim Pilmer, Director of Neighborhood Standards
DATE: July 1, 2014
SUBJECT:
Requesting approval of a Resolution Authorizing the Mayor to execute electric contracts with electricity suppliers to provide electricity to the City of Aurora.
PURPOSE:
Effective with federal electricity deregulation in 2007, the city has been able to buy electricity "unbundled" from the operators of the distribution system. Good Energy, L.P. is the consultant for procuring the commodity of electricity for the Aurora electric aggregation plan. The purpose of this electricity supply contract is for city facilities that are not covered with electricity provided under the franchise agreement with ComEd.
BACKGROUND:
With deregulation, electricity is now considered a commodity. As a commodity the price changes daily. Constellation Energy is providing electricity on a final extension renewal of the current contract. The contract for the accounts expire in August 2014. Aurora has options to buy electricity from any supplier. This resolution will allow the Mayor to execute the contract to buy with the most economic supplier that meets Aurora's goals with the purchase of electricity. Good Energy, L.P. as consultant is providing Aurora the services towards the preparation of executing the electric contract by aligning suppliers with preliminary pricing which should narrow the field towards a competitive contract.
DISCUSSION:
To enable the City to obtain the lowest prices, it is again recommended that the Mayor be empowered to accept the most attractive proposals from electricity suppliers and to execute the associated supply contract at the end day of current supply sources. If the Mayor is unavailable to take these actions, the Director of Purchasing is authorized to do so. In the absence of the Director of Purchasing, the succession falls to the Chief Financial Officer/ City Treasurer.
IMPACT STATEMENT:
We are seeking the most cost effective electricity for the various city facilities. Electricity suppliers general expect their final proposals accepted or rejected on the day they are presented. This must take place during regular business hours. This is problematic for the City because the City Council meets after regular business hours. If we wait for the City Council to formally accept proposals at one of its regular meetings, suppliers would add a contingency to their pricing because the sale could not be finalized until the next business day. Consequently, the City would not receive the lowest prices possible.
RECOMMENDATIONS:
That the City Council approve the attached proposed resolution authorizing the Mayor to execute contracts with electricity suppliers to provide electricity to the City government at the expiration of current electric supply contracts.
cc: Alderman O'Connor, Chairman
Alderman Mervine
Alderman Bohman
Alderman Peters, Alternate
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
title
A Resolution Authorizing the Mayor to execute contracts with electricity suppliers to provide electricity to the City of Aurora
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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, (Illinois municipalities were afforded the opportuntiy to purchase electricity from any one of the multiple electricity suppliers in the market place effective January 1, 2007; and
WHEREAS, the City is currently soliciting competitive proposals from electricity suppliers due to the expiration of the current contracts in August 2014; and
WHEREAS, the City expects that it will be necessary to accept proposals of the most competitive firms and execute any associated contracts the same day the proposals are submitted.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows:
SECTION 1: That, pursuant to the solicitation of competitive proposals to provide electricity to City-owned properties beginning in August 2014, the Mayor is hereby authorized to accept those proposals deemed to best meet the City's electricity needs and to execute all related contracts for the provision of said electricity to City-owned properties.
SECTION 2: That in the absence of the Mayor, the Director of Purchasing is authorized to take the actions described in Section 1 above.
Section 3. If any section, paragraph, clause or provision of this Resolution shall be held invalid, the invalidity thereof shall not affect any other provision of this Resolution.
Section 4. All ordinances, resolutions, motions or orders in conflict with this Resolution are hereby repealed to the extent of such conflict.
PASSED AND APPROVED on ______________.
AYES ____ NAYS ____ NOT VOTING ____ ABSENT ____
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Alderman Bohman, Ward 1 Alderman Garza, Ward 2
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Alderman Mesiacos, Ward 3 Alderman Donnell, Ward 4
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Alderman Peters, Ward 5 Alderman Saville, Ward 6
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Alderman Hart-Burns, Ward 7 Alderman Mervine, Ward 8
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Alderman Bugg, Ward 9 Alderman Johnson, Ward 10
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Alderman Irvin, At Large Alderman O'Connor, At Large
ATTEST:
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City Clerk Mayor
Good Energy, L.P. preliminary pricing document for City of Aurora