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TO: Mayor Richard C. Irvin
FROM: Christopher Minick, Chief Financial Officer
DATE: March 30, 2022
SUBJECT:
A resolution authorizing the Chief Financial Officer to execute an agreement with an electricity supplier to provide electricity to various city facilities and street lighting not covered under the ComEd Franchise Agreement.
PURPOSE:
To obtain the City Council's approval to authorize the Chief Financial Officer to execute an agreement resulting from a reverse auction conducted by the city's electricity consultant, Progressive Energy Group. It is necessary to execute the contract before close of business on the day of the reverse auction. The reverse auction is targeted for the first week in May 2022.
If the Chief Financial Officer is unavailable to confirm a contractual agreement, the Director of Purchasing is authorized to do so.
BACKGROUND:
MP2 Energy provides electricity to nearly 74 accounts/city facilities not covered under the current ComEd Franchise Agreement, with a contract expiring June 1, 2022 and 20 accounts for street lighting, with contracts expiring February 1, 2023. The City has historically used the services of a consultant to obtain bids from electricity suppliers. Progressive Energy Group was contracted in October 2019 to provide these services. They will continue to review and identify renewal opportunities. The bids include an array of sourcing options: i.e. duration of commitment, percentage green energy, percentage blended energy.
The city must choose their preferred options and enter into a contract prior to close of business the day of the auction.
DISCUSSION:
Electricity is a commodity in which the price changes daily. Long term agreements are priced to offset market risks. The percentage of green energy influences price. Should the city choose to delay entering an agreement at the conclusion of the reverse auction, proposers would increase price to offset their risk.
Attached are the estimated rates currently avai...
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