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<br /> .. <br /> . <br /> CITY OF ARDEN HILLS <br /> e MEMORANDUM <br /> DATE: October 6, 1995 <br /> TO: Brian Fritsinger, City Administrator <br /> FROM: Terrance Post, City Accountant ~ <br /> Dwayne Stafford, Public Works uperinte <br /> SUBJECT: NSP Peak - Controlled Electric Service Al!reement <br /> Background <br /> Staff has been analyzing the costlbenefit factors concerning phase II of the water utility booster <br /> station alarm retrofit project. Staff has recommended going forward in three areas: (I) update <br /> telemetry equipment to the Roseville pumps; (2) operationally reconfigure the service areas of <br /> the two towers; and (3) take advantage ofNSP peak - controlled tiered rates. Staff has also <br /> recommended not going forward with more efficient replacement pumps and motors because of <br /> the extended payback period (50 years). Mr. Stafford's September 11, 1995 memo on this subject <br /> discusses these issues in more detail. <br /> . Off - Peak Implementation Requirements <br /> To accomplish the objective of benefitting from NSP's reduced off peak rate structure, the City <br /> of Arden Hills will have to formally enter into an "Electric Service Agreement for Peak - <br /> Controlled Tiered Services". This five year agreement would essentially obligate the City to <br /> control electrical loads to non-peak time limits (9:00 PM - 9:00 AM) and permit NSP up to 80 <br /> hours per calendar year of intentional interruptions of controlled demand. In return for satisfYing <br /> these contract terms, the rate per kw would drop from the current peak rate of $7.49 to $4.43 <br /> (59% rate reduction). <br /> Because of the operational changes previously referred to, complying with these service <br /> agreement requirements should cause no operational or water customer concerns, Assuming the <br /> agreement is executed, staff is estimating approximately $6,000 in annual cost savings to the <br /> - water utility. Approximately $4,000 of those savings will be from reduced kw demand and the <br /> I other $2,000 from the off-peak rate reduction. <br /> Recommendation <br /> I Staff recommends that Council consider directing staff to enter into a "Peak-Controlled Electric <br /> Service Agreement" with Northern States Power Company (NSP) under consent at the regular <br /> City Council meeting on October 10, 1995. <br /> Ie <br /> I <br /> I <br />