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2016-01-26_PWETC_AgendaPacket
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2016-01-26_PWETC_AgendaPacket
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Public Works Commission
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Agenda/Packet
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1/26/2016
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Regular
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262 which would be addressed in the PPA, such as if the city chose a 6 -month <br />263 annualization payment to avoid more disparity and allow for easier management; <br />264 and lower wintertime output at highest point of usage and how that impacted the <br />265 overall cost. <br />266 As an example of credit reconciliation, Mr. Kroll reviewed advised that the OVAL <br />267 energy rate was calculated on the size of the system, not how much it produced that <br />268 would remain the same every month. Mr. Kroll advised that for ten months, the <br />269 City would receive a credit, and could choose which two months of the year they <br />270 set as their "demand holiday" to receive a discount on the full demand load. Since <br />271 the OVAL has very high usage in the winter time, in a traditional scenario, Mr. <br />272 Kroll suggested the city could strategize to set its demand holiday for the highest <br />273 usage months to receive money off the entire demand load and establish standby <br />274 service. However, Mr. Kroll advised he was still checking with Xcel Energy to <br />275 determine their flexibility with that and to make sure the reality of that option would <br />276 actually play out, with more resear h to be complete,„d n his part to finalize <br />277 numbers as accurately as possible.. <br />278 <br />279 At the request of Member Seigler, Mr. Kroll responded that if the solar system <br />280 produced more energy than it consumption realized, it would be sold on the grid <br />281 and metered accordingly. However, Mr. Kroll opined it would be unlikely that the <br />282 city would ever reach that limitatiqqkflor receiving a credit back. Mr. Kroll advised <br />283 that their design engineers were conscious of the need to design it based on <br />284 constraints of the demand charges and usage to best maximize what the city <br />285 received and use the rest for the arena. Mr. Kroll noted that the arena used way <br />286 more energy than balanced on the system, but the goal was to maximize the overall <br />287 profitability of the system between the two meters as'much as possible and utilize <br />288 the available space on the roof Mie. Kroll noted that the size and design of the <br />289 system would allow more detailed finalized numbers to determine performance <br />290 curves and profitability as would be detailed on the PPA schedules. <br />291 <br />292 urther discussion ensu the purchase options in this scenario; how the actual <br />293 ula and credits were ined; language of the standby tariff as written and <br />294 re ements for Xcel nergy o at a minimum allow the city with a limited amount <br />295 of credits on a certain percentage of KWh or negotiated limitation on the system <br />296 size to demand profile depending on how Mr. Kroll was able to vet that out with <br />297 Xcel before finalizing the PPA for review and consideration by the PWETC and <br />298 City Council°"011IIIIIII��� <br />299 <br />300 Mr. Kroll advised that the next step was 1) to receive the go-ahead from the city for <br />301 the project; and 2) for lawyers on both sides to review contract language of the PPA <br />302 after which they could begin the design process of working with Xcel Energy to <br />303 design the system for the city to compare with cash flows prior to signing the <br />304 contracts. Once signed, Mr. Kroll advised that their firm would then begin the <br />305 actual engineering specifications available for the system. Due to the expense of <br />306 the engineering and design process, Mr. Kroll noted that that work was done after <br />307 contracts were signed. <br />Page 7 of 18 <br />
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