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HomeMy WebLinkAboutResolution - 2021-R0264 - TTU Third Amendment PPAResolution No. 2021-R0264 Item No. 6.28 July 27, 2021 RESOLUTION WHEREAS, Lubbock Power & Light is the municipally owned electric utility of the City of Lubbock ("LP&L"); WHEREAS, on or about April 28, 2005, the City of Lubbock ("City") and Texas Tech University System ("TTUS"), entered into that certain Power Purchase Agreement ("PPA" or "Original Agreement"), providing for the sale and purchase of power to serve the TTUS facilities; WHEREAS, on or about March 5, 2018, TTUS and the City entered into that certain First Amendment to Power Purchase Agreement, Resolution No. EUB 2018-R0012, and City Council Resolution No. 2018-R0088 ("First Amendment"), amending the PPA to provide clarification related to the price of the power sold thereunder, ownership and responsibility for electric distribution and transmission assets, and other real property rights and interests; WHEREAS, on or about December 31, 2018, TTUS and the City entered into that certain Second Amendment to Power Purchase Agreement EUB Resolution No. 2018- R0102 and City Council Resolution No. 2018-RO454 ("Second Amendment"), amending the PPA, as amended, to extend the term of, and to provide a price adjustment to the PPA, as amended; WHEREAS, the Initial Term (defined therein) of the Original Agreement, as amended by the First Amendment and Second Amendment (such Original Agreement as amended by the First Amendment and Second Amendment will hereinafter be referred to as the "Agreement") expired on May 31, 2021, unless the parties effectuate an extension of the Initial Term; WHEREAS, since May 31, 2021, the parties have been operating under the Extended Term (defined therein) of the Agreement; WHEREAS, to extend the Initial Term, TTUS and the City desire to further amend the Agreement, as amended, to extend the Initial Term of the Agreement and to clarify matters related to the price adjustment; WHEREAS, the Electric Utility Board of the City of Lubbock finds that entering into the Third Amendment is in the best interest of the rate payers of Lubbock Power & Light; WHEREAS, the City and TTUS now desire to enter into the Third Amendment; NOW, THEREFORE: BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock BE and is hereby authorized to execute that certain Third Amendment to Power Purchase Agreement, by and between the Texas Tech University System, acting by and through its Board of Regents and the City of Lubbock, acting by and through its City Council and Electric Utility Board, amending that certain Power Purchase Agreement, by and between TTUS and the City, dated April 28, 2005, as amended, providing for the sale by LP&L and purchase by TTUS, of power, as more particularly described therein, said Third Amendment being attached hereto and incorporated herein as though set forth fully herein in detail, and any documents related thereto. Passed by the City Council this 27th day of July, 2021. Dan Pope, Mayor ATTEST: ljj�))c Bec y Garza, City S cr ary APPROVED AS TO CONTENT: c David McCalla, Director of Electric Utilities APPROVED AS TO FORM: Jen S it ,General Counsel LP&L Resolution No. EUB 2021-R0049 RESOLUTION WHEREAS, Lubbock Power & Light is the municipally owned electric utility of the City of Lubbock ("LP&L"); WHEREAS, on or about April 28, 2005, the City of Lubbock ("City") and Texas Tech University System ("TTUS"), entered into that certain Power Purchase Agreement ("PPA" or "Original Agreement"), providing for the sale and purchase of power to serve the TTUS facilities; WHEREAS, on or about March 5, 2018, TTUS and the City entered into that certain First Amendment to Power Purchase Agreement, Resolution No. EUB 2018-R0012, and City Council Resolution No. 2018-R0088 ("First Amendment"), amending the PPA to provide clarification related to the price of the power sold thereunder, ownership and responsibility for electric distribution and transmission assets, and other real property rights and interests; WHEREAS, on or about December 31, 2018, TTUS and the City entered into that certain Second Amendment to Power Purchase Agreement EUB Resolution No. 2018- R0102 and City Council Resolution No. 2018-RO454 ("Second Amendment"), amending the PPA, as amended, to extend the term of, and to provide a price adjustment to the PPA, as amended; WHEREAS, the Initial Term (defined therein) of the Original Agreement, as amended by the First Amendment and Second Amendment (such Original Agreement as amended by the First Amendment and Second Amendment will hereinafter be referred to as the "Agreement") expired on May 31, 2021, unless the parties effectuate an extension of the Initial Term; WHEREAS, since May 31, 2021, the parties have been operating under the Extended Term (defined therein) of the Agreement; WHEREAS, to extend the Initial Term, TTUS and the City desire to further amend the Agreement, as amended, to extend the Initial Term of the Agreement and to clarify matters related to the price adjustment; WHEREAS, the Electric Utility Board of the City of Lubbock finds that entering into the Third Amendment is in the best interest of the rate payers of Lubbock Power & Light; WHEREAS, the City and TTUS now desire to enter into the Third Amendment; NOW, THEREFORE: BE IT RESOLVED BY THE ELECTRIC UTILITY BOARD OF THE CITY OF LUBBOCK: THAT the Chairman of the Electric Utility Board of the City of Lubbock BE and is hereby authorized to execute that certain Third Amendment to Power Purchase Agreement, by and between the Texas Tech University System, acting by and through its Board of Regents and the City of Lubbock, acting by and through its City Council and Electric Utility Board, amending that certain Power Purchase Agreement, by and between TTUS and the City, dated April 28, 2005, as amended, providing for the sale by LP&L and purchase by TTUS, of power, as more particularly described therein, said Third Amendment being attached hereto and incorporated herein as though set forth fully herein in detail, and any documents related thereto. Passed by the Electric Utility Board this 20th day of July, 2021. Dan Odom, Chairman ATTEST: Stafford, Board APPROVED AS TO CONTENT: David McCalla, Director of Electric Utilities APPROVED AS TO FORM: 0\� Jenn 0 m' General Counsel LP&L Resolution No. 2021-R0264 THIRD AMENDMENT to POWER PURCHASE AGREEMENT This Third Amendment to Power Purchase Agreement ("Third Amendment"), is entered into and effective the 1 si day of August, 2021, by and between the City of Lubbock, Texas, a Texas home rule municipal corporation, acting by and through its City Council and the Electric Utility Board of the City of Lubbock (herein collectively referred to as "LP&L"), and the Texas Tech University System, a system of higher education of the State of Texas, acting by and through its Board of Regents ("TTUS"). WITNESSETH WHEREAS, LP&L and TTUS entered into that certain Power Purchase Agreement, dated April 28, 2005 (the "Original Agreement"), wherein TTUS contracted with LP&L to provide power and to define certain other rights related to same; WHEREAS, pursuant to First Amendment to Power Purchase Agreement, dated March 5, 2018, Resolution No. EUB 2018-R0088, and City Council Resolution No. 2018-R0088 (the "First Amendment"), TTUS and LP&L clarified, among other matters more particularly described therein, certain rights related to the price to be paid by TTUS for power, ownership and responsibility for electric distribution and transmission assets and other real property rights and interests; WHEREAS, pursuant to Second Amendment to Power Purchase Agreement, dated December 31, 2018, EUB Resolution No. 2018-RO102 and City Council Resolution No. 2018- Third Amendment to Power Purchase Agreement - LP&L and TTUS Page 1 R0454 (the "Second Amendment"), TTUS and LP&L extended the term and effectuated a price adjustment to the Original Agreement, as amended by the First Amendment; WHEREAS, the Initial Term (defined therein) of the Original Agreement, as amended by the First Amendment and Second Amendment (such Original Agreement as amended by the First Amendment and Second Amendment will hereinafter be referred to as the "Agreement") expired on May 31, 2021, unless TTUS and LP&L effectuate an extension of the Initial Term; WHEREAS, since May 31, 2021, the parties have been operating under the Extended Term (defined therein) of the Agreement; WHEREAS, to extend the Initial Term, TTUS and LP&L desire to further amend the Agreement, as amended, to extend the Initial Term of the Agreement and to clarify matters related to the price adjustment; WHEREAS, TTUS and LP&L now desire to further amend the Agreement, as amended, to address such matters. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, TTUS and LP&L hereby agree as follows: 1. Section 1.3 of the Agreement is hereby deleted in its entirety and replaced with the following: 1.3 Term of Agreement. Subject to the conditions set forth herein, the term of this Agreement shall be effective from July 1, 2004 (the "Effective Date") and shall remain in full force and effect until May 31, 2023 (the "Initial Term"). This Agreement shall continue after the Initial Term for up to twelve (12) successive thirty (30) day periods (any and all of which comprise the "Extended Term"), unless either party hereto shall provide notice of termination to the other Party at least five (5) days prior to the Third Amendment to Power Purchase Agreement - LP&L and TTUS Page 2 expiration of the Initial Term or the then effective thirty (30) day period of the Extended Term, as applicable. Notwithstanding this paragraph, should LP&L, acting by and through its City Council and Electric Utility Board, institute customer choice for its retail service area pursuant to Texas Utilities Code Chapter 40 prior to the end of the Initial Term, this Agreement will terminate at the expiration of thirty (30) days after LP&L customers have the right of customer choice. 2. The third and fourth sentences of Section 7.2(c) of the Agreement are hereby deleted in their entirety and replaced with the following: The kWh delivered to all LP&L customers shall be calculated by reducing by 2% the kWh delivered to LP&L's delivery points by SPS and ERCOT as shown on the Wholesale Power bills of the month immediately preceding the current billing month for Texas Tech. This reduction is an adjustment to account for line losses occurring between LP&L's point(s) of interconnection with the SPS and ERCOT systems and the delivery points of Texas Tech. The fifth sentence of Section 7.2(c) is hereby deleted in its entirety. 3. Section 7.2(d) of the Agreement is hereby deleted it is entirety and replaced with the following: The "Total Bill" means the sum of all charges actually paid by (or credited to) LP&L for purchased power. LP&L's current capacity and energy supply requirements are met through a series of power supply resources, which change over time, but may include, and are not limited to, purchase power agreements, energy blocks, congestion revenue rights, and other structures needed to procure energy in the Electric Reliability Council of Texas ("ERCOT") or the Southwest Power Pool ("SPP"), as applicable. The "kWh delivered to LP&L's delivery points" means the quantity of energy that is used by LP&L customers, which includes an adjustment to account for line losses occurring between the applicable generation location and the applicable point(s) of interconnection and LP&L. The monthly invoices and supporting documents utilized to calculate the Wholesale Power Charge shall be provided with the monthly billing. 4. Section 7.3(b) of the Agreement is hereby deleted in its entirety and replaced with the following: [INTENTIONALLY DELETED]. 5. Appendix 2 is hereby deleted in its entirety and replaced with the attached Appendix 2. Third Amendment to Power Purchase Agreement - LP&L and TTUS Page 3 6. Except as expressly amended hereby, all terms, provisions and conditions of the Agreement, as amended by the First Amendment and Second Amendment, shall remain valid and subsisting as provided. IN WITNESS WHEREOF, the parties have executed this Third Amendment by their duly authorized representatives effective as of the date first written above. CITY OF LUBBOCK, acting by and through Electric Utility Board DAN ODOM, Chairman of the Electric Utility Board Third Amendment to Power Purchase Agreement - LP&L and TTQS Page 4 APPROVED AS TO CONTENT: David McCalla, Director of Electric Utilities APPROVED AS TO FORM: Jej S , General Counsel CITY OF LUBBOCK, acting by and through City gNncil DANIEL M. POFC, Mayor of the City of Lubbock APPROVED AS TO CONTENT: a;A�_ David McCalla, Director of Electric Utilities APPROVED AS TO FORM: Jenny(4mit* jGeneral Counsel Third Amendment to Power Purchase Agreement - LP&L and TTUS Page 5 TEXAS TECH UNIVERSITY SYSTEM: Signature: GZ ,4 xawer Gary Ba nes (Aug 25, 202110:02 CDT) Email: gary.barnes@ttu.edu Title: Vice Chancellor and Chief Financial Officer Third Amendment to Power Purchase Agreement - LP&L and TTUS Page 6 Appendix 2 STATE UNIVERSITY GENERAL SERVICE Rate 16U APPLICABLE: To all State of Texas universities using more than 100,000,000 kWh per year where Customer's Installation has adequate capacity and suitable voltage are adjacent to the Premises. TERRITORY: RATE: Not applicable to temporary, breakdown, standby, supplementary, resale or shared Service. LP&L Service Territory Service Availability Charge: Demand Charge: Energy Charge: $0.00 per month per Meter $0.00 $0.012150 per kWh WHOLESALE POWER The charge per kilowatt-hour of the above rate shall be increased by CHARGE: an amount equal to LP&L's total cost of Wholesale Power for the month immediately preceding the current billing month for the Customer as delivered to all LP&L Customers including assumed system losses of 2%. The Wholesale Power Charge shall be calculated monthly by dividing (i) the amount of the Total Bill for Wholesale Power for the month immediately preceding the current billing month for the Customer including any prior month adjustments by (ii) the kWh delivered to all LP&L Customers in the month immediately preceding the current billing month for the Customer. The kWh delivered to all LP&L Customers shall be calculated by reducing by 2% the kWh delivered to LP&L's delivery points by the SPS and ERCOT systems. This reduction is an adjustment to account for line losses occurring between LP&L's point(s) of interconnection with the SPS and ERCOT systems and the delivery points of the Customer. Third Amendment to Power Purchase Agreement - LP&L and TTUS Page 7 TERMS OF PAYMENT: Payment due 30 days after bill date or as otherwise required by state law. If the 30`h day falls on a weekend or an official City of Lubbock recognized holiday, the due date will be extended until the next business day. A late charge of 1 % or as authorized by state law, whichever is greater, may be added to all bills not paid by the due date. CHARACTER OF AC. 60 hertz. Single-phase or three-phase at LP&L's available SERVICE: secondary voltage. TERMS & Service supplied under this rate is subject to the terms and conditions CONDITIONS: set forth in LP&L's General Terms and Conditions of the Tariff as approved by the City Council of the City of Lubbock and on file with the City Secretary of the City of Lubbock, as it may be amended from time to time. In the event a Customer entitled to Service under Rate 16U is a purchaser under a power purchase agreement ("PPA") with LP&L, in which the rates for Service to such Customer are provided therein, such rates payable by Customer shall be as provided in the PPA (in lieu of this Tariff), so long as such PPA shall remain valid and subsisting and enforceable against Customer. Further, in such instance, in the event of a conflict between this Tariff and the PPA, the terms of the PPA shall control. In events where a Customer purchases under a PPA and the PPA shall expire or terminate during the effective period of this Tariff, Customer shall revert to the applicable rate for each Meter as determined by usage characteristics. Third Amendment to Power Purchase Agreement - LP&L and TTUS Page 8