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HomeMy WebLinkAboutResolution - 5704 - Approves WTMPA Power Sales Contract - 11_13_1997Item #44 I� November 13, 1997 NK r RESOLUTION NO. 5704 A Resolution approving a project of the West Texas Municipal Power Agency pursuant to section 13(b) and (c) of the Power Sales Contract by and between the Cities of Lubbock, Tulia, Brownfield and Floydada and the Agency and resolving other matters incident and related thereto. WHEREAS, pursuant to the Sections 13(a) and 13 (b) of the Power Sales Contract (the "Contract") by and between the West Texas Municipal Power Agency ("WTMPA") and the Cities of Lubbock, Tulia, Brownfield and Floydada (collectively the "Cities"), the City of Lubbock, Texas ("Lubbock") received written notice of the WTMPA's intention to provide funds (through the issuance of Bonds) for the construction of a new 40 megawatt co -generation facility located at the Lubbock Power and Light Plant No. 2 (the "Project"), more specifically described in Exhibit A attached hereto and incorporated herein by reference as a part of this resolution for all purposes, and WHEREAS, in accordance with the provisions of said Contract, Lubbock is required to give the WTMPA written notice of its approval or disapproval of the Project within 60 days after receipt of such notice; and WHEREAS, after reviewing the material and information relating to the Project, including its economic feasibility, and the electric power needs of Lubbock, the City Council of Lubbock hereby finds and determines such Project should be approved and notice should be given to WTMPA of Lubbock's desire that the design and construction of the Project be commenced notwithstanding the approval or disapproval of the Project by any other Cities to the Contract; now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK, TEXAS; SECTION 1: The Project described in Exhibit A attached hereto and incorporated herein by reference for all purposes to be undertaken by WTMPA is hereby approved and the City Secretary is hereby authorized and directed forward a copy of this resolution to the WTMPA as written notice of Lubbock's approval of the Project and of Lubbock's desire that the design and construction of the Project be commenced and the Agency proceed with the issuance, sale and delivery of bonds to finance the costs of the Project notwithstanding the approval or disapproval of the Project by the Cities of Brownfield, Floydada and Tulia. Furthermore, Lubbock waives it right to receive written notice under section 13(c) of the Contract with respect to which Cities approve or disapprove the 048169E i Project and ---request such Project be undertaken and financed by WTMPA whether one or more of the other Cities disapproved the Project. SECTION 2: It is officially found, determined, and declared that the meeting at which this Resolution is adopted was open to the public and public notice of the time, place, and subject matter of the public business to be considered at such meeting, including this Resolution, was given, all as required by V.T.C.A., Government Code, Chapter 551, as amended. SECTION 3: This Resolution shall be in force and effect from and after its passage on the date shown below and it is so resolved. PASSED AND ADOPTED, this the 13th day of November, 1997. ATTEST: / ]'",I I &",& ity ecretary (City Seal) 0461693 CITYAOF LUBBOCK, TEXAS Mayor -2- EXHIBIT A A. PROJECT DESCREM—ON VnWA will be repowering existing steam units within Lubbock Power and Light's (LP&L) Plant No. 2. At present, two 22 MW units and two 11.5 MW Westinghouse non - reheat, condensing units exist at Plant No. 2. The repowering project will consist of the addition of a single combustion turbine with a heat recovery steam generator. A second combustion turbine with a heat recovery steam generator may be added shortly after the first. The design is to recognize this addition. Due to the need for this power, the first combustion turbine may be operated in a simple cycle node prior to the operation of the project in a combined cycle mode. Project design shall be based upon operation of the first combusdon turbine in either simple cycle or combined cycle mode; using steam from the Heat Recovery Steam generator to repower any of the existing steam turbines; and not using the beat recovery steam generator during low loads or to achieve better heat rates. All required facilities necessary to incorporate the proposed project into the existing electrical system will be considered part of the project including substation expansion, relaying and controls. S. FITI�7 - VVIWA will be requesting tax exempt bonds in the approximate amount of S31,500,000. Of this amount, the equipment, construction and testing costs will be approximately $28,000,000, and $3,500,000 will be used to set up a debt service revenue fund to reduce bonding costs. Interest income on the reserve fund will offset expected interest costs. Details of the expected project costs are shown in the attachment. C. WTMPA CONa ffnwENT W nOA and each of its member cities has a responsibility to meet the loads of its customers. Due to limited transmission access into this region of Texas, little if any power can be transported to assist in meeting summer loads from outside this region Within the region, limited capacity makes it difficult to secure long-term needs. New capacity as proposed by this project would provide the most efficient, environmentally acceptable, and economical power available in this region. D. ECONOMICS OF PROJECT Over the expected 35 year life of the proposed project, we expect $336,219,965 in savings as compared to buying the same capacity from others. This total amount is equivalent to 5162,999,902 in today's present value costs or an average present value savings of S4,657,140 per year. These savings increase as time passes. The expected 1999 savings are approximately $2,000,000. Details of these savings are shown in the attachment. The economics of this project are detailed in the attached model of this project All major assumptions are shown. In the opinion of WThIPA, the recommended project represents the best sad most reasonable solution to meeting our obliptions to our customers. a CERTIFICATE OF CITY SECRETARY THE STATE OF TEXAS § COUNTY OF LUBBOCK § CITY OF LUBBOCK § I, the undersigned, City Secretary of the City of Lubbock, Texas, DO HEREBY CERTIFY as follows: 1. On the 13th day of November, 1997, the City Council of the City of Lubbock, Texas, convened in regular session at its regular meeting place in the City Hall of said City; the duly constituted members of the Council being as follows: WINDY SITTON MAYOR ALEX 'TY' COOKE ) MAYOR PRO TEM RANDY NEUGEBAUER ) VICTOR HERNANDEZ ) T. J. PATTERSON ) COUNCILMEMBERS MAX INCE ) DAVID NELSON ) all of said pers were present at said meeting, except the following: N A Among other business considered at said meeting, the attached resolution entitled: "A Resolution approving a project of the West Texas Municipal Power Agency pursuant to section 13(b) and (c) of the Power Sales Contract by and between the Cities of Lubbock, Tulia, Brownfield and Floydada and the Agency and resolving other matters incident and related thereto." was introduced and submitted to the Council for passage and adoption. After presentation and due consideration of the resolution, and upon a motion being made by Councilmember Hernandez and seconded by CnnnrilmPmhPr PnttPrcnn , the resolution was finally passed and adopted by the Council to be effective immediately by the following vote: 6_ voted "For" 1 voted "Against" n abstained all as shown in the official Minutes of the Council for the meeting held on the aforesaid date. 0463697 J A 2. The attached resolution is a true and correct copy of the original on file in the official records of the City; the duly qualified and acting members of the City Council of the City on the date of the aforesaid meeting are those persons shown above and, according to the records of my office, advance notice of the time, place and purpose of the meeting was given to each member of the Council; and that said meeting, and the deliberation of the aforesaid public business, was open to the public and written notice of said meeting, including the subject of the above entitled resolution, was posted and given in advance thereof in compliance with the provisions of V.T.C.A., Government Code, Chapter 551, as amended. IN WITNESS WHEREOF, I have hereunto signed my name officially and affixed the seal of said City, this the 13th day of November, 1997. (City Seal) O* Pl htiv Kayt a Darnell City, ecretary, City of Lubbock, Texas -2-