TRANSMITTAL LETTER FOR BOARD MEETING OF OCTOBER 6, 2016
COMMITTEE ON PROCUREMENT
Mr. David St. Pierre, Executive Director
Title
Report on advertisement of Request for Proposal 16-RFP-28, Procurement of Energy Advisory Services, estimated cost $350,000.00, Account 101-66000-612430, Requisition 1434140
Body
Dear Sir:
Request for Proposal (RFP) documents have been prepared for Procurement of Energy Advisory Services, at the request of the Maintenance and Operations Department.
The purpose of this RFP is to contract with an energy advisory services provider possessing the requisite expertise to prepare all documents necessary to become a Pennsylvania, New Jersey and Maryland (PJM) member. Additionally, they shall provide consultant services on how to buy and sell electrical energy, capacity and Renewable Energy Credits (RECs) on the wholesale market for all Metropolitan Water Reclamation District of Greater Chicago (District) facilities.
A PJM membership and grid interconnection will allow the District the following market options within the PJM electric grid:
• Provide higher value for power generated by the Lockport Power House, digesters or other future assets by selling power directly into the PJM interconnection electricity grid instead of selling the generation to the local ComEd utility;
• Realize revenues by selling the associated RECs created through hydro, digester or other future renewable energy generation;
• Realize revenues for capacity of electricity generation. Members of PJM are compensated for their capacity to generate power by participation in the capacity auction;
• Realize revenue by participation in PJM ancillary market programs including Frequency Regulation, Black Start, Synch Reserves, and Voltage Regulation;
• Potentially realize further savings by purchasing power through PJM at wholesale market prices in the future.
PJM membership costs will include a one-time Application Fee ($1,500.00), an annual Membership Fee ($5,000.00), a one-time PJM Interconnection Fee ($10,000.00), and additional monthly fees. These fees shall be paid by the Energy Advisor as well as other market opportunity management costs.
The estimated total cost for this RFP is $350,000.00 for a five year period. The estimated annual expenditure is $70,000.00 for 2017 through 2021. The District and the selected Energy Advisor may mutually extend this agreement for additional year(s) with proportional mutual benefits. The agreement will only be extended upon approval by the Board of Commissioners.
A bid deposit is not required for this RFP.
Appendix A will not be included as the requested services do not provide practical or cost-effective opportunities for direct or indirect subcontracting.
The tentative schedule for this contract is as follows:
Advertise October 19, 2016
Proposals Received November 18, 2016
Award January 5, 2017
Completion December 31, 2021
Funds are being requested in 2017, in Account 101-66000-612430 are contingent on the Board of Commissioners’ approval of the District’s budget for that year. Funds for 2018, 2019, 2020 and 2021, are contingent on the Board of Commissioners’ approval of the District’s budget for those years.
Requested, John P. Murray, Acting Director of Maintenance and Operations, BAP:SO’C:PD:JR:JL
Recommended, Darlene A. LoCascio, Director of Procurement and Materials Management
Respectfully Submitted, Barbara J. McGowan, Chairman Committee on Procurement
Disposition of this agenda item will be documented in the official Regular Board Meeting Minutes of the Board of Commissioners for October 6, 2016