Loading...
HomeMy WebLinkAbout2003-03-11-UTIL-min.pdf Minutes of the Electric Utility Ad-hoc Committee March 11, 2003 Members in Attendance Roger Borghesani, Paul Chernick, Peter Enrich, Ingrid Klimoff, Patrick Mehr, David Pavlik. Kelly McKay Zeoli, Gary Markowitz, Marybeth Gentelmen, Russell Sylva Russell Svlva Russell Sylva, the general manager at Power Options, was asked to attend the meeting and update the committee on what options are available to The Town of Lexington for power supply to the Town's municipal buildings and grounds. Russell has extensive experience in state and local government with energy providers and power options for government entities. The Massachusetts Health and Educational Facilities Authority created Power Options in 1996 to enable nonprofit organizations to benefit from the deregulated electricity and gas industries. The Town of Lexington is a member of Power Options. Russell explained in great legal and technical detail what power supply options are available to The Town of Lexington. He detailed the current offer that the Town now has and advised the committee on what may be the best action for the committee to take in the future for power supply Summary of Russell's main points: Town of Lexington is currently under the standard offer with Nstar for most of its power supply accounts. There may be a few newer accounts under the default rate from Nstar. This offer will be in place until 2005 Currently this rate is a good rate and may be the best place for the Town to be until the standard offer increases. This rate is currently more attractive than the rate offered through the contract that Power Options was able to negotiate with Select Energy However due to the nature of the standard offer the Town should continue to monitor the rates, because they are likely to increase in the future, Also if no other options are found by 2005 the ratepayer will be put on the default rate in 2005, this would not be a good position to be in. 4 The structure of the agreement with Select Energy would allow Towns that are members of Power Options, such as Lexington, to op into the agreement at anytime. The larger accounts that may be on the default rate with Nstar should be reviewed and the Town may consider putting these accounts under Select Energy option offered with Power Options. The benefit would be due to the fact that the defaults rates are higher that what rate is offered under the Select Energy contract. Option A under the PowerOptions contract allows for pricing supply for a minimum of six months up to a maximum period to March 2007 it is expected PowerOptions rates will be significantly under NStar default service rates for the period of six months following July 1, 2003. Option B of the Select Energy agreement allows a member to sign the contract, lock in the terms of the contract until March '05, '06 or '07 while remaining on the low current default rates and receive a rebate of 1% of those rates through July 1, 2003. Power Options has worked out terms and conditions with Select Energy that will protect the member from overpaying charges associated the new Locational Marginal Pricing of"congestion"that is often experienced in the greater Boston area due to the large demand and short supply of low cost generation assets. Select Energy is required to give price quotes twice a week of current retail prices. t; Russ advised the committee to speak with other communities that have used Power Options such as Newton and Brookline. Russ stated that before any changes were made, a town should consider what administrative costs are involved with changing a supplier and would the savings be greater than the costs. The Town of Lexington should be in contact with Power Options and monitor the standard offer rates and consider making changes if the rates continue to increase. Paul and Patrick discussed what needs to be done before town meeting: If Bill doesn't pass in legislation no money will be requested for a study this year. But the warrant article should be keep on. 4 Clearly state that this item before town meeting is to consider creating a muni not only aggregation. To make clear that we have town meeting voice their option on forming a true muni. Patrick added these addition ideas: To have the town meeting direct or send support formally requesting our state congressmen support our effort. TMA to ask selectmen to fund our efforts if Bill passes. Town meeting to understand future coarse of action of the committee. A draft letter was set to done by Wednesday March 19th Next meeting was not scheduled.