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HomeMy WebLinkAbout~Master - Waiving Formal Bidding Requirements and Authorizing a Professional Services Contract for MISO Transmission Rate Review and Calculation RESOLUTION NO. 22-014 RESOLUTION WAIVING FORMAL BIDDING REQUIREMENTS AND AUTHORIZING A PROFESSIONAL SERVICES CONTRACT FOR MISO TRANSMISSION RATE REVIEW AND CALCULATION FOR THE CITY OF AMES,IOWA WHEREAS,Ames Electric Services has significant investments in high voltage transmission equipment to serve electric customers,and this equipment connects the City's electric system to the regional electric grid; and, WHEREAS, prior to 2015, the utility had to pay other utilities to use their transmission systems to deliver or"wheel"power from generation sources to the City,and in 2015,after the utility built its latest high voltage transmission line to the Ankeny substation,Ames Electric Services was able to join the Midcontinent Independent System Operator(MISO)as a Transmission Owner(TO); and, WHEREAS, this status as a TO is significant because the utility is now able to offset wheeling costs using the value of transmission investments the utility has made over time;however, annual reports determining the book value of the utility's transmission assets must be prepared and adjusted as equipment ages, new equipment is brought into service, and obsolete equipment is removed from service; and, WHEREAS, at the time the utility became a MISO Transmission Owner, staff made straightforward assumptions regarding which assets should be classified as"transmission,"and with staffing changes, much of the institutional knowledge regarding asset classification is gone, and therefore,the utility would benefit greatly by hiring an experienced consultant to review the current asset allocations,review the most recent transmission rate filing,train staff in developing future rate templates, and assist in the creation of the FY 2022/23 transmission rate; and, WHEREAS, staff believes that the detailed review of the utility's transmission assets provided by a consultant could identify additional assets to count towards the transmission the utilty brings to MISO; and, WHEREAS, as the utility's share of transmission assets increases, the utility collects a greater share of transmission revenue from MISO and this revenue benefits Ames Electric customers by reducing the Energy Cost Adjustment on their electric bills; and, WHEREAS, staff had contacted several consulting firms and talked to other municipal electric utilities in MISO to identify firms with the unique skill set to perform the work desired,and it was determined that this expertise is quite specialized with very few firms having the expertise; and, WHEREAS,MCR Performance Solutions was determined to have the necessary knowledge and could perform the work in the time needed to meet Ames MISO deadline; therefore, staff is requesting a waiver of the Purchasing Policy for competitive bids to allow a contract to be awarded to MCR Performance Solutions; and, WHEREAS, funding for this work will be charged to the transmission expense account within the Fuel and Purchased Power Division,and it is believed that the findings by the consultant will increase transmission revenues to more than offset the study expenses with an estimated payback in fewer than two years. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Ames, Iowa, that the waiver of formal bidding requirements is hereby approved, and a Professional Consulting Services Contract with MCR Performance Solutions, LLC, of Deerfield,Illinois, in the amount of $94,500 for the MISO Transmission Rate Review and Calculation is hereby further approved. ADOPTED THIS 11 Ph day of January, 2022. �uxa& Diane R. Voss, City Clerk John A. Haila, Mayor Introduced by: Betcher Seconded by: Junck Voting aye: Beatty-Hansen, Betcher, Corrieri, Gartin, Junck, Rollins Voting nay: None Absent: None Resolution declared adopted and signed by the Mayor this 1 It' day of January, 2022.