HomeMy WebLinkAbout~Master - Authorization of Staff to Amend Contract for Natural Gas Supply for Calendar Year 2025 RESOLUTION NO. 24-305
RESOLUTION AUTHORIZING STAFF TO AMEND THE CONTRACT
FOR NATURAL GAS SUPPLY FOR CALENDAR YEAR 2025
FOR THE CITY OF AMES,IOWA
WHEREAS, the Power Plant typically burns between 8,000 and 12,000 MMBtu of natural gas
daily in either of its two boilers. The natural gas, along with refuse-derived fuel (RDF) from the
Resource Recovery Plant (RRP), are combusted to generate electricity; and,
WHEREAS, on October 15, 2015, Macquarie Energy LLC was awarded a 5-year fixed price
contract for the purchase of 12,000 MMBtu/per day of natural gas for Electric Services. Subsequently,
a 3-year and 1-year extensions were added which brought contract period through December 31, 2024;
and,
WHEREAS,the contract has created efficiency, flexibility, and affordability in the purchase of
a valuable commodity,ensuring that the City has reliable service while creating stable generation costs;
and,
WHEREAS, in the natural gas market, quoted prices expire within a 24-hour period, which is
less time than is necessary to provide notice of a City Council meeting and approve the contract. As
these prices fluctuate between City Council meetings, staff requested the authority to commit the City
to a one-, two-, or three-year extension with a goal to avoid cost increases to electric customers due to
natural gas increases; and,
WHEREAS,this is the method used in 2023 which allowed the Director of Electric Services to
obligate the City to purchase natural gas at previously City Council authorized cap. Under this
alternative, staff will continue to pursue options for reducing the volume of waste received through
recycling and other waste diversion programs.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Ames, Iowa, that
authorizing the Electric Director to approve an amendment to the contract with Macquerie Energy LLC,
of Houston, Texas, to extend the existing natural gas supply contract for a term of not less than one,
but not more than three years at a price of not more than$3.60/MMBtu or a total cost of not more than
$13,980,000 for calendar year 2025 is hereby approved.
ADOPTED THIS 28th day of May, 2024.
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Renee kall, City Clerk John A. Haila, Mayor
Introduced by: Rollins
Seconded by: Beatty-Hansen
Voting aye: Beatty-Hansen, Corrieri, Gartin, Junck, Rollins
Voting nay: None Absent: Betcher
Resolution declared adopted and signed by the Mayor this 28th day of May, 2024.