Resolution No. 5396
~ \1
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
RESOLUTION NO. 5396
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF VERNON APPROVING AND RATIFYING THE MAYOR'S
EXECUTION OF A LETTER OF INTENT TO EXTEND THE
POWER SALE AGREEMENT BETWEEN THE DEPARTMENT OF
WATER RESOURCES OF THE STATE OF CALIFORNIA
("CDWR") At'ID THE CITY OF VERNON TO PROVIDE
FOR THE PURCHASE OF CAPACITY AND ENERGY AND
TO PROVIDE NOTICE TO SOUTHERN CALIFORNIA
EDISON COMPANY OF SAID PURCHASE
WHEREAS, the City of Vernon ("vernon") receives power
from the Southern California Edison Company ("Edison") pursuant
to tariff schedules approved by the Federal Energy Regulatory
Commission ("PERCU): and
WHEREAS, FERC approved tariff schedules provide at Spe-
cial Condition 12 that Vernon may purchase power fr,om other sup-
pliers in accordance with certain prescribed notice provisions:
and
WHEREAS, CDWR and Vernon have negotiated a Letter of In-
tent which provides that CDWR sell capacity and energy to Vernon
in accordance with said Special Condition 12: and
WHEREAS, said notification of said purchase had to be
delivered to Edison on or before July 1, 1987: and
WHEREAS, the Mayor of Vernon executed said Letter of In-
tent in accordance with previous Council instructions to permit
the proper notification to Edison in accordance with Special Con-
dition 12.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF
THE CITY OF VERNON AS FOLLOWS:
SECTION 1: That the City Council of Vernon hereby finds
and determines that the recitals contained hereinabove are true
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
and correct.
SECTION 2:
That the City Council of Vernon hereby
ratifies and approves the Letter of Intent, a copy of which has
been presented to the City Council concurrently with this resolu-
tion and the City Council hereby orders said Letter of Intent to
be received and filed by the City Clerk.
That the City Council
SECTION 3:
ratifies and approves the Mayor's execution of said Letter of In-
tent for, and on behalf of, Vernon.
SECTION 4:
The City Clerk of Vernon shall certify to
the passage of this resolution and thereupon
same shall be in full force and effect.
APPROVED AND ADOPTED this 30th day of June, 1987.
~~~~.
At?~4//~
BRUCE V.MALKENHORST, City Clerk
-2-
1 STATE OF CALIFORNIA )
) ss.
2 COUNTY OF LOS ANGELES )
3
4 I, BRUCE V. MALKENHORST, City Clerk of the Ci.'ty of
5 Vernon, do hereby certify that the foregoing Resolution, being
6 Resolution No. 5396
, was duly adopted by the City Council. of
7 the City of Vernon, and was approved by the Mayor of said City
an adjourned
8 at ~ regular meeting of the City Council held on Tuesday,
9
10
11
12
18
14 (SEAL)
June 30
, 19 87 .
~~#~
BRUCE V. MALKENHORST, City
Clerk
15
16
17
18
19
20
21
22
28
24
25
26
27
28
-3-
rr
..
STATE OF CALIFORNIA-THE RESOURCES AGENCY
GEORGE OEUKMEJIAN, Governor
DEPARTMENT OF WATER RESOURCES
P.o. BOX 388
SACRAMENTO, CA 95802
June 29, 1987
Mr. David B. Brearley
City Attorney
City of Vernon
4305 Santa Fe Avenue
Vernon, CA 90058
Dear Mr. Brearley:
Principles for 1989-90 Power Sale between Department of Water Resources and
City of Vernon
The Department of Water Resources (DWR) and the City of Vernon (Vernon) have
executed the Power Sale Agreement as of the 28th day of October 1986. The
Agreement was amended on December 9, 1986, and provided that the Agreement
shall terminate at midnight December 31, 1988, unless extended by mutual
agreement of the Parties under new terms and conditions. DWR and Vernon
intend by this letter. to provide principles for negotiating an extension of
the Power Sale Agreement. The following principles provide for DWR to sell
capacity and associated firm energy to Vernon.
Term: Effective date through December 31, 1990, unless extended by mutual
agreement of the parties under new terms and conditions. The Amendment shall
become effective subject to notice by Vernon that transmission service will
be available under an agreement between Vernon and Southern California Edison
Company (SCE). Such notice shall be provided by October 31, 1987, unless
otherwise mutually agreed in writing by the Parties.
Capacity and Energy: During the period January 1, 1989 through
December 31, 1990, DWR shall provide to Vernon, and Vernon shall accept from
DWR, (1) 98 MW of.firm capacity and 1,372 MtJh of firm associated energy each
work day, as provided in the existing Power Sale Agreement, during the summer
period, and (2) 62 MW of firm capacity and 868 MtJh of associated energy each
work day during the winter season; except that, the firm associated energy
may be reduced during (i) the day before and the day after a holiday, and
(ii) the week before and the week after Christmas. Such reduction of firm
associated energy shall not be scheduled by Vernon to permit the purchase of
off-system energy. The summer period is defined as the period from May 1
through October 31, and the winter period is defined as the period from
November 1 through April 30. The capacity and associated energy shall be
supplied during the on-peak and mid-peak hours where the on-peak hours are
defined in the original Agreement; and the mid-peak hours are defined as,
(1) during the months of May through October from 9:00 a.m. to 1:00 p.m. and
7:00 p.m. to 11:00 p.m., and (2) during the months of November through April
from 8:00 a.m. to 5:00 p.m.
Mr. David B. Brearley
Page 2
June 29, 1987
Charges: Vernon shall pay DWR a capacity charge at the rate of five dollars
per kW-month, except as provided in Section 7.1 of the original Power Sale
Agreement.
Vernon shall pay DWR 26.5 mi11sfkWh for each kWh of firm energy scheduled and
delivered hereunder during the on-peak period. Vernon shall also pay
26.5 mi11sfkWh for each kWh of firm energy scheduled and delivered hereunder
during the mid-peak period; provided, that if in the event of a single
transmission line outage of the existing California AC Intertie Transmission
Line, DWR is unable, after using its best effort, to deliver capacity and
associated energy during the mid-peak period for one half hour or longer in
any given month so as to offset Vernon's requirements, the price of mid-peak
energy sold during such month to Vernon will be at the rate of
24.1 mi11sfkWh.
Hardship: In the event that SCE or the Federal Energy Regulatory Commission
substantially changes the rate form or rate design by which Vernon takes
partial requirements energy and capacity from SCE, the parties may mutually
agree to renegotiate the Agreement in an attempt to satisfy the intent of the
Agreement to provide capacity and firm associated energy during the on-peak
and mid-peak periods. In the absence of mutual agreement to renegotiate or
thereafter to reach agreement on new terms, either party may terminate the
Agreement upon thirty (30) days advance written notice to the other party.
Vernon Acceptance of Proposal: These principles are intended to form the
basis for negotiating an amendment to the existing Power Sale Agreement to be
developed further by DWR and Vernon. This proposal is not an offer; rather a
mutually agreeable Amendment must be executed by the Parties in order for the
proposed Amendment to become effective. The Parties envision having a
completed Amendment before December 31, 1987.
If Vernon wishes to negotiate an extension amendment based on these
principles, please countersign one of the two letters provided and return to
me.
If you have any questions, feel free to call Hr. Thomas Green at
(916) 323-8165.
Sincerely,
CONCUR:
,~'~ f JJ
Viju Patel, Chief
Energy Division
bcc: See attached
David B. Brearley, City Attorney
City of Vernon
RE: Principles for 1989-90 Power Sale Between Department of Water
Resources and City of Vernon June 29, 198~
ATTEST:
/':[ /f~ / ,~
/,J/?/'./[,~-t,/'// /;:t?;,,~:---r
Bruce V.Malkenhorst
City Clerk
EXECUTED BY:
~~~~~ Date: ~-2..9-J.987
~~-Leonis C Malburg, Mayor
APPROVED AS TO FORM:
'V~~(~~
David Brearley
City Attorney
----
~ ('1e.C..l.C
be OFFICERS ~'k
BRUCE V. MALKENHORST.~ \}M
City Adminlatrator /Cit)' Clerk ~
DAVID B. BREARLEY,
Cit)' AUonIeJ
VICTOR H. VAIT8,
Diredor of CommIlDit)' Service.
LEWIS R. ADAMS.
Director of Water A Power
CITY COUNCIL
L.EONIS C. MALBURG. Mayor
, THOMAS A YBARRA. Mayor Pro.Tem
Wm. "BILL" DAVIS
H. "LARRY" GONZALES
W. MICHAEL McCORMICK
TELEPHONES
CITY CLERK..............................~8811
POLICE DEPT. ........__.............587-6171
FIRE DEPT............__._..........583-4821
BUILDING DEPT...__.............583-8811
PUBLIC WORKS DEPT. ..........~8811
HEALTH DEPT. ........_.............~8811
CITY HALL
4305 SANTA FE AVENUE, VERNON, CAUFORNIA 90058
Mr. Viju Patel~ Chief
Energy Division
Department of Water Resources
P.O. Box 942836
Sacramento, CA 94236-0001
Dear Mr. Patel:
l.:..^- . --"""", VI-" ~
GEORGE P. BASS.
Pin CbW
AL ESPINOZA
PoIiee au.t
In ,"ply lUlu 10:
Enclosed for your files is the executed letter agreement for the
"~rinciples for 1989-90 Power Sal~between Department of Water Resources
and City of Vernon.- If you have any questions, do not hesitate to
contact us.
Very truly yours,
CITY OF VERNON
~~~4f~i?
City CI k
BY
DVM/lam
cc: David B. Brearley
osco,
yCi ty C.lerk