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HomeMy WebLinkAboutAgenda Report - June 3, 1987 (78)_ COUNCIL COl1AIUNICATIGN DATE NO. To THE CITY COUNCIL 3une 3, 1987 FROM. THE CITY MANA:.GE 'S OFFICE - SUBJECT: APPROVAL OF LETTER OF AGREEMENT ISOIOP�'YSTal NEARIVE LODZZS OF INTERCONNECTION AT 230 KV WITH WESTERN AP.EA ' RECOMMENDED ACTION: That the.Lodi City CounciloAgreemente(ExhibitdA}ezndution (Exhibit B) and approve the attachedLetter of g authorize the City Manager and City Clerk to execute the subject agreement on behalf of the City. iscussion of "Reliability" with City Coancil last BACKGROUND INFORMATION: D December included commF.,ts on the possibi:ity of an interconnection at 230 This interconnection. could assurethe City adequate t Tnsm-1ajor transmissionion capacity o over 30 years,. assuming presentg approximately circuits are accessible in the vicinity of 1-5 and Highway 12, five miles west of Lodi. ion, development of envirorofntheproject. engineering Preliminary to any such interconnect and economic studies are required to determine the feasibility P ject A basis to initiate these studies prior to final decision iondto proceedons oftwith the proposed interconnection is includednature. Department of Energy Letter of Agreement attached for sig Preliminary economic analysis of the 230-kv interconnection project by a consulting engineering firm indicates savings of over a million dollars per over the 3%`-yoar life of the project. A year are achievable on the average while a best -case analysis showb benefits exightyears. The g cost in telements he first ofabenefit worst case indicates break-even in eight y generally consist of a combination of direct access high-voltage discount --4 reduced transmission wheeling rate. The work to be performed under the Letter of Agreement may be terminated by the City in ten (10) working days by issue and receipt of notice. dealt first since th Environmental consfderatately ecocnomiclana ions must be w lysis determine whether to proceed further or not. Even though the proves favorable, any impediment in the enviroianental review would preclta review will begin, ude proves continuation of the project. ental aem ndseconomicdanalysis proves favorable. all, when the project environm The cost for scheduled studies through the second quarter 1988 is included in the Electric Utility Department Budget for 1987-88. Henry J. Rice Electric Utility Director Attach. (2) RESOLUTION NO. 87-62 RESOLUTION APPROVING LETTER Or AGREEMENT FOR COOPERATIVE ANALYSIS OF INTERCONNECTION AT 230 KV WITH WESTERN AREA TRANSMISSION SYSTEM NEAR LODI RESO_VED, that the City Council of the City of Lodi does hereby approve tLe Letter Of Agreement with the Western Area Power Administration fc-r cooperative analysis of interconnection at 230 KV with the Western Area Transmission System near Lodi, a copy of which is attached hereto, marked Exhibit "A", and thereby made a part hereof. BE IT FURTHER RESOLVED, that the City Council of the City of Lodi does hereby authorize the City Manager and City Clerk to Pxec;:te the subject agreement on behalf of the City. Dated: June 3, 1987 I hereby certify that Resolution No. 87-62 was passed and adopted by the City Council of the City of Lodi in a regular meeting held June 3, 1987 by the following vote: Ayes: Council Members = Hinchman, Pinkerton, Reid Snider, and Olson (Mayor) Noes: Council Members - None Absent: Council Members - None Abstain: Council Members - None ALICE M. REI CHE City Clerk } 87-62 Department of Energy Westert ,-.rea Power Administration Sacramento .Area Office 1825 Bell Street. Suite 105 Sacramento. California 95825 In reply refer to. Mr. Henry J. Rice Electric Utility Director City of Lodi 221 West Pine Street Lodi, CA 95241-1910 Dear Mr. Rice: 141A Y 1 1987 ci'Jaky Dept. n �t ? PR �, This letter sets forth the terms and conditions of an agreement between the City of Lodi (Lodi) and the Western Area Power Administration (Western) which provides the basis for Western and Lodi to proceed in the development of environmental, real estate, and engineering studies, and a contractual agreement which are prerequisite to any final decision to proceed with the proposed interconnection of Lodi's system with Western's 230 -kV transmission system near Lodi, California. 1. Wes'.--rn and Lodi agree to cooperate in analyzing and developing the proposed interconnection to the Western 230 -kV transmission system near Lodi, California; provided however, neither Western nor -Lodi shall be obligated hereunder to make the actual interconnection. 2. This Letter of Agreement (LOA) shall not be construed to obligate Western or Lodi to execute an agreement for the direct interconnection by Lodi. 3. As soon as practicable after the execution of this LOA, Western shall initiate systems studies on the proposed project which will cumulate in a Systems Studies Report. Lodi shall provide Western, in a timely manner, with the project specific system data needed as input to the studies. Western shall supply all other data as needed and shall complete the System Studies Report, using Western's computer facilities, by the date shown in Exhibit A attached to this LOA, or at such time as is mutually agreeable. 4. As soon as practicable after the execution of this LOA, Lodi shall provide Western with sufficient planning data and related information for the direct interconnection to be included in a Facilities Development Report (FDR). Lodi will prepare the draft FDR for Western's review. This report shall be finalized by the date shown in Exhibit A, or as may otherwise be mutually agreed. 5. As soon as practicable after the execution of this LOA, Western shall proceed to prepare the necessary environmental documentation for National Environmental Policy Act (NEPA) compliance. Western shall coordinate its NEPA compliance work with Lodi's California Environmental Quality Act compliance work. These studies shall be completed by the date shown in Exhibit A, or at such time as mutually agreeable. 6. Lodi agrees to pay Western in advance all costs for work performed by Western under this agreement, including Western's administrative expenses. Western agrees to perform the following items in accordance with the completion schedule shown in Exhibit A. a. Review and finalize the FDR, which is prepared by Lodi. b. Prepare &Rd complete the Systems Studies Report. c. Complete the environmental clearance for the project which includes preparation of a schedule and nlan for the work, procurement and management of subcontracts, preparation of an environmental assessment, public meetings and agency consultation, and coordination with Lodi. d. Review real estate requirements, including right-of-way and easement studies. e. Prepare and complete the Interconnection Agreement. f. Participate jointly with Lodi to prepare and complete the Design Data Report, including the aerial photography, plan and profile, access roads, substation surveys, and the geology report. 7. The cost of the studies, between Western and Lodi, may be updated by Western to correctly reflect the evaluation of work performed by Western. In the event that any estimated cost is expected to be exceeded, prior written approval shall bE obtained from Lodi before Western performs any additional work. 8. Immediately following execution of this agreement, and by the first of the seven succeeding quarters, and as necessary thereafter to cover approved increases, Lodi shall advance to Western for deposit to a trust fund a -count, the sum of the total quarterly cost provided in the attached Exhibit A which will be applied to the costs of performing the tasks outlined in Exhibit A. Western will provide a summary of expenses at the end of each quarter pursuant to the schedule of activities. 9. If Western's accrued cost exceeds 80 percent of the the cumulative advances by Lodi, then Western will immediately bill Lodi for the amount deficient in that quarter and Lodi shall pay Western within ten (10) days of the bill date. If costs incurred by Western are less than the quarterly advanced payment, then the difference shall be adjusted. 10. Western shall provide Lodi with an itemized statement of costs and work performed within sixty (60) days of the completion of the studies and reports described in paragraphs above. Any funds advanced by Lodi for this LOA in excess of the actual costs incurred by Western will be returned to Lodi without interest, as soon as practicable after the work outlined in this LOA is completed. 11. This LOA shall terminate on the date that an interconnection agreement is executed by Western and Lodi, and all sums advanced and all costs accrued under this LOA shall be transferred to and accounted for under the interconnection agreement. If such an agreer.ent is not executed, then this LOA shall terminate on the earlier of a final settlement or ten (10) days after receipt by Western of a written notice by Lodi to stop work provided that all obligations incurred by either party prior to the date of termination shall be preserved unto( satisfied. If the above stated terms and condition,, of the agreement are acceptable to Lodi, please sign both originals of this LOA, with attestation to indicate your acceptance and return to: David G. Coleman Area Manager Sacramento Area Office Western Area Power Administration 1825 Bell Street, Suite 105 Sacramento, CA 95825 WESTERN AREA POWER ADMINISTRATION By: Title: Area Mana4er Address: 1825 Bell Street Suite 105 CITY OF rL7 By . t . � • — ATTESTATION: Thomas a erson Title: s , . City Manager By. - Address: 221 West Pine Street Alice M. R&imche Title: City Clerk Lodi, CA 95240__ bcc: NOOOO, N6000, N6100, N6116 (RF OF) WESTERN AREA POWER ADMINISTRATION CITY OF LODI EXHIBIT A WESTERN WORK SCHEDULE 1. This Exhibit A, made this jo� day of 1987. to be effective upon execution of this Letter of Agreeme dated 0198Z. This Exhibit A shall remain in effect until superseded by eother Exhibit A, provided that, 2. Western will perform work required for these studies within the time frames listed herein. This schedule may be modified by the mutual consent of the parties. DATES OF COMPLETION AND STUDY COSTS FOR 1987 Work to be Quarter 2 1987 Quarter 3 1987 Quarter 4 1987 Performed April - June July - Sept Oct - Dec Facilities Development Report System Studies Environmental Studies Real Estate Review Contract Preparation Design Data Review Total Quarterly Cost for 1987 0 0 0 0 0 0 5,000 25,000 35,000 0 0 5,000 0 0 0 0 0 _ 0 UU 0 $ 25100_: $ 40,000 Page 2 Work to be Performed Facilities Development Report System Studies Environmental Studies Real Estate Review Contract Preparation Design Data Review Total Quarterly Cost for 1988 ATTESTATION: WESTERN AREA POWER ADMINISTRATION CITY OF LODI DATES OF COMPLETION AND STUDY COSTS FOR 1988 Quarter 1 1988 Quarter 2 1988 Quarter 3 1988 Quarter 4 1988 Jan - Mar April - June July - Sept Oct - Dec -0- 5,000 -0- -0- -0- 5,000 5,000 -0- 28,000 5,000 -0- -0- -0- -0- -0- -0- -0- 2,000 -0- -0- -0- 10,000 20,000 20,000 $ 28_1000 $ 27,000 $ 25,000 $ 2010:10 By: Alice ^4. Reimche Title: _Ci±y ClPr>< WESTERN AREA POWER ADMINISTRATION By: Title: Area Manager Address: 1825 Bell St., Suite 105 Sacramento, CA 95825 LODI By: Thomas A. Peterson Title: ri t3Z anagpr - City of Lodi Address: rity Nal i Call Box 3006 Tndi� ['al ifrvrnia 9524.1 - 1910