HomeMy WebLinkAboutAgenda Report - May 19, 1999 E-05AGENDA TITLE: Reimbursement of one Standby Generator and Establishment of a Load Management
Program ($75,000)
MEETING DATE: May 19, 1999
PREPARED BY: Electric Utility Director
RECOMMENDED ACTION: That the City Council approve the reimbursement of one (1) standby
generator and authorize the development of a load management
program.
BACKGROUND INFORMATION: While working to improve service reliability, the City of Lodi Electric
Utility also investigates possible new services that could be offered to
customers. The project described herein accomplishes both these
goals.
The Bank of Lodi, a Lodi -headquartered commercial/industrial electric customer, has experienced several
power interruptions in the recent past that have halted operations both locally and at branch offices. The
Bank of Lodi utilizes nearly 680,000 kwh annually at their 701 S. Ham Lane facility. The number of
outages experienced are in excess of acceptable reliability criteria for a commercial enterprise. The
Department has taken a number of actions to remedy the existing reliability issue. These actions have, to
date, proven ineffective.
The customer and the Department have investigated possible options to this problem. The Department
estimates that upgrading the portion of the electric distribution system serving the Bank of Lodi at this time
could cost up to $150,000, require rescheduling the Department's extensive distribution and lighting
systems improvements in addition to requiring planned outages of the customer's electric service in order
to perform the work and additional excavation and roadwork at a busy intersection. Another option is to
install a standby (emergency) generator. The customer has determined that such an arrangement would
be acceptable. The total project cost to the Department is $75,000.
The Department recommends an arrangement with the Bank of Lodi whereby the City would reimburse the
customer up to $75,000 in funds for the purchase and installation of the generator. The customer would
be responsible for providing the necessary space and maintenance of the generator at its expense. The
City and the customer will work together to develop a procedure by which the Electric Utility Dispatch
Center could call upon the generator for load support under certain conditions. This arrangement would:
1) Save the City up to $75,000 in construction costs;
APPROVED:
H. Dixon Flynn — City Manager
2) Establish a pilot "load management" program to evaluate additional electric services and
improved practices in order to maintain a competitive edge in a deregulated electric market.
Load management provides staff with additional system control for load control, voltage
support, and relieves system capacity needs;
3) Avoid vehicular and pedestrian traffic interruptions caused by construction;
4) Avoid prolonged service interruptions for the customer and others on the affected circuit;
5) Improve Bank of Lodi electric reliability in excess of that which could otherwise have been
obtained by the City.
The Electric Utility Department believes that in a competitive environment, it is essential to meet and
exceed customer needs. By providing an alternate source of power for a customer experiencing a service
reliability issue, the generator serves as an important tool for ensuring customer satisfaction, while
addressing an immediate need for energy in the event of an outage.
FUNDING: Operating Fund
FUNDING AVAILABLE:
PREPARED BY:
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C: City Attorney
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Vicky McAthie, Finance Director A Z3 a4
Alan N. Vallow
Electric Utility Director
Mel Grandi, Manager Electric Services
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H. Dixon
RESOLUTION NO. 99-73
A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING
REIMBURSEMENT OF ONE STANDBY GENERATOR AND
ESTABLISHMENT OF A LOAD MANAGEMENT PROGRAM
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WHEREAS, Lodi Municipal Code, §3.20.070, authorizes dispensing with bids for purchases
of supplies, services or equipment when it is in the best interest of the City to do so; and
WHEREAS, while working to improve service reliability, the City of Lodi Electric Utility also
investigates possible new services that could be offered to customers; and
WHEREAS, the Bank of Lodi, a Lodi -headquartered commercial/industrial electric
customer, has experienced several power interruptions in the recent past; and
WHEREAS, the number of outages experienced are in excess of acceptable reliability
criteria for a commercial enterprise; and
WHEREAS, the Electric Utility Department has taken a number of steps to remedy the
existing reliability issue, which have proven ineffective; and
WHEREAS, Electric Utility Department has estimated that upgrading that portion of the
electric distribution system serving the Bank of Lodi could cost up to $150,000, which would require
rescheduling the Department's extensive distribution and lighting systems improvements in addition
to requiring planned outages of the customer's electric service in order to perform the work and
additional excavation and roadwork at a busy intersection; and
WHEREAS, another option would be to install a standby (emergency) generator, which is
acceptable to the customer, at a cost of $75,000.00; and
WHEREAS, the Electric Utility Department recommends reimbursing the customer with up
to $75,000.00 in funds to purchase and install the generator, with the customer being solely
responsible for providing the necessary space and maintenance of the generator at its expense,
thereby establishing a pilot "Load Management Program"; and
WHEREAS, the City Manager recommends reimbursement of one Standby Generator for
the Bank of Lodi, and approves the establishment of a Load Management Program.
NOW, THEREFORE, BE IT RESOLVED, that the Lodi City Council hereby approves the
reimbursement of one Standby Generator for the Bank of Lodi, and further approves the
establishment of a Load Management Program.
Dated: May 19, 1999
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I hereby certify that Resolution No. 99-73 was passed and adopted by the City Council of
the City of Lodi in a regular meeting held May 19, 1999, by the following vote:
AYES: COUNCIL MEMBERS — Hitchcock, Nakanishi, Pennino and Land (Mayor)
NOES: COUNCIL MEMBERS — None
ABSENT: COUNCIL MEMBERS — None
ABSTAIN: COUNCIL MEMBERS — Mann
Qrl,EM. IMCHE
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99-73