The URL can be used to link to this page

Home My WebLink AboutCOUNCIL - AGENDA ITEM - 06/09/2009 - RESOLUTION 2009-059 APPROVING EXEMPTIONS TO THE US ITEM NUMBER: 6 AGENDA ITEM SUMMARY DATE: June 9, 2009 FORT COLLINS CITY COUNCIL STAFF: Mike Freeman SUBJECT Resolution 2009-059 Approving Exemptions to the Use of a Competitive Process for Contracts for Development and Demonstration of a Coordinated and Integrated System of Mixed Distributed Electric Resources under a Grant from the U.S. Department of Energy. RECOMMENDATION Staff recommends adoption of the Resolution. FINANCIAL IMPACT The total budget for the project is$11.1 million,which has already been appropriated. In November 2008,the City Council authorized Resolution 2008-106,which allows the City Manager to execute the agreement with the Department of Energy (DOE) and enter into subcontract agreements with the project partners. The agreement outlines, per the grant submittal, how matching funds are contributed and DOE funds are distributed amongst the partners. This Resolution allows the City, as grant administrator, to contract with the. non-governmental partners as an exemption to competitive process. Total project budget: $1190529942 Total matching funds: $ 4,729,561 Funds from DOE: $ 6,323,381 EXECUTIVE SUMMARY This project will modernize and transform a portion of the electrical distribution system in the City by developing and demonstrating a coordinated and integrated system of mixed distributed electric resources — including renewable generation (solar), rotary- and inverter-based generation, and demand response methods — that will reduce peak loads on multiple distribution feeders in the downtown area by up to 30% and deliver improved efficiency and reliability. BACKGROUND The applicant for the overall project is the City of Fort Collins. The project will address the Research,Development, and Demonstration of a Coordinated and Integrated System of 3.5 MW of Mixed Distributed Resources in Fort Collins to Achieve a 20-30%Peak Load Reduction on Multiple June 9, 2009 -2- Item No. 6 Distribution Feeders. Fort Collins is well positioned to execute this contract due to the unique combination of world-class research facilities at Colorado State University,participation of global industry leaders and local entrepreneurs able to commercialize the technology, the City of Fort Collins focus on and investments in clean energy as a key pillar of future growth, the presence of a city owned utility and extensive community support. Since this grant has been awarded and the City has begun the process of executing subcontracts with the project partners,a question has come up regarding the need to competitively bid the participation of the partners. Project partners were identified early,prior to the grant being submitted,and letters of commitment were solicited by the City to outline and secure the partners role. The original concept for FortZed came from the UniverCity Connections project, organized through the Community Foundation. Many of the partners were involved in the UniverCity Connections effort and were recruited to participate with cash and no-cash matches. Other partners were specially recruited for their expertise and/or specialized equipment what would be needed. The overarching goal was to include as many local partners as would be possible—a goal that was certainly met with this project. It was never envisioned at the time that a competitive process would be used as the partners' roles were voluntary and each partner brings specific value to the overall project. This Resolution clarifies that the City can enter into these subcontract agreements with no competitive process required. ATTACHMENTS I. RDSI Project Partner Funding Summary. Attachment 1 RDSIPROJECT PARTNER FUNDING SUMMARY June 9,2009 PROPOSAL TO DOE: PARTNER PARTNER MATCHING OTHER MATCHING UTILITY REBATES DOE TOTAL City of Fort Collins: $ 477,086 $ 360,000 $ 67,900 $ 77,184 $ 982,171 Larimer County $ 11,464 $ - $ 25,000 $ 45,800 $ 82,264 Colorado Slate University $ 262,404 $ 350,000 $ 42,500 $ 1,517,374 $ 2,172,277 Spirae $ 703,550 $ - $ 2,355,200 $ 3,058,750 Brendle Group $ 20,217 $ - $ 404,318 $ 424,535 New Belgium Brewing $ 2,000,000 $ 100,000 $ 1,160.395 $ 3,260.395 Woodward Governor $ 117,840 $ - $ 256,110 $ 373,950 Eaton $ 115,000 $ - $ 314,000 $ 429,000 Advanced Energy $ 118,000 $ - $ 99,000 $ 217,000 Caterpiller $ 94,000 $ - $ 94,000 $ 188,000 PROPOSAL TOTAL PROJECT $ 3,919,561 $ 810.000 $ 135,400 $ 6,323,381 $ 11,188,342 GRANT AWARD FROM DOE: DOE excludes Utility rebates from Award project costs. $ (135,400) $ (135,400) DOE AWARD TOTAL PROJECT $ 3,919,561 $ 810,000 $ - $ 6,323,381 $ 11,052,942 PROJECT ADJUSTMENTS TO DATE: Caterpiller was forced by market conditions to with draw from project �] => CAT Generation lost: -650 Kw => New Belgium and Woodward Governor have collaborated to obtain Cummins Generator at New Belgium: 230 Kw => CSU InteGrid Lab and VanDyne have collaborated to make VanDyne test unit available for project: 700 Kw => Fort Collins L&P is working to enhance kW capacity at InteGrid lab to support VanDyne units: => Caterpiller funding being used to accomplish the above,matching from VanDyne,DOE funds to cover L&P Costs 7 DOE AWARD CHANGES TO DATE:NO FUNDING CHANGES I CAPACITY ADDED TO TEST PERIOD 280 Kw Z �3 RESOLUTION 2009-059 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROVING EXEMPTIONS TO THE USE OF A COMPETITIVE PROCESS FOR CONTRACTS FOR DEVELOPMENT AND DEMONSTRATION OF A COORDINATED AND INTEGRATED SYSTEM OF MIXED DISTRIBUTED ELECTRIC RESOURCES UNDER A GRANT FROM THE U.S. DEPARTMENT OF ENERGY WHEREAS, the City has applied for and been awarded grant funds from the U.S. Department of Energy ("DOE") in order to carry out' a project intended to modernize and transform a portion of the electrical distribution system in Fort Collins (the "Project"); and WHEREAS the Project will include research, development and demonstration of a coordinated and integrated system of approximately 3.5 megawatts of mixed distributed resources in Fort Collins to achieve a twenty to thirty percent reduction in peak loads on multiple distribution feeders and to deliver improved efficiency and reliability; and WHEREAS, the mixed distributed electric resources to be utilized by the Project include renewable generation (solar) as well as rotary-based and inverter-based generation, and the Project will further emphasize the use of demand response methods; and WHEREAS, the City has worked with several cooperating government and private entities to create a unique combination of world-class research facilities, global industry leaders and local entrepreneurs to develop and plan the Project; and WHEREAS, the project partners working with the City to provide matching contributions and to implement the Project include Colorado State University, Larimer County, and the Governor's Energy Office (the "Public Entities"); and New Belgium Brewing Company, Advanced Energy Industries, Inc., Brendle Group, Eaton, Spirae, and Woodward Governor (the "Private Entities") (collectively referred to as the "Project Partners"); and WHEREAS, Spirae, Inc, assisted the City in creating the proposal that ultimately resulted in the award of grant funds and will provide necessary equipment and infrastructure; develop specifications for project equipment; install and commission equipment; create system level requirements, design and development; undertake research and development activities; implement the system; and provide project operations support; and WHEREAS, the amount budgeted for the services of Spirae, Inc is $2,355,200; and WHEREAS, The Brendle Group Inc, assisted the City in creating the proposal that ultimately resulted in the award of grant funds and will work with the Project Partners to define operational standards for demand response assets; participate in Project leadership and planning; coordinate with the DOE Cost and Benefit Analysis Team; and work with the City on developing a marketing and communications campaign to educate customers within FortZED and the larger community about the economic, social and environmental outcomes of the Project; and WHEREAS, the amount budgeted for the services of The Brendle Group Inc is $404,318; and WHEREAS, New Belgium Brewing Company is located within the geographical area that is the subject of the grant, is a significant consumer of utilities and has agreed to provide the use of its facilities as a development site for technologies to be operated as part of the Project, and to acquire related equipment for installation on its site; and WHEREAS, the reimbursement budgeted to be paid to New Belgium Brewing Company for its involvement in the Project is $1,160,395; and WHEREAS, Woodward Governor Company has significant specific knowledge, skill and equipment necessary for completion of the Project, and has agreed to provide distributed generation controls and operating equipment and related technical and operational services and staff support for the Project; and WHEREAS, the reimbursement budgeted to be paid to Woodward Governor Company is $256,110; and WHEREAS, Eaton Corporation has significant specific knowledge, skill and equipment necessary for completion of the Project, and has agreed to provide electrical switchgear equipment and related technical and operational services and staff support for the Project; and WHEREAS, the reimbursement budgeted to be paid to Eaton is $314,000; and WHEREAS, Advanced Energy Industries, Inc., also has significant specific knowledge, skill and equipment necessary for completion of the Project, and has agreed to provide photovoltaic inverter equipment and related technical and operational services and staff support for the Project; and WHEREAS, the reimbursement budgeted to be paid to Advanced Energy Industries, Inc., is $99,000; and WHEREAS, the total cost of the Project is estimated at $11,052,942 and WHEREAS, the DOE grant funding for the Project totals $6,323,381, and the matching funds required for the Project total $4,729,561; and WHEREAS, in November 2008, the City Council adopted Resolution 2008-106, authorizing a Grant Agreement with DOE, which has since been signed on behalf of the City; and WHEREAS, in Resolution 2008-106, the City Council also authorized the execution of subrecipient agreements with each of the Project Partners, incorporating the requirements of the Grant Agreement and specifying the agreed upon grant funding and matching contribution shares; and -2- WHEREAS, since the adoption of Resolution 2008-106, in the course of final development of the agreements with Project Partners, staff has concluded that the City's arrangements with certain of the Project Partners constitute procurements that are subject to competitive purchasing requirements of the City Code; and WHEREAS, in light of the deadline for completion of the requirements of the Grant .Agreement and the active involvement and collaboration with the Project Partners from the initial stages of development of the grant application for the Project, further delay in the final development and execution of the agreements with the Project Partners would likely jeopardize the Project and could potentially result in the loss of the Grant funding; and WHEREAS, Article IV, Section 8,161(d)(1)b. of the City Code authorizes the Purchasing Agent to contract for material or services where, although there exists more than one responsible source, a competitive process cannot reasonably be used or, if used, will result in a substantially higher cost to the City, will otherwise injure the City's financial interests or will substantially impede the City's administrative functions or the delivery of services to the public; and WHEREAS, the Purchasing Agent has determined that although there exists more than one responsible source, a competitive process cannot reasonably be used or, if used, will result in a substantially higher cost to the City, will otherwise injure the City's financial interests or will substantially impede the City's administrative functions or the delivery of services to the public; and WHEREAS, the Purchasing Agent has submitted the requisite justification for said determination to the City Manager for approval; and WHEREAS, the City Manager has reviewed and approved the justification for this procurement; and WHEREAS, Section 8-161(d)(3) requires the City Manager to submit all procurements over Two Hundred Thousand Dollars ($200,000)to the City Council in an open meeting for final approval. NOW THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF.FORT COLLINS that the Purchasing Agent is hereby authorized to contract with each of the Private Entities for the services and materials to be provided to the Project as an exemption to the City's competitive purchasing requirements. -3- Passed and adopted at an adjourned meeting of the Council of the City of Fort Collins this 9th day of June A.D. 2009. Mayor ATTEST: City Clerk -4-