Q'(\\Q City of Troy

TROY CITY COUNCIL

COMMIITEE MEETING NOTICE
COUNCIL CHAMBERS, CITY HALL
100 S. MARKET STREET, TROY, OHIO
WEDNESDAY, JANUARY 29, 2014, 7:00PM
Utilities Committee (Tremblay [Chm.], Clark, Twiss)
1 . Provide a recommendation to Council regarding authorizing the Director of Public Service and
Safety to enter into a three-year agreement with First Energy Solutions to provide electric power
generation to Troy households and small commercial businesses. Consideration of emergency
legislation requested.
Safety & Health Committee (Oda [Chm.], Clark, Heath)
1. Review of Resolution supporting the Regional Green Initiative.
1-27-2014
cc: Council
Mayor
Mr. Titterington
Mr. Livingston
Mr. Stickel
Department Heads
Chamber of Commerce
Government Class
Board of Education
Media
UTILITIES
COMMITTEE

Q'f\\0 City of Troy

TO:
FROM:
DATE:
MEMORANDUM
Mrs. Baker, President of Co;Jll
Patrick E. J. Titterington
January 27, 2014
Patrick E. J. Titterington
I - - -
100 S. Market Street
P. 0. Box 3003
Troy, Ohio 45373
www.troyohio.gov
phone: (937) 335-1725
. . . -
fax: (937) 339-8601
patrick.titterington@troyohio.gov
SUBJECT: GOVERNMENTAL OPT-OUT ELECTRIC AGGREGATION PROGRAM -APPROVAL
OF AGREEMENT WITH FIRST ENERGY SOLUTIONS
RECOMMENDATION:
That Council authorizes the Director of Public Service and Safety to enter into a three-year agreement
with First Energy Solutions to provide electric power generation to Troy households and small
commercial businesses. So that citizens can receive the lower rate offered by First Energy Solutions as
early as the April 2014 billing cycle, we ask that emergency legislation be considered.
BACKGROUND:
The history and background of the Governmental Opt-Out Electric Aggregation Program is discussed in
the attached memorandum.
REQUESTED ACTION:
It would be appreciated if you would assign to a Committee of Council consideration of emergency
legislation authorizing the Director of Public Service and Safety to enter into a three-year agreement with
First Energy Solutions to provide electric power generation to Troy households and small commercial
businesses.
Encl.
Cc: Mayor Beamish
D. Swan
City of Troy
Engineering Department
TO: Patrick E.J. Titterington, Director of Public Service and Safety
FROM: Deborah Swan, P.E., City Engineer
SUBJECT: Electric Aggregation
DATE: January 27, 2014
Recommendation
That City Council pass emergency legislation on February 3, 2014 and authorize you to
sign an electric aggregation contract with First Energy Solutions for a term of three
years at a fixed rate as outlined in the attached analysis.
Key Timeline Dates:
November 2011-voters in the City of Troy overwhelmingly approved a ballot
issue giving the City of Troy authority to implement an 'opt out' residential and
small business electric aggregation program.
November 2012-Schneider Electric was hired to assist in the development of a
Plan of Operation and Governance.
February 2013-the City of Troy Electric Power Aggregation Plan of Operation and
Governance was submitted to Public Utility Commission of Ohio (PUCO) and
approved 45 days later.
October 2013-PUCO issued final decision re DP&L rate case.
December 2013-the City issued Request for Proposals (RFP) to the electric
providers in Ohio that have history with electric aggregation.
January 16, 2014-RFPs received and analyzed by Schneider.
January 27, 2014-Mayor and key City staff review Schneider recommendation.
Electric Aggregation Recommendation
January 27, 2014 - Page 2 of 2
January 29, 2014-Troy City Council Utilities Committee meeting recommendation
to full City Council (proposed)
February 3, 2014-Troy City Council emergency legislation passage (proposed)
February - March 2014-Notifications sent to all residential and small business
( <700,000 KhW) accounts electric accounts who are not currently under
individual contract, have not asked to be excluded from the aggregation
program, and who are doing business solely in Ohio (not part of a larger multi-
state franchise or chain) (proposed).
April 2014-New First Energy rate goes into effect during April billing cycle
(proposed).
Highlights
Schneider Electric issued a Request for Proposals (RFP) to four vendors: First Energy,
Duke, AEP, and DPL Energy. Attached is an analysis by Schneider of the RFPs, as well
as Schneider's recommendation that the City Council authorize you to sign a 3-year
fixed price contract with First Energy, effective April 1, 2014. As you can see from the
attached, First Energy submitted the most competitive bids, which are the best and
lowest per Schneider's analysis. Schneider recommends the fixed rate proposal for
three-years, as that provides the best estimated savings of 24/o over current market
rates. Please note that savings estimates are per D P & L's current tariff rates. Future
year savings will vary after the annual electric auction takes place. However, again,
Schneider anticipates that First Energy's fixed rate bid will remain the most competitive.
Additionally, First Energy has agreed to provide budget billing when requested and will
not charge a termination fee if a customer decides later to sign with another provider.
First Energy is the supplier for the majority of government aggregation contracts in
Ohio.
Recommendation
It is recommended that City Council authorize you to sign a contract with First Energy
to implement electric aggregation for a three-year fixed rate plan as proposed. It is
possible that residents and small businesses can start saving electric costs as of April 1st
but only if City Council will pass emergency legislation at its February 3rd Council
meeting.
If any further information is needed, please let me know.
City of Troy
Monday January L ?t
Rf::P Results
Summary of Bids
% Discount to Tariff Generation
FirstEnergy Solutions (FES)
3 years: 28%
4 years: 24%
5 years: 18%
DPL Energy (DPLER)
3 years: 18.5% (negotiated)
4 years: no bid
5 years: no bid
Duke Energy Retail Service
No Bid
AEP Energy
No Bid
AII-I n-Fixed Price
FirstEnergy Solutions (FES)
3 years: $0.0526
4 years: $0.0540
5 years: $0.0549
DPL Energy (DPLER)
3 years: $0.05825
4 years: $0.06025
5 years: $0.06235
Duke Energy Retail Service
3 years: $0.0579
AEP Energy
3 years: $.05657
1
Most Competitive Bids
28% Discount Bid Fixed Price ($0.0526 per kWh)
Avg. Savings by Customer Type Avg. Savings by Customer Type
Residential $163.57 Residential $208.53
Residential Heating $184.82 Residential Heating $178.64
Commercial (SP) $219.68 Commercial (SP) $256.29
Commercial (TP) $932.00 Commercial (TP) $1,087.32
Aggregate Savings Aggregate Savings
Residential $709,726 Residential $904,829
Residential Heating $192,953 Residential Heating $186,498
Commercial (SP) $62,389 Commercial (SP) $72,787
Commercial (TP) $175,217 Commercial (TP) $204,417
TOTAL $1,140,285 TOTAL $1,368,530
Overall Bill Impact Overall Bill Impact
14.42% on average 17.93% on average
Accounts NOT Included in Aggregation Program
Accounts with annual usage of 700,000 kWh or more
Percentage of I nco me Payment Plan Customers
7.2% of eligible customers are PIP
Residents & businesses currently under contract with third party
suppliers
41.7% already in a supply agreement
Residents & businesses that have requested to be on the PUC Do
Not Aggregate List
Recognized national accounts
Lighting accounts/meters
2
Comparable Government Aggregations
No recent % discount deals for municipalities within DP&L territory
Recent fixed price deals (most are 1 year deals)
Village of New Paris (DPLER) $0.0656 $150 term fee
Preble County (FES) $0.0580 $50 term fee
Clinton County (OPLER) $0.0549 $75 term fee
Jackson Township (OPLER) $0.0549 $75 term fee
City of Wilmington (DPLER) $0.0529 $75 term fee
Comparable City of Troy fixed price deal (3 years)
City of Troy (FES) $0.0526 $0 term fee
term fee = termination fee
Schneider Electric Recommendation
Supplier: FirstEnergy Solutions
Pricing: All-ln-Fixed Price @ $0.0526/kWh
Term Start: April 2014
Term Length: 36 months (3 years)
Comments
Credit is approved
Full requirements (no usage bandwidth)
Fixed price includes energy, capacity, congestion, RPS, ancillaries, and
line losses
At this time, FES is unable to price 14 accounts
Ability to offer consolidated and budget billing
FES is able to offer civic grants and green energy in pricing
No Cancellation Fee
Ability to enroll new accounts on a quarterly basis
3
Analysis
Schneider recommends Troy fix their energy price beginning with the
April 2014 meter read in order to take advantage of savings in the
Dayton Power & Light market versus current tariff. Based on the current
tariff, Schneider is recommending a fixed price contract instead of a
discount to tariff because the fixed price results in an estimated
$228,245 in additional savings versus the discount to tariff price.
Schneider is also recommending that Troy contract a 36 month term in
order to take advantage of the lack of wholesale energy premiums for
2015 & 2016, and also to receive the lowest fixed price across all terms.
Schneider is also recommending that Troy contract with FirstEnergy
Solutions because they offer the most competitive price and meet all of
the requirements that Troy has requested: ability to budget and
consolidate bills, no cancellation fees and ability to provide customer
service.
S, 1fl f n ~ r E : ; . r c -
Risk & Implementation
Risks
Tariff rates could settle lower than the fixed energy price due to subsequent
utility auctions.
Market rates could fall below the fixed energy price.
Market rates could increase making a longer term more economical overall.
Hourly index prices could settle below the fixed price.
All pricing is indicative, electric power pricing is the most volatile commodity,
and prices can change prior to contracting.
Implementation
A FirstEnergy Solutions contract has been sent to Troy for review.
The contract will need to be reviewed and negotiated by Troy and
Schneider, prior to requesting executables.
Troy will need to sign a contract by approximately February 12, 2014 in
order to possible meet a April2014 enrollment, the start date would be
dependent on how quickly the contracted supplier can provide opt-out
information to residents.
4
Comparison of Other Dayton Area Aggregation Contracts
City Supplier Price Term Start Term Length Termination Fee
Village of New Paris DPLER $ 0.0656 3/1/2014 1 year $150
City of Wilmington DPLER $ 0.0529 1/1/2014 1 year $75
Clinton County DPLER $ 0.0549 4/1/2014 1 year $75
Jackson Township DPLER $ 0.0549 4/1/2014 1 year $75
Preble County FES $ 0.0580 11/1/2012 18 months $50
City of Troy FES $ 0.0526 4/1/2014 3 years $0
01/28/14
Comparison of Estimated Savings with First Energy Solutions Aggregation Award
#Accounts #Accounts 28% Discount 28% Discount 28% Discount Fixed Price
Rate Class Total (Zero Usage) Total Savings Avg. Savings Bill Impact % Total Savings
Residential Non-Heating 4,339 17 $709,726 $163.57 14.85% $904,829
Residential Heating* 1,045 1 $192,953 $184.82 14.39% $186,498
Commercial (Single Phase) 291 7 $62,389 $219.68 11.94% $72,787
Commercial (Three Phase) 189 1 $175,217 $932.00 13.84% $204,417
5,864 26 $1,140,285 $195.32 14.42% $1,368,530
* residences that have separate accounts due to the use of high electrical demand devices, such as electric heat pumps.
$1,000,000
$900,000
$800,000
$700,000
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
$0
Residential Non-Heating
Savings by Rate Class
Residential Heating * Commercial (Single Phase)
28% Discount Fixed Price
Total Savings Total Savings
Fixed Price Fixed Price
Avg. Savings Bill Impact %
$208.53 19.41%
$178.64 15.79%
$256.29 13.93%
$1,087.32 16.14%
$234.42 17.93%
Commercial (Three Phase)
01/28/14
SAFETY & HEALTH
COMMITTEE
Patrick E. J. Titterington
I - - - ... -

Qt\\0 City of Troy

100 S. Market Street
P. 0. Box 3003
TO:
FROM:
DATE:
SUBJECT:
MEMORANDUM
Safety & Health
Patrick E. J. Titterington k#-
January 28, 2014
Troy, Ohio 45373
www.troyohio.gov
phone: (937) 335-1725
fax: (937) 339-8601
patrick. titterington @troyohio .gov
RESOLUTION SUPPORTING THE REGIONAL GREEN INITIATIVE
The attached draft no longer contains references to Green America or that Exhibit or Attachment and
focuses on the more generic ideals of being "green" and environmentally friendly. While it does
specifically reference the Dayton Regional Green 3 (DGR3) initiative, it does not mention the website or
the attachment related to it. Since DRG3 focuses on local initiatives and not any kind of social policy
against specific businesses or industries, and since this is the crux of the regional effort, it is felt there
should be some reference to it in the resolution. You'll note that the Resolution title is more generic.
Also, the language is references being cost effective, reasonable and feasible throughout more of the
"Whereases" and the "Therefores".
If there are members of Council who are not able to attend the Committee meeting for any reason and
would like to suggest other language changes, perhaps those members could provide the Chair with
suggested language to be discussed at the Committee Meeting.
Encl.
Redrafted for Committee 1-29-2014
RESOLUTION SUPPORTING EFFORTS IN THE MIAMI
VALLEY TO ENCOURAGE REGIONAL SUSTAINABILITY
WHEREAS, the City of Troy Comprehensive Plan, laws, regulations and policies recognize the need to
balance support for community growth with the sustainability of the environment, the economy, and a healthy
community; and
WHEREAS, the City of Troy supports "The Concentrated Development Vision" of the Miami Valley
Regional Planning Commission's Going Places Initiative, which emphasizes rehabilitation, repurposing and
preservation of regional assets and infrastructure, attached hereto as Exhibit A; and
WHEREAS, the City of Troy strives to be a sustainable City by incorporating reasonable, feasible and
cost effective sustainable practices into City operations and facility renovations through energy and natural
resource conservation, reuse, recycling, and waste reduction; and
WHEREAS, the City of Troy's support for sustainable initiatives is determined through a separate
evaluation of each proposal, program, regulation, and policy for its feasibility and cost effectiveness; and
WHEREAS, the City of Troy desires to demonstrate responsible stewardship of resources to raise
awareness and educate our businesses, employees, residents, and community to enhance a sustainable
region; and
WHEREAS, the City of Troy recognizes the importance of a well-known regional sustainability program
such as the Dayton Regional Green 3 in attracting companies, workforce, and people to the area; and
WHEREAS, the City of Troy agrees that it is in the best interest of the City to support regional efforts to
achieve community goals for a balanced approach to long term quality of life for a sustainable region;
NOW, THEREFORE, BE IT RESOLVED BY the Council of the City of Troy, Ohio, as follows:
SECTION 1: That the Troy City Council supports feasible and cost effective efforts that enhance
regional sustainability.
SECTION II: That the Troy City Council recognizes and supports the Miami Valley's mission to
promote green government, business, and personal practices to ensure the sustainability of our region and its
natural resources and to enhance the quality of life for our citizens.
SECTION Ill: That the Troy City Council challenges its businesses and residents, where cost effective
and reasonable, to improve practices so that the community can achieve the goals listed in Sections IV and V
below.
SECTION IV: That the City of Troy will pursue goals that support regional sustainability and the
Dayton Regional Green 3 efforts over the next three years by challenging the community to help meet regional
goals including but not limited to:
a. 1,500 Certified Green Businesses with energy benchmarking for 200 buildings;
b. 30,000 Facebook fans;
c. 25% residential/commercial recycling rate for all of Miami County;
d. 100,000 trees planted;
e. 50 new community/school gardens/urban agriculture sites;
f. 50 sites that incorporate sustainable practices such as rain gardens, green roofs, or parking lots
with pervious surfaces; and,
g. Development and/or redevelopment of riverfront corridor amenities to promote economic
development, including adding 1 new or improved water trail access site, 3 bike trail
connections, and increasing by 10% the number of cyclists using trails.
SECTION V: That the City of Troy will encourage the green efforts included below, where cost
effective and reasonable but which are less measurable but worth encouraging:
a. Conserve or restore additional greenspace, stream or river bank areas;
b. Revise development policies (codes, ordinances, regulations) that encourage sustainable
practices by land users and developers;
c. Install Compressed Natural Gas (CNG) and electric vehicle charging stations
d. Purchase CNG and/or electric vehicles;
e. Encourage increased recycling and composting efforts by businesses;
f. Extend miles of bike trails and host events to promote alternative transportation such as 'Bike
to Work Day';
g. Achieve silver level certification as a Bicycle Friendly Community;
h. Support recycling events at public parks;
i. Create energy benchmarking for public buildings;
j. Promote new LEED buildings;
k. Implement Green Streets principles;
I. Add walkability design standards to all new buildings;
m. Develop and implement green purchasing policies;
n. Promote residential on-site com posting through educational programs;
o. Implement municipal code revisions that allow for habitat friendly landscaping and natural
growth areas;
p. Partner with regional storm water management entities to educate residents/businesses about
watershed protection; and
q. Create natural habitats on city and/or county owned property.
SECTION VI: That the City of Troy will, when representatives are available, join the Greater Dayton
Region in participating in media promotions to share common sustainability topics, such as energy conservation
actions, pushes to other networks, and sharing of accomplishments during Earth Day events, to employees,
residents, jurisdictions, institutions, and businesses.
SECTION VII: That this Resolution shall be effective at the earliest date allowed by law.
Adopted: ____________ _
President of Council
Approved: ____________ _
Attest:
Clerk of Council Mayor
Going Places Preferred Future Land Use Scenario:
O-Zone 1
Areas with the least dense
development and the least
amount of development
diversity.
The Concentrated Development VISION
Density & Diversity Index 2040
Divlnd40
Principles: Development in this scenario will be concentrated around regional
assets and in areas that already have the infrastructure to support it. The
rehabilitation and/or repurposing of vacant and underused structures would
be encouraged, along with a more broad commitment to infill development -
whether it makes use of existing structures or vacant lots. The preservation of
agricultural land and other open space would be a priority, upon agreement by
the property owner, as well as encouraging more connection and cooperation
between the Region's communities.
- DZ-3
- oz...,,
.. 1 0 1 ~ 5
D.Zone 2
Areas with a moderate
density level and small-to-
moderate levels of develop-
ment diversity.
.. .
.... ;
~ ........
~
Characteristics:
Encourage the rehabilitation and/or
repurposing of existing structures.
Focus on the maintenance of
existing infrastructure (roads, water,
sewer, etc.).
Locate any new development in areas
with existing infrastructure (roads, water,
sewer. etc.).
Revive the Region's older communities.
Preserve prime farmland and support
agricultural enterprise.
Improve the quality of educational
opportunities throughout the Region.
Foster a sense of connection and
cooperation between the Region's
communities.
Increase the number and quality of
transportation options.
. . . .
Encourage development around the
Region's assets.
Encourage the rehabilitation and/or
reuse of vacant industrial sites.
Encourage energy-efficient building
practices and the retrofitting of older
structures for energy efficiency.
Use land in a way that builds a sense of
community.
Maintain and expand the Region's
parks, natural areas, and recreation
amenities (recreation centers, bikeways,
rivers, etc.).
Encourage the development of quality,
realistic affordable housing throughout
the Region.
Revive the Region's core city - the City
of Dayton.
I
Areas that may be either less
dense with a higher diversity
or more dense with a lower
development diversity.
Areas with higher density
levels and higher levels of
development diversity.
Areas that are both dense
and diverse, containing at
least two types or develop-
ment.