Item 4I
TXU Energy Contract
Item 4I
Good evening Mayor and City Council this item on the consent agenda is asking for your consideration of a TXU Energy Contract.
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Requested Action
Approve a contract with TXU Energy to provide electric services for the term of June 2018 to December 2027
More specifically the purpose for this item is to seek City Council approval of a contract with TXU Energy to provide electric services for the term of June 2018 to December 2027.
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Background
2007
2011
2014
$0.0805/kwh
100% Traditional Energy
$0.0685/kwh
10% Renewable/
90% Traditional Energy
$0.0498/kwh
25% Renewable/
75% Traditional Energy
For your information the City has maintained a fixed rate agreement to purchase electricity from TXU Energy since 2007, and has negotiated several new agreements since then when rates
have become favorable to do so. The following agreements and subsequent rates shown on this slide have been made with TXU. Notice the focus to incorporate more renewable energy into
each agreement as it made economical sense to do so. This also falls in line with one of our strategic corporate objectives to deliver city services through sustainable business practices.
Also,
the current agreement is set to expire in May 2018.
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Proposed Agreement
Renewable energy Increases from 25% to 100%
TXU has invited the City to be a part of a new program created for its more fiscally responsible customers that would allow the City to purchase all of its ONCOR provided electricity
from a new solar energy plant (which is a renewable energy source). This slide shows the benefits of participating in this proposal. This program would be at a lower rate per kilowatt
hour and for a longer term than has ever been offered to the City. The proposed contract would allow the City to secure a reduced rate for electric services when the current contract
expires in May 2018. Taking action at this time will allow the City to establish a lower fixed rate for future energy costs while rates in the market are low. Electric rates have only
been this low twice before since deregulation of the Texas electricity market occurred in 2002.
City staff has been monitoring the market and talking with our benchmark cities to compare
rates. Until this point staff has not seen a lower rate among other DFW municipalities. Staff recommends entering into an agreement with TXU Energy because their rate is the lowest to
others that were quoted and it increases the percentage of renewable energy being purchased.
TXU Energy’s ongoing level of customer service and responsiveness to the City’s needs has
also been greatly appreciated. TXU has also been a great partner outside of just providing the City electricity. They provide trees to the City on an annual basis to beautify parks and
open spaces, and have recently offered to provide the City electric auto charging stations in public spaces, which is currently being reviewed by staff.
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City of Southlake Strategy Map
Critical Business Outcomes
CBO1 - Continue to implement Southlake 2030 Plan by focusing on short-term initiatives.
CBO2 - Become an employer of choice by developing a plan to recruit,
develop and retain employees committed to excellence.
CBO3 - Develop long-term strategies to address future financial uncertainties and challenges.
CBO4 - Improve mobility by proactively
completing traffic analysis of key areas.
CBO5 -Optimize resources through collaboration and partnerships to reduce costs and add service value.
The City of Southlake provides municipal services that support the highest quality of life for our residents, businesses, and visitors. We do this by being an exemplary model of balancing
efficiency, fiscal responsibility, transparency, and sustainability.
Deliver on Our Focus Areas
Performance
Management &
Service Delivery
C1 Achieve the highest standards of safety & security
C2 Provide travel convenience within City & region
C3 Provide attractive & unique spaces for enjoyment of personal interests
C4 Attract & keep top-tier businesses to drive a dynamic & sustainable economic environment
C5 Promote opportunities for partnerships & volunteer involvement
Serve our Customers
Manage the Business
B1 Achieve best-in-class status in all City disciplines
B2 Collaborate with select partners to implement service solutions
B3 Enhance resident quality of life & business vitality through tourism
B4 Provide high quality services through sustainable business practices
B5 Enhance service delivery through continual process improvement
B6 Optimize use of technology
Provide Financial Stewardship
Promote Learning and Growth
F1 Adhere to financial management principles & budget
F2 Invest to provide & maintain high quality public assets
F3 Achieve fiscal wellness standards
F4 Establish & maintain effective internal controls
L1 Ensure our people understand the strategy & how they contribute to it
L2 Enhance leadership capabilities to deliver results
L3 Attract, develop & retain a skilled workforce
L4 Recognize & reward high performers
L5 Empower informed decision-making at all levels in the organization
C6 Enhance the sense of
community by providing excellent customer service and citizen engagement opportunities
L6 Foster positive employee engagement
Performance
Management &
Service Delivery
B4 Provide high quality services through sustainable business practices
The proposed contract aligns with the City Strategy Map under the Focus Area “Performance Management & Service Delivery” and Corporate Objective “B4 Provide high quality services through
sustainable business practices.”
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Questions?
Ben Thatcher at 817-748-8005
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For questions please contact Ben Thatcher