RES 2006-09TOWN OF TROPHY CLUB, TEXAS
RESOLUTION 2006-09
A RESOLUTION OF THE TOWN OF TROPHY CLUB, TEXAS,
AUTHORIZING THE CITIES AGGREGATION POWER
PROJECT, INC. TO NEGOTIATE AN ELECTRIC SUPPLY
AGREEMENT FOR DELIVERIES OF ELECTRICITY
EFFECTIVE JANUARY 1, 2007; AUTHORIZING CAPP TO ACT
AS AN AGENT ON BEHALF OF THE TOWN TO ENTER INTO A
CONTRACT FOR ELECTRICITY; AUTHORIZING THE
CHAIRMAN OF CAPP TO EXECUTE AN ELECTRIC SUPPLY
AGREEMENT FOR DELIVERIES OF ELECTRICITY
EFFECTIVE JANUARY 1, 2007; AND COMMITTING TO
BUDGET FOR ENERGY PURCHASES IN 2007 AND 2008 AND TO
HONOR THE TOWN OF TROPHY CLUB'S COMMITMENTS TO
PURCHASE POWER FOR ITS ELECTRICAL NEEDS IN 2007
AND 2008 THROUGH CAPP.
WHEREAS, the Town of Trophy Club, Texas is a member of Cities
Aggregation Power Project, Inc. (CAPP), a nonprofit political subdivision corporation
dedicated to securing electric power for its more than 86 members in the competitive
retail market; and
WHEREAS, CAPP has negotiated favorable contract terms and a reasonable
commodity price for delivered electricity since 2002 resulting in significant savings off of
the Price to Beat (PTB) rate for its members; and
WHEREAS, the CAPP Board and CAPP consultants are continuing to
investigate long term contracting options, CAPP members must secure short term (2007
and 2008) power supplies or revert to high price standard contracts and independently
shop for a power contract; and
WHEREAS, experience gained by the CAPP Board indicates that entering into a
wholesale power contract, as distinct from a retail contract, effective January 1,2007 may
provide for the greatest potential savings for CAPP members and facilitate an ultimate
transition to fixed price long term agreements; and
WHEREAS, potential wholesale power providers desire to execute a contract
with one, and only one, entity rather than have unique contracts for each CAPP member;
and
WHEREAS, CAPP believes that the pricing opportunity window for favorable
2007 deliveries under either a wholesale or retail agreement will be short-lived (in the
late spring - early summer time period) and that CAPP must be able to commit
contractually to prices within a 24-hour period in order to lock-in favorable prices; and
WHEREAS, experiences in contracting for CAPP load since 2002 demonstrated
that Retail Electric Providers demand immediate response to an offer and may penalize
delay with higher prices; and
WHEREAS, CAPP's current delivered energy prices provide savings when
measured against the PTB rate, and aggregated rates contracted during favorable pricing
periods are likely to be lower than prices obtained by the Town contracting individually
during the same time period; and
WHEREAS, wholesale suppliers demand assurance that CAPP will pay for all
contracted load; and
WHEREAS, the Town of Trophy Club needs to assure CAPP that it will budget
for energy purchases in 2007 and 2008 and honor its commitments to purchase power for
its electrical needs in 2007 and 2008 through CAPP.
NOW, THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF
THE TOWN OF TROPHY CLUB, TEXAS:
Section 1. That the CAPP Board and its consultants and advisors are agents
authorized to negotiate for the City's electricity needs as a member of CAPP and to
evaluate wholesale power supply contract options for 2007 as compared to a retail
electric delivery contract for 2007 and, if feasible, 2008.
Section 2. That the Chairman of CAPP is hereby authorized to sign an electric
power agreement for the City pursuant to the contract approved and recommended by the
CAPP Board of Directors within 24 hours of said approval and recommendation.
Section 3. That the City will budget and approve funds necessary to pay
electricity costs proportionate to the City's load under the supply agreement (whether
wholesale or retail) arranged by CAPP and signed by the Chairman of CAPP for the City.
Section 4. That a copy of the resolution shall be sent to Mary Bunkley with the
City Attorney's office in Arlington and Geoffrey M. Gay, legal counsel to CAPP.
PASSED AND APPROVED by the Town Council of the Town of Trophy Club,
Texas on this the 19'~ day of June 2006.
Nick Sanders
Mayor, Town of Trophy Club, Texas
ATTEST:
Town Secretary,
Town of Trophy Club, Texas
[Seal]
APPROVED AS TO FORM:
Town Attorney,
Town of Trophy Club, Texas