[PAGE 1] BOARD OF PUBLIC WORKS DEPARTMENT OF UTILITIES January 4, 2017 4:15 P.M. Fremont Municipal Building, 2nd Floor Conference Room, 400 East Military, Fremont Nebraska __________________________________________________________________________ 1. Roll call. 2. Approve minutes of December 21, 2016. 3. Consider Accounts Payable – 1st half of January 2017. 4. * Consider open season bid with Northern Natural Gas for additional Firm Deferred Delivery Service Storage (staff report). 5. Consider Clawback Provisions and Indemnification Agreement with Costco Wholesale Corp. (staff report). 6. Investments (staff report). 7. General Manager Update (no board action is requested). a. Annual report – Keith Kontor b. Public Power in Nebraska – Newton 8. Adjournment The agenda was posted at the Municipal Building on December 28, 2016. The agenda and enclosures are distributed to Board and posted on the City of Fremont’s website. The official current copy of the agenda is available at Municipal Building, 400 East Military, office of the General Manager. A copy of the Open Meeting Law is posted in the 2nd floor conference room for review by the public. The Board of Public Works reserves the right to adjust the order of items on this agenda. *items referred to City Council (if any) Page 1 [PAGE 2] CITY OF FREMONT BOARD OF PUBLIC WORKS DECEMBER 21, 2016 - 4:15 P.M. A meeting of the Board of Public Works was held on December 21, 2016 at 4:15 p.m. in the 2nd floor meeting room at 400 East Military, Fremont, Nebraska. The meeting was preceded by publicized notice in the Fremont Tribune and the agenda displayed in the Municipal Building. The meeting was open to the public. A continually current copy of the agenda was available for public inspection at the office of the General Manger, Department of Utilities, 400 East Military. The agenda was distributed to the Board of Public Works on December 19, 2016, and posted, along with the supporting documents, on the City’s website. A copy of the open meeting law is posted continually for public inspection. ROLL CALL. Roll call showed Board Members Sawtelle, Shelso, Vering, Behrens and Hoegemeyer present; 5 present, 0 absent. Others in attendance included City Councilman Steve Landholm, City Councilwoman Susan Jacobus; Troy Schaben, Asst. GM; Jan Rise, Admin. Services Dir.; Jeff Shanahan, LDW Supt.; Dan Goebel, Accountant; Larry Andreasen, Water Supt.; Al Kasper, Dir. of Engineering; John Hemschemeyer, Dir. HR; Keith Kontor, WWTP Supt.; Mike Royuk, Electric Superintendent; and Dean Kavan, Stores Supervisor. APPROVE MINUTES. Moved by Member Vering and seconded by Member Behrens to approve the minutes of the December 7, 2016 meeting. Motion carried 5-0. CONSIDER ACCOUNTS PAYABLE – 2nd HALF OF DECEMBER 2016. Moved by Member Shelso and seconded by Member Hoegemeyer to approve the accounts payable in the amount of $2,411,634.21. Motion carried 5-0. REVIEW COLLECTION REPORT FOR NOVEMBER 2016. Chairman Sawtelle noted the board reviewed and received the November 2016 collections report. CONSIDER PURCHASE OF 2018 FREIGHTLINER/2017 VACTOR 2100 FROM NEBRASKA ENVIRONMENTAL PRODUCTS. Moved by Member Behrens and seconded by Member Shelso to approve the purchase of a 2018 Freightliner and 2017 Vactor 2100 jet pump for $453,256 from Nebraska Environmental Products using the National Joint Powers Alliance (NJPA) contract; and recommend approval by the City Council. Andreasen reviewed some of the reasons the Vactor jet pump was preferred and the advantages of using the NJPA. Motion carried 5-0. CONSIDER EXTENSION OF POWER MARKETING AGENT/METERING/COMMUNICATIONS AGREEMENT WITH OPPD. Moved by Member Vering and seconded by Member Hoegemeyer to renew the power marketing agent/metering/communications agreement with OPPD for another year at the cost of $11,508.15 per month (a 2% increase over the prior year). Shanahan explained the purpose of the agreement and why staff recommended renewing the agreement. Motion carried 5-0. INVESTMENTS. Goebel reviewed the investments staff had made since the last board meeting. Member Vering moved to accept and receive the report, seconded by Member Behrens. Motion carried 5-0. GENERAL MANAGER UPDATE. Kasper and Royuk presented the annual electric engineering and distribution system report and reviewed the information with the board. Newton reviewed a draft letter from OPPD detailing what it Page 2 1 Agenda Item #2 [PAGE 3] would cost to reroute and bury a portion of the proposed Elkhorn River Valley Transmission line to avoid the aesthetics of the line along Ritz Lake. The Board noted its acceptance to underground construction as long as all additional costs are to be paid by the developer. Newton explained the Northern Natural Gas (NNG) open season for additional Firm Deferred Delivery (FDD) storage. Currently FDU has 305,000 MMBtu of storage or approximately 13% of average annual gas sales. With the possibility of the Costco load, Newton asked the Board to consider authorizing staff to bid for additional storage, noting that if the bid was successful, the allocation could always be turned back into NNG without penalty. The item will be placed on next month’s agenda. Kontor updated the board on the progress of updating the wastewater treatment plant and Hormel’s commitment to install pretreatment. ADJOURNMENT Member Behrens moved and Member Shelso seconded the motion to adjourn the meeting at 5:30 p.m. Motion carried 5-0. ________________________________ ______________________________ Allen Sawtelle, Chairman Toni Vering, Secretary Approved by: ______________________ ______________________ ___________________ Dennis Behrens David Shelso Erik Hoegemeyer Page 3 2 Agenda Item #2 [PAGE 4] PREPARED 12/28/2016 12:13:29 EXPENDITURE APPROVAL LIST PROGRAM: GM339L REPORT PARAMETER SELECTIONS EAL DESCRIPTION: EAL: 12282016 ANDERSEND PAYMENT TYPES Checks . . . . . . . . . . . . . . . . . . . . . Y EFTs . . . . . . . . . . . . . . . . . . . . . . Y ePayables . . . . . . . . . . . . . . . . . . . Y VOUCHER SELECTION CRITERIA Voucher/discount due date . . . . . . . . . . . 12/29/2016 All banks . . . . . . . . . . . . . . . . . . . A REPORT SEQUENCE OPTIONS: Vendor . . . . . . . . . . . . . . . . . . . . . X One vendor per page? (Y,N) . . . . . . . . . . N Bank/Vendor . . . . . . . . . . . . . . . . . . One vendor per page? (Y,N) . . . . . . . . . . N Fund/Dept/Div . . . . . . . . . . . . . . . . . Validate cash on hand? (Y,N) . . . . . . . . . N Fund/Dept/Div/Element/Obj . . . . . . . . . . . Validate cash on hand? (Y,N) . . . . . . . . . N Proj/Fund/Dept/Div/Elm/Obj . . . . . . . . . . . This report is by: Vendor Process by bank code? (Y,N) . . . . . . . . . . Y Print reports in vendor name sequence? (Y,N) . . Y Calendar year for 1099 withholding . . . . . . . 2016 Disbursement year/per . . . . . . . . . . . . . 2017/03 Payment date . . . . . . . . . . . . . . . . . . 12/28/2016 Page 4 Agenda Item #3 [PAGE 5] PREPARED 12/28/2016,12:13:29 EXPENDITURE APPROVAL LIST PAGE 1 PROGRAM: GM339L AS OF: 12/29/2016 PAYMENT DATE: 12/28/2016 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 9999999 00 BOYER, JORDON G 000072221 UT 00 12/22/2016 051-0000-143.00-00 FINAL BILL REFUND 107.75 VENDOR TOTAL * 107.75 0000584 00 CEI 20161229 PR1229 00 12/29/2016 051-0000-241.00-00 PAYROLL SUMMARY EFT: 4,144.44 VENDOR TOTAL * .00 4,144.44 9999999 00 FERGUSON, STEFANIE L 000072125 UT 00 12/22/2016 051-0000-143.00-00 FINAL BILL REFUND 165.62 VENDOR TOTAL * 165.62 0001964 00 IBEW LOCAL UNION 1536 20161201 PR1201 00 12/29/2016 051-0000-241.00-00 PAYROLL SUMMARY 1,785.01 20161215 PR1215 00 12/29/2016 051-0000-241.00-00 PAYROLL SUMMARY 1,785.01 VENDOR TOTAL * 3,570.02 0002999 00 LAUGHLIN TRUSTEE, KATHLEEN A 20161229 PR1229 00 12/29/2016 051-0000-241.00-00 PAYROLL SUMMARY 162.00 VENDOR TOTAL * 162.00 0005002 00 NATIONAL ACCOUNT SYSTEMS OF OMAHA 20161229 PR1229 00 12/29/2016 051-0000-241.00-00 PAYROLL SUMMARY 239.29 VENDOR TOTAL * 239.29 0004192 00 PAYROLL EFT DEDUCTIONS 20161229 PR1229 00 12/29/2016 051-0000-241.00-00 PAYROLL SUMMARY 182,707.79 VENDOR TOTAL * 182,707.79 9999999 00 RAY, RUSSELL & ABBIE 000030097 UT 00 12/22/2016 051-0000-143.00-00 FINAL BILL REFUND 125.67 VENDOR TOTAL * 125.67 9999999 00 SCHWARTZ, CODY L 000072893 UT 00 12/22/2016 051-0000-143.00-00 FINAL BILL REFUND 20.76 VENDOR TOTAL * 20.76 9999999 00 SIBBALD, TOM 000071969 UT 00 12/22/2016 051-0000-143.00-00 FINAL BILL REFUND 16.09 VENDOR TOTAL * 16.09 9999999 00 TOWN & COUNTRY PROPERTIES, LLC 000069021 UT 00 12/22/2016 051-0000-143.00-00 FINAL BILL REFUND 96.82 VENDOR TOTAL * 96.82 9999999 00 VANEK, CARLIE A 000071017 UT 00 12/22/2016 051-0000-143.00-00 FINAL BILL REFUND 228.99 VENDOR TOTAL * 228.99 EFT/EPAY TOTAL *** 4,144.44 Page 5 Agenda Item #3 [PAGE 6] PREPARED 12/28/2016,12:13:29 EXPENDITURE APPROVAL LIST PAGE 2 PROGRAM: GM339L AS OF: 12/29/2016 PAYMENT DATE: 12/28/2016 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 9999999 00 TOTAL EXPENDITURES **** 187,440.80 4,144.44 GRAND TOTAL ******************** 191,585.24 Page 6 Agenda Item #3 [PAGE 7] Prepared 12/28/16, 10:57:33 CITY OF FREMONT Page 33 Pay Date 12/29/16 Direct Deposit Register Primary FIRST NATIONAL BANK Program PR530L ------------------------------------------------------------------------------------------------------------------------------------ Account Social Deposit Number Employee Name Security Amount ------------------------------------------------------------------------------------------------------------------------------------ Final Total 281,671.99 Count 172 Page 7 Agenda Item #3 [PAGE 8] DEPARTMENT OF UTILITIES ELECTRONIC WITHDRAWAL LIST FOR BOARD OF PUBLIC WORKS MEETING: 1/4/17 AJ WITHDRAWAL WITHDRAWAL GROUP NO VENDOR NAME DATE ACCOUNT NO ITEM DESCRIPTION AMOUNT 5606 VANTIV 12/20/16 051-5001-903-60-77 KIOSK CREDIT CARD FEES 13.20 TOTAL EXPENDITURES 13.20 Page 8 M:\Accounts Payable\DU\DU Electronic Withdrawals\12-20-16 Agenda Item #3 [PAGE 9] PREPARED 12/29/2016 11:20:19 EXPENDITURE APPROVAL LIST PROGRAM: GM339L REPORT PARAMETER SELECTIONS EAL DESCRIPTION: EAL: 12292016 ANDERSEND PAYMENT TYPES Checks . . . . . . . . . . . . . . . . . . . . . Y EFTs . . . . . . . . . . . . . . . . . . . . . . Y ePayables . . . . . . . . . . . . . . . . . . . Y VOUCHER SELECTION CRITERIA Voucher/discount due date . . . . . . . . . . . 01/05/2017 All banks . . . . . . . . . . . . . . . . . . . A REPORT SEQUENCE OPTIONS: Vendor . . . . . . . . . . . . . . . . . . . . . X One vendor per page? (Y,N) . . . . . . . . . . N Bank/Vendor . . . . . . . . . . . . . . . . . . One vendor per page? (Y,N) . . . . . . . . . . N Fund/Dept/Div . . . . . . . . . . . . . . . . . Validate cash on hand? (Y,N) . . . . . . . . . N Fund/Dept/Div/Element/Obj . . . . . . . . . . . Validate cash on hand? (Y,N) . . . . . . . . . N Proj/Fund/Dept/Div/Elm/Obj . . . . . . . . . . . This report is by: Vendor Process by bank code? (Y,N) . . . . . . . . . . Y Print reports in vendor name sequence? (Y,N) . . Y Calendar year for 1099 withholding . . . . . . . 2017 Disbursement year/per . . . . . . . . . . . . . 2017/04 Payment date . . . . . . . . . . . . . . . . . . 01/05/2017 Page 9 Agenda Item #3 [PAGE 10] PREPARED 12/29/2016,11:20:19 EXPENDITURE APPROVAL LIST PAGE 1 PROGRAM: GM339L AS OF: 01/05/2017 PAYMENT DATE: 01/05/2017 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 0000957 00 AAA GARAGE DOOR INC 16-2960 PI1482 00 01/05/2017 051-5001-940.50-35 PO NUM 043515 9.64 16-2960 PI1483 00 01/05/2017 051-5001-940.60-61 PO NUM 043515 128.99 16-2972 PI1584 00 01/05/2017 051-5001-940.50-35 PO NUM 044728 65.28 16-2972 PI1585 00 01/05/2017 051-5001-940.60-61 PO NUM 044728 109.00 16-3023 PI1625 00 01/05/2017 051-5001-940.50-35 PO NUM 044783 10.05 16-3023 PI1626 00 01/05/2017 051-5001-940.60-61 PO NUM 044783 119.65 VENDOR TOTAL * 442.61 0000959 00 ACE HARDWARE 98669/3 PI1484 00 01/05/2017 051-5001-940.50-35 PO NUM 043953 101.61 98730/3 PI1485 00 01/05/2017 051-5001-940.50-35 PO NUM 043953 156.54 98737/3 PI1487 00 01/05/2017 051-5001-940.50-35 PO NUM 043953 28.86 98772/3 PI1598 00 01/05/2017 051-5001-940.50-35 PO NUM 043953 91.87 98731/3 PI1486 00 01/05/2017 051-5105-502.50-35 PO NUM 043953 2.45 98741/3 PI1523 00 01/05/2017 055-7105-512.50-35 PO NUM 044742 69.99 VENDOR TOTAL * 451.32 0004995 00 ACME CONTROLS 983143 PI1612 00 01/05/2017 055-7105-512.50-35 PO NUM 044650 275.00 VENDOR TOTAL * 275.00 0000960 00 ADAMS OIL INC 16594 PI1623 00 01/05/2017 055-7105-502.50-30 PO NUM 044768 EFT: 3,202.10 VENDOR TOTAL * .00 3,202.10 0004920 00 ADVANCED ELECTRICAL AND MOTOR AEM-16-3262 PI1512 00 01/05/2017 051-5105-502.60-61 PO NUM 044673 EFT: 5,119.84 AEM-16-3262 PI1513 00 01/05/2017 051-5105-502.60-79 PO NUM 044673 EFT: 152.38 VENDOR TOTAL * .00 5,272.22 0004276 00 AIRGAS USA LLC 9058250553 PI1597 00 01/05/2017 051-5105-502.50-35 PO NUM 036774 EFT: 228.96 9058477045 PI1606 00 01/05/2017 051-5105-502.50-35 PO NUM 044169 EFT: 1,399.50 9058477045 PI1607 00 01/05/2017 051-5105-502.50-35 PO NUM 044169 EFT: 739.12 VENDOR TOTAL * .00 2,367.58 0000967 00 ALLIED APPLIANCE INC 57287 PI1515 00 01/05/2017 055-7105-512.50-35 PO NUM 044682 549.00 57287 PI1516 00 01/05/2017 055-7105-512.60-61 PO NUM 044682 80.00 VENDOR TOTAL * 629.00 0003124 00 ALLIED ELECTRONICS INC 9007055470 PI1596 00 01/05/2017 055-0000-154.00-00 PO NUM 044741 EFT: 468.92 VENDOR TOTAL * .00 468.92 0002612 00 ALTEC INDUSTRIES INC 10670882 PI1514 00 01/05/2017 051-5205-580.50-35 PO NUM 044675 1,424.13 VENDOR TOTAL * 1,424.13 0002228 00 AMERICAN WATER WORKS ASSOCIATION Page 10 Agenda Item #3 [PAGE 11] PREPARED 12/29/2016,11:20:19 EXPENDITURE APPROVAL LIST PAGE 2 PROGRAM: GM339L AS OF: 01/05/2017 PAYMENT DATE: 01/05/2017 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 0002228 00 AMERICAN WATER WORKS ASSOCIATION 7001267194 PI1624 00 01/05/2017 053-6001-905.60-67 PO NUM 044769 3,361.00 VENDOR TOTAL * 3,361.00 0000583 00 ANCHOR SCIENTIFIC INC 225180 PI1479 00 01/05/2017 051-0000-155.00-00 PO NUM 044725 402.00 225180 PI1522 00 01/05/2017 051-5105-502.60-79 PO NUM 044725 19.49 VENDOR TOTAL * 421.49 0002531 00 BABCOCK & WILCOX BA60333056 PI1595 00 01/05/2017 051-0000-153.00-00 PO NUM 044698 EFT: 8,078.50 VENDOR TOTAL * .00 8,078.50 0001662 00 BARR-THORP ELECTRIC CO INC S1433694-001 PI1557 00 01/05/2017 051-5105-502.60-65 PO NUM 044428 2,949.99 VENDOR TOTAL * 2,949.99 0003660 00 BAUER BUILT INC 880049540 PI1613 00 01/05/2017 055-7105-502.50-48 PO NUM 044676 422.00 880049540 PI1614 00 01/05/2017 055-7105-502.60-61 PO NUM 044676 50.00 880048884 PI1615 00 01/05/2017 057-8205-870.50-48 PO NUM 044690 256.53 880048884 PI1616 00 01/05/2017 057-8205-870.60-61 PO NUM 044690 27.70 880049553 PI1618 00 01/05/2017 057-8205-870.50-48 PO NUM 044729 278.26 880049553 PI1619 00 01/05/2017 057-8205-870.60-61 PO NUM 044729 28.37 VENDOR TOTAL * 1,062.86 0005009 00 BDO USA LLP 000742633 00 01/05/2017 051-0000-173.00-00 Nov/Turbine Damage Claim 7,625.00 VENDOR TOTAL * 7,625.00 0004558 00 BLT PLUMBING HEATING & A/C INC 13206 PI1605 00 01/05/2017 055-7105-512.50-35 PO NUM 044004 62.07 VENDOR TOTAL * 62.07 0003545 00 BOMGAARS SUPPLY INC 16196652 PI1488 00 01/05/2017 051-5001-940.50-35 PO NUM 043954 37.44 16197382 PI1489 00 01/05/2017 051-5105-502.50-35 PO NUM 043954 114.46 16198557 PI1490 00 01/05/2017 055-7105-512.50-35 PO NUM 043954 44.95 VENDOR TOTAL * 196.85 0004996 00 BRIGGS AND MORGAN PA 591184 PI1617 00 01/05/2017 051-5001-919.60-61 PO NUM 044713 6,772.50 VENDOR TOTAL * 6,772.50 0004518 00 CAPPEL AUTO SUPPLY INC 204325 PI1602 00 01/05/2017 051-5001-940.50-35 PO NUM 043990 212.93 204414 PI1603 00 01/05/2017 051-5001-940.50-48 PO NUM 043990 161.51 203240 PI1611 00 01/05/2017 051-5001-940.50-48 PO NUM 044606 376.43 204201 PI1600 00 01/05/2017 051-5105-502.50-48 PO NUM 043990 230.62 204294 PI1601 00 01/05/2017 051-5205-580.50-48 PO NUM 043990 156.40 Page 11 Agenda Item #3 [PAGE 12] PREPARED 12/29/2016,11:20:19 EXPENDITURE APPROVAL LIST PAGE 3 PROGRAM: GM339L AS OF: 01/05/2017 PAYMENT DATE: 01/05/2017 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 0004518 00 CAPPEL AUTO SUPPLY INC 204488 PI1604 00 01/05/2017 055-7205-583.50-48 PO NUM 043990 131.88 VENDOR TOTAL * 1,269.77 0003817 00 CED AUTOMATION OMAHA 5411-492840 PI1477 00 01/05/2017 051-0000-155.00-00 PO NUM 044686 57.87 5411-492934 PI1594 00 01/05/2017 051-0000-155.00-00 PO NUM 044686 264.20 5411-492915 PI1478 00 01/05/2017 055-0000-154.00-00 PO NUM 044691 167.04 VENDOR TOTAL * 489.11 0002675 00 CENTURYLINK 4027272600 1216PI1549 00 01/05/2017 051-5001-922.50-53 PO NUM 043996 48.12 4027272606 1216PI1550 00 01/05/2017 051-5001-922.50-53 PO NUM 043996 408.72 4027272654 1216PI1551 00 01/05/2017 051-5001-922.50-53 PO NUM 043996 48.54 VENDOR TOTAL * 505.38 0002915 00 CREDIT BUREAU SERVICES INC NOV 2016 PI1521 00 01/05/2017 055-7001-905.55-04 PO NUM 044721 125.00 VENDOR TOTAL * 125.00 0004646 00 DATABANK IMX LLC MO41000652 PI1518 00 01/05/2017 051-5001-922.60-65 PO NUM 044695 9,719.20 VENDOR TOTAL * 9,719.20 0003586 00 DHHS LICENSURE UNIT 2017 N HRBEK PI1588 00 01/05/2017 053-6205-583.60-67 PO NUM 044740 115.00 VENDOR TOTAL * 115.00 0000313 00 DIAMOND POWER INTERNATIONAL INC 489894 PI1593 00 01/05/2017 051-0000-153.00-00 PO NUM 044660 1,730.20 VENDOR TOTAL * 1,730.20 0001313 00 DILLON CHEVROLET FREMONT INC, SID 1TCS121142 PI1664 00 01/05/2017 051-5205-580.60-61 PO NUM 043959 79.95 VENDOR TOTAL * 79.95 0001927 00 DOKTER TRUCKING CORP 2155 PI1608 00 01/05/2017 051-5105-502.60-61 PO NUM 044588 850.00 2302 PI1609 00 01/05/2017 051-5105-502.60-61 PO NUM 044588 1,000.00 2326 PI1610 00 01/05/2017 051-5105-502.60-61 PO NUM 044588 925.00 2177 PI1643 00 01/05/2017 051-5105-502.60-61 PO NUM 044588 650.00 VENDOR TOTAL * 3,425.00 0003321 00 DOUGLAS COUNTY TREASURER/LANDFILL 1171482 PI1586 00 01/05/2017 051-5001-940.60-61 PO NUM 044730 32.27 VENDOR TOTAL * 32.27 0004605 00 DXP ENTERPRISES INC 48331088 PI1524 00 01/05/2017 051-0000-154.00-00 PO NUM 044038 EFT: 409.15 VENDOR TOTAL * .00 409.15 0003087 00 EAKES OFFICE SOLUTIONS Page 12 Agenda Item #3 [PAGE 13] PREPARED 12/29/2016,11:20:19 EXPENDITURE APPROVAL LIST PAGE 4 PROGRAM: GM339L AS OF: 01/05/2017 PAYMENT DATE: 01/05/2017 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 0003087 00 EAKES OFFICE SOLUTIONS S 136574 PI1558 00 01/05/2017 051-5001-932.60-65 PO NUM 044456 1,250.99 VENDOR TOTAL * 1,250.99 0004551 00 ELEMETAL FABRICATION LLC 21516 PI1599 00 01/05/2017 051-5001-940.50-35 PO NUM 043975 245.04 21495 PI1494 00 01/05/2017 051-5105-502.50-35 PO NUM 043975 244.92 VENDOR TOTAL * 489.96 0001091 00 EMANUEL PRINTING INC 8142 PI1511 00 01/05/2017 051-5001-903.50-40 PO NUM 044640 144.99 VENDOR TOTAL * 144.99 0004993 00 FIKES COMMERCIAL HYGIENE LLC 573 PI1495 00 01/05/2017 051-5001-932.60-61 PO NUM 044106 EFT: 164.78 VENDOR TOTAL * .00 164.78 0002168 00 FORNEY CORPORATION 403987 PI1591 00 01/05/2017 051-0000-155.00-00 PO NUM 044446 1,595.47 VENDOR TOTAL * 1,595.47 0004833 00 FREMONT AREA UNITED WAY NOV'16 CARESHAR 00 01/05/2017 055-0000-242.02-00 Nov 2016 Care & Share EFT: 281.51 VENDOR TOTAL * .00 281.51 0001124 00 FREMONT PRINTING CO 15037 PI1499 00 01/05/2017 051-5001-903.50-31 PO NUM 044256 77.15 15037 PI1500 00 01/05/2017 051-5001-917.50-31 PO# 044256 213.98 15037 PI1501 00 01/05/2017 051-5001-919.50-31 PO# 044256 25.66 15037 PI1502 00 01/05/2017 051-5001-920.50-31 PO# 044256 34.23 15037 PI1503 00 01/05/2017 051-5001-922.50-31 PO# 044256 25.66 15037 PI1504 00 01/05/2017 051-5001-926.50-31 PO# 044256 25.66 15037 PI1505 00 01/05/2017 051-5001-940.50-31 PO# 044256 34.23 15037 PI1506 00 01/05/2017 051-5205-580.50-31 PO# 044256 34.23 VENDOR TOTAL * 470.80 0003377 00 GEA MECHANICAL EQUIPMENT US INC 7586519608 PI1576 00 01/05/2017 055-7105-512.50-35 PO NUM 044696 7,273.74 VENDOR TOTAL * 7,273.74 0003102 00 GEORG FISCHER CENTRAL PLASTICS LLC 1790200 PI1592 00 01/05/2017 057-0000-154.00-00 PO NUM 044482 3,477.00 VENDOR TOTAL * 3,477.00 0002804 00 GOVERNMENT FINANCE OFFICERS ASSN 0166596 PI1507 00 01/05/2017 051-5001-920.60-67 PO NUM 044333 150.00 VENDOR TOTAL * 150.00 0004932 00 GRACE CONSULTING INC 6187 PI1481 00 01/05/2017 051-5105-502.60-61 PO NUM 043258 13,000.00 Page 13 Agenda Item #3 [PAGE 14] PREPARED 12/29/2016,11:20:19 EXPENDITURE APPROVAL LIST PAGE 5 PROGRAM: GM339L AS OF: 01/05/2017 PAYMENT DATE: 01/05/2017 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 0004932 00 GRACE CONSULTING INC VENDOR TOTAL * 13,000.00 0001445 00 GRAYBAR 988880380 PI1474 00 01/05/2017 051-0000-154.00-00 PO NUM 044296 601.70 988047958 PI1525 00 01/05/2017 051-0000-154.00-00 PO NUM 044274 1,547.00 988451322 PI1589 00 01/05/2017 051-0000-154.00-00 PO NUM 044314 1,120.70 988985403 PI1590 00 01/05/2017 051-0000-154.00-00 PO NUM 044314 439.20- VENDOR TOTAL * 2,830.20 0004707 00 GREAT PLAINS COMMUNICATIONS INC 4020010078 1216PI1496 00 01/05/2017 051-5001-922.50-53 PO NUM 044192 149.00 4020010078 1216PI1497 00 01/05/2017 051-5001-922.60-65 PO NUM 044192 500.00 4020010078 1216PI1498 00 01/05/2017 055-7105-502.60-76 PO NUM 044192 229.00 VENDOR TOTAL * 878.00 0003155 00 HACH COMPANY 10241141 PI1620 00 01/05/2017 055-7105-502.50-52 PO NUM 044743 825.73 10241141 PI1621 00 01/05/2017 055-7105-512.50-35 PO NUM 044743 50.12 VENDOR TOTAL * 875.85 0004419 00 HANSEN TIRE LLC 17392 PI1629 00 01/05/2017 051-5105-502.50-48 PO NUM 043963 106.24 17392 PI1630 00 01/05/2017 051-5105-502.60-61 PO NUM 043963 10.00 17403 PI1631 00 01/05/2017 051-5205-580.50-48 PO NUM 043963 219.75 VENDOR TOTAL * 335.99 0002794 00 HDR ENGINEERING INC 1200025586 PI1533 00 01/05/2017 053-6205-583.60-61 PO NUM 043936 9,468.48 1200025586 PI1534 00 01/05/2017 055-7205-583.60-61 PO NUM 043936 9,468.48 VENDOR TOTAL * 18,936.96 0004599 00 IBT INC 6926434 PI1627 00 01/05/2017 051-0000-154.00-00 PO NUM 044441 EFT: 571.85 6926433 PI1652 00 01/05/2017 055-7105-512.50-35 PO NUM 044716 EFT: 23.00 6926433 PI1653 00 01/05/2017 055-7105-512.50-35 PO NUM 044716 EFT: 775.56 VENDOR TOTAL * .00 1,370.41 0004264 00 INDUSTRIAL PIPE & SUPPLY LLC 60175-00 PI1509 00 01/05/2017 051-5105-502.50-35 PO NUM 044564 EFT: 563.09 60175-00 PI1510 00 01/05/2017 051-5105-502.60-79 PO NUM 044564 EFT: 107.00 VENDOR TOTAL * .00 670.09 0001833 00 INDUSTRIAL SALES CO INC D 965795-003 PI1475 00 01/05/2017 057-0000-154.00-00 PO NUM 044383 1,233.64 969275-000 PI1645 00 01/05/2017 057-8205-870.50-35 PO NUM 044647 439.08 969275-000 PI1646 00 01/05/2017 057-8205-870.60-61 PO NUM 044647 94.95 969275-000 PI1647 00 01/05/2017 057-8205-870.60-79 PO NUM 044647 22.94 VENDOR TOTAL * 1,790.61 0001687 00 INLAND TRUCK PARTS & SERVICE Page 14 Agenda Item #3 [PAGE 15] PREPARED 12/29/2016,11:20:19 EXPENDITURE APPROVAL LIST PAGE 6 PROGRAM: GM339L AS OF: 01/05/2017 PAYMENT DATE: 01/05/2017 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 0001687 00 INLAND TRUCK PARTS & SERVICE 6-26834 PI1519 00 01/05/2017 055-7105-512.50-35 PO NUM 044717 270.62 VENDOR TOTAL * 270.62 0003483 00 INTERSTATE CHEMCIAL CO INC 260362 PI1480 00 01/05/2017 051-5105-502.50-52 PO NUM 042699 3,206.15 VENDOR TOTAL * 3,206.15 0003085 00 KELLY SUPPLY CO 11117134-0 PI1648 00 01/05/2017 051-5105-502.50-35 PO NUM 044662 391.95 11117134-0 PI1649 00 01/05/2017 051-5105-502.60-79 PO NUM 044662 30.25 VENDOR TOTAL * 422.20 0004676 00 KIEWIT ENGINEERING & DESIGN CO 9000071425 PI1508 00 01/05/2017 051-5105-502.60-61 PO NUM 044516 6,650.93 VENDOR TOTAL * 6,650.93 9999999 00 KING, JEFF 120816 KING 00 01/05/2017 055-7205-583.50-01 Jeff King Crop Damage 661.50 VENDOR TOTAL * 661.50 0002902 00 KRIZ-DAVIS CO S101461592-006 PI1476 00 01/05/2017 051-0000-154.00-00 PO NUM 044612 EFT: 133.75 S101446595-001 PI1527 00 01/05/2017 051-0000-154.00-00 PO NUM 044558 EFT: 9,373.67 S101461806-001 PI1644 00 01/05/2017 051-5105-502.50-35 PO NUM 044627 EFT: 144.45 S101468658-001 PI1517 00 01/05/2017 051-5205-580.60-62 PO NUM 044688 EFT: 400.00 S101469710-001 PI1520 00 01/05/2017 051-5205-580.50-64 PO NUM 044718 EFT: 474.01 S101469728-001 PI1491 00 01/05/2017 053-6205-583.50-35 PO NUM 043965 EFT: 258.48 S101469905-001 PI1492 00 01/05/2017 055-7105-512.50-35 PO NUM 043965 EFT: 128.37 S101470229-001 PI1493 00 01/05/2017 055-7205-583.50-35 PO NUM 043965 EFT: 49.46 VENDOR TOTAL * .00 10,962.19 0002654 00 LEAGUE ASSN OF RISK MANAGEMENT 10539 PI1690 00 01/05/2017 051-5001-919.60-63 PO NUM 044808 3,194.02 10541 PI1691 00 01/05/2017 051-5001-919.60-63 PO NUM 044808 507.58- VENDOR TOTAL * 2,686.44 0004976 00 MARCO TECHNOLOGIES LLC INV3878140 PI1555 00 01/05/2017 051-5001-920.60-65 PO NUM 044364 119.28 VENDOR TOTAL * 119.28 0002052 00 MATHESON LINWELD 14583016 PI1642 00 01/05/2017 051-5001-950.80-50 PO NUM 044514 EFT: 9,405.30 VENDOR TOTAL * .00 9,405.30 0003289 00 MATT FRIEND TRUCK EQUIPMENT INC 0082383-IN PI1564 00 01/05/2017 051-5001-940.50-48 PO NUM 044643 550.67 0082383-IN PI1565 00 01/05/2017 051-5001-940.60-79 PO NUM 044643 24.28 VENDOR TOTAL * 574.95 0002963 00 MCGILL ASBESTOS ABATEMENT CO INC Page 15 Agenda Item #3 [PAGE 16] PREPARED 12/29/2016,11:20:19 EXPENDITURE APPROVAL LIST PAGE 7 PROGRAM: GM339L AS OF: 01/05/2017 PAYMENT DATE: 01/05/2017 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 0002963 00 MCGILL ASBESTOS ABATEMENT CO INC 114653 PI1692 00 01/05/2017 051-5001-932.60-61 PO NUM 044817 550.00 VENDOR TOTAL * 550.00 0001469 00 MCGRATH NORTH MULLIN & KRATZ PC LLO 450749 PI1628 00 01/05/2017 051-5105-502.60-61 PO NUM 041300 9,413.06 VENDOR TOTAL * 9,413.06 0000667 00 MCMASTER-CARR SUPPLY CO 93777563 PI1654 00 01/05/2017 051-5001-940.50-35 PO NUM 044745 423.26 93777563 PI1655 00 01/05/2017 051-5001-940.60-79 PO NUM 044745 33.25 92712110 PI1573 00 01/05/2017 051-5105-502.50-35 PO NUM 044685 152.31 92712110 PI1574 00 01/05/2017 051-5105-502.50-35 PO NUM 044685 29.90 92712110 PI1575 00 01/05/2017 051-5105-502.60-79 PO NUM 044685 8.10 VENDOR TOTAL * 646.82 0001229 00 MENARDS - FREMONT 21398 PI1535 00 01/05/2017 051-5001-940.50-35 PO NUM 043970 23.55 21482 PI1537 00 01/05/2017 051-5001-922.50-42 PO NUM 043970 154.08 21663 PI1540 00 01/05/2017 051-5001-922.50-42 PO NUM 043970 12.66 21706 PI1542 00 01/05/2017 051-5001-922.50-42 PO NUM 043970 .95- 21708 PI1543 00 01/05/2017 051-5001-922.50-42 PO NUM 043970 3.79 21776 PI1635 00 01/05/2017 051-5001-940.50-35 PO NUM 043970 141.05 21539 PI1538 00 01/05/2017 051-5105-502.50-35 PO NUM 043970 93.25 21637 PI1633 00 01/05/2017 051-5105-502.50-35 PO NUM 043970 85.56 21709 PI1634 00 01/05/2017 051-5105-502.50-35 PO NUM 043970 156.35 21481 PI1536 00 01/05/2017 051-5205-580.50-35 PO NUM 043970 38.39 21558 PI1539 00 01/05/2017 053-6105-502.50-35 PO NUM 043970 106.84 21683 PI1541 00 01/05/2017 053-6105-502.50-35 PO NUM 043970 23.40 VENDOR TOTAL * 837.97 0002069 00 MIDWEST OUTDOOR POWER LLC 31704 PI1580 00 01/05/2017 051-5205-580.50-35 PO NUM 044719 79.66 31704 PI1581 00 01/05/2017 051-5205-580.60-61 PO NUM 044719 96.30 VENDOR TOTAL * 175.96 0004883 00 MISSISSIPPI LIME COMPANY 1294399 00 01/05/2017 051-0000-158.02-00 12/16/16 25.37 TN EFT: 4,336.12 1295404 00 01/05/2017 051-0000-158.02-00 12/22/16 24.64 TN EFT: 4,211.47 VENDOR TOTAL * .00 8,547.59 0002646 00 MONITORING SOLUTIONS INC 23945 PI1529 00 01/05/2017 051-0000-153.00-00 PO NUM 044723 300.21 VENDOR TOTAL * 300.21 0001486 00 MOTION INDUSTRIES INC NE01-457662 PI1660 00 01/05/2017 051-0000-153.00-00 PO NUM 044754 18.51 NE01-457994 PI1661 00 01/05/2017 051-0000-153.00-00 PO NUM 044754 39.07 NE01-457286 PI1577 00 01/05/2017 051-5105-502.50-35 PO NUM 044701 289.96 NE01-457286 PI1578 00 01/05/2017 051-5105-502.60-79 PO NUM 044701 23.01 Page 16 Agenda Item #3 [PAGE 17] PREPARED 12/29/2016,11:20:19 EXPENDITURE APPROVAL LIST PAGE 8 PROGRAM: GM339L AS OF: 01/05/2017 PAYMENT DATE: 01/05/2017 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 0001486 00 MOTION INDUSTRIES INC NE01-457662 PI1687 00 01/05/2017 051-5105-502.60-79 PO NUM 044754 9.42 NE01-457354 PI1556 00 01/05/2017 055-7105-512.50-35 PO NUM 044413 1,237.96 VENDOR TOTAL * 1,617.93 0002985 00 MSC INDUSTRIAL SUPPLY CO INC 47806196 PI1528 00 01/05/2017 051-0000-154.00-00 PO NUM 044704 EFT: 343.28 50924100 PI1662 00 01/05/2017 051-0000-154.00-00 PO NUM 044779 EFT: 338.03 VENDOR TOTAL * .00 681.31 0001958 00 NEBR PUBLIC HEALTH ENVIRONMENTAL 483488 PI1559 00 01/05/2017 053-6105-502.60-61 PO NUM 044530 EFT: 15.00 483489 PI1560 00 01/05/2017 053-6105-502.60-61 PO NUM 044530 EFT: 601.00 VENDOR TOTAL * .00 616.00 0003428 00 NEW PIG CORPORATION 22093434-00 PI1656 00 01/05/2017 051-5001-940.50-35 PO NUM 044749 295.00 22093434-00 PI1657 00 01/05/2017 051-5001-940.60-79 PO NUM 044749 14.99 VENDOR TOTAL * 309.99 0001020 00 O'REILLY AUTOMOTIVE INC 0397-423531 PI1638 00 01/05/2017 051-5001-940.50-35 PO NUM 043973 66.05 0397-423801 PI1639 00 01/05/2017 051-5001-940.50-48 PO NUM 043973 12.81 0397-417612 PI1636 00 01/05/2017 051-5105-502.50-48 PO NUM 043973 76.65- 0397-424252 PI1640 00 01/05/2017 051-5105-502.50-35 PO NUM 043973 74.47 0397-423803 PI1658 00 01/05/2017 051-5105-502.50-48 PO NUM 044760 465.16 0397-417614 PI1637 00 01/05/2017 055-7105-502.50-48 PO NUM 043973 71.64 VENDOR TOTAL * 613.48 0002888 00 OFFICENET 856347-0 PI1566 00 01/05/2017 051-5001-940.50-40 PO NUM 044669 215.54 857575-0 PI1650 00 01/05/2017 051-5205-580.50-40 PO NUM 044689 96.82 857193-0 PI1651 00 01/05/2017 051-5205-580.50-40 PO NUM 044702 190.88 VENDOR TOTAL * 503.24 0002971 00 OMAHA DOOR & WINDOW CO INC ORD0037274 PI1561 00 01/05/2017 051-5001-940.50-35 PO NUM 044573 320.57 ORD0037274 PI1562 00 01/05/2017 051-5001-940.60-79 PO NUM 044573 26.78 VENDOR TOTAL * 347.35 0001912 00 OMAHA PUBLIC POWER DISTRICT CSB000537 PI1530 00 01/05/2017 051-5305-560.60-61 PO NUM 040993 EFT: 83,583.13 CSB000540 PI1531 00 01/05/2017 051-5305-560.60-61 PO NUM 040993 EFT: 3,620,348.50 VENDOR TOTAL * .00 3,703,931.63 0002946 00 OMAHA PUBLIC POWER DISTRICT 1115740525 1216 00 01/05/2017 051-5305-560.60-76 Dec 2016 Interconnection EFT: 4,285.88 VENDOR TOTAL * .00 4,285.88 0001268 00 P & H ELECTRIC INC Page 17 Agenda Item #3 [PAGE 18] PREPARED 12/29/2016,11:20:19 EXPENDITURE APPROVAL LIST PAGE 9 PROGRAM: GM339L AS OF: 01/05/2017 PAYMENT DATE: 01/05/2017 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 0001268 00 P & H ELECTRIC INC 116149 PI1641 00 01/05/2017 055-7105-512.50-35 PO NUM 043974 29.75 VENDOR TOTAL * 29.75 0004948 00 PCM SALES INC S99833900101 PI1568 00 01/05/2017 051-5105-502.50-42 PO NUM 044674 30.09 S99833900101 PI1569 00 01/05/2017 051-5105-502.60-79 PO NUM 044674 16.05 VENDOR TOTAL * 46.14 0003827 00 PEST PRO'S INC MNCP BLD 122016PI1673 00 01/05/2017 051-5001-932.60-61 PO NUM 044194 42.80 ASH PD 122016 PI1674 00 01/05/2017 051-5105-502.60-61 PO NUM 044208 48.15 CMBT TUR 122016PI1675 00 01/05/2017 051-5105-502.60-61 PO NUM 044208 53.50 PWR PLT 122216 PI1676 00 01/05/2017 051-5105-502.60-61 PO NUM 044208 85.60 SUB STA 122016 PI1677 00 01/05/2017 051-5205-580.60-61 PO NUM 044218 190.35 WTR PLT 122016 PI1671 00 01/05/2017 053-6105-502.60-61 PO NUM 044137 69.55 WWTP 122216 PI1672 00 01/05/2017 055-7105-502.60-61 PO NUM 044189 110.00 VENDOR TOTAL * 599.95 0004800 00 PINNACLE BANK - VISA AQ0FE0915570 PI1689 00 01/05/2017 051-5105-502.60-67 PO NUM 044793 150.00 VENDOR TOTAL * 150.00 0002622 00 PITNEY BOWES INC 1002711980 PI1670 00 01/05/2017 051-5001-903.60-65 PO NUM 044127 150.00 VENDOR TOTAL * 150.00 0002793 00 PLIBRICO COMPANY LLC 96365 PI1579 00 01/05/2017 051-5001-932.60-61 PO NUM 044711 4,463.75 VENDOR TOTAL * 4,463.75 0004968 00 POWER SCREENING LLC H612018432 PI1663 00 01/05/2017 055-7001-950.80-50 PO NUM 043773 402,750.00 VENDOR TOTAL * 402,750.00 0003762 00 PR DIAMOND PRODUCTS INC 0043678-IN PI1582 00 01/05/2017 053-6205-583.50-35 PO NUM 044726 474.00 0043678-IN PI1583 00 01/05/2017 053-6205-583.60-79 PO NUM 044726 18.00 VENDOR TOTAL * 492.00 0004740 00 PREMIER STAFFING INC 8917 PI1546 00 01/05/2017 051-5001-940.60-61 PO NUM 043988 30.00 VENDOR TOTAL * 30.00 0004696 00 PRIME COMMUNICATIONS INC 40447 PI1554 00 01/05/2017 051-5001-922.50-42 PO NUM 044348 5,236.23 VENDOR TOTAL * 5,236.23 0004413 00 RADWELL INTERNATIONAL INC INV2678693 PI1680 00 01/05/2017 055-7105-512.50-35 PO NUM 044490 1,852.00 Page 18 Agenda Item #3 [PAGE 19] PREPARED 12/29/2016,11:20:19 EXPENDITURE APPROVAL LIST PAGE 10 PROGRAM: GM339L AS OF: 01/05/2017 PAYMENT DATE: 01/05/2017 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 0004413 00 RADWELL INTERNATIONAL INC INV2680265 PI1681 00 01/05/2017 055-7105-512.60-61 PO NUM 044490 1,733.00 VENDOR TOTAL * 3,585.00 0002876 00 RAWHIDE CHEMOIL INC 57775 PI1570 00 01/05/2017 051-5001-940.50-35 PO NUM 044680 41.73 16441 PI1587 00 01/05/2017 051-5001-917.50-30 PO NUM 044737 16,763.64 57793 PI1683 00 01/05/2017 051-5001-940.50-35 PO NUM 044680 13.91 56376 PI1688 00 01/05/2017 055-7105-502.50-30 PO NUM 044767 633.15 VENDOR TOTAL * 17,452.43 0001514 00 SAFWAY SERVICES LLC D058567/CO58655PI1682 00 01/05/2017 055-7105-512.60-61 PO NUM 044653 EFT: 748.00 VENDOR TOTAL * .00 748.00 0001308 00 SHERWIN-WILLIAMS CO 1392-4 PI1544 00 01/05/2017 053-6105-502.50-35 PO NUM 043978 58.09 VENDOR TOTAL * 58.09 0000429 00 SKARSHAUG TESTING LABORATORY INC 214099 PI1547 00 01/05/2017 051-5205-580.60-61 PO NUM 043994 432.95 214099 PI1548 00 01/05/2017 051-5205-580.60-79 PO NUM 043994 146.22 VENDOR TOTAL * 579.17 0003415 00 SNAP-ON INDUSTRIAL ARV/31101631 PI1686 00 01/05/2017 051-5001-940.50-35 PO NUM 044748 220.21 VENDOR TOTAL * 220.21 0002023 00 SOLUTIONONE 462621 PI1553 00 01/05/2017 051-5001-903.60-65 PO NUM 044126 158.98 462979 PI1669 00 01/05/2017 051-5001-903.60-65 PO NUM 044126 49.22 VENDOR TOTAL * 208.20 0003960 00 SPX TRANSFORMER SOLUTIONS INC 041656 PI1567 00 01/05/2017 051-5205-580.50-35 PO NUM 044671 608.21 VENDOR TOTAL * 608.21 0003923 00 STATE OF NEBRASKA - CELLULAR 1042367 00 01/05/2017 051-5001-903.50-53 Cellular EFT: 104.58 1042367 00 01/05/2017 051-5001-926.50-53 Safety Mgr Cellular EFT: 57.59 1042367 00 01/05/2017 051-5105-502.50-53 Cellular EFT: 137.64 1042367 00 01/05/2017 051-5205-580.50-53 Engineers Cellular EFT: 230.36 1042367 00 01/05/2017 051-5205-580.50-53 Elect Distr Cellular EFT: 359.51 1042367 00 01/05/2017 053-6105-502.50-53 Cellular EFT: 57.59 1042367 00 01/05/2017 053-6205-583.50-53 Cellular EFT: 164.57 1042367 00 01/05/2017 055-7105-502.50-53 Cellular EFT: 23.22 1042367 00 01/05/2017 057-8205-870.50-53 Cellular EFT: 188.82 VENDOR TOTAL * .00 1,323.88 0001137 00 STEFFY CHRYSLER CENTER INC, GENE Page 19 Agenda Item #3 [PAGE 20] PREPARED 12/29/2016,11:20:19 EXPENDITURE APPROVAL LIST PAGE 11 PROGRAM: GM339L AS OF: 01/05/2017 PAYMENT DATE: 01/05/2017 DEPARTMENT OF UTILITIES ------------------------------------------------------------------------------------------------------------------------------------ VEND NO SEQ# VENDOR NAME EFT, EPAY OR INVOICE VOUCHER P.O. BNK CHECK/DUE ACCOUNT ITEM CHECK HAND-ISSUED NO NO NO DATE NO DESCRIPTION AMOUNT AMOUNT ------------------------------------------------------------------------------------------------------------------------------------ 0001137 00 STEFFY CHRYSLER CENTER INC, GENE 5053740 PI1622 00 01/05/2017 051-5105-502.50-48 PO NUM 044759 358.45 VENDOR TOTAL * 358.45 0003891 00 SUNGARD PUBLIC SECTOR INC 128242 PI1678 00 01/05/2017 051-5001-903.60-77 PO NUM 044387 EFT: 233.13 128242 PI1679 00 01/05/2017 051-5001-917.60-77 PO# 044387 EFT: 12.27 VENDOR TOTAL * .00 245.40 0004647 00 T SQUARE SUPPLY LLC 15215 PI1665 00 01/05/2017 051-5001-940.50-35 PO NUM 043980 183.87 15283 PI1667 00 01/05/2017 051-5001-940.50-35 PO NUM 043980 114.07 15269 PI1666 00 01/05/2017 055-7105-512.50-35 PO NUM 043980 22.00 VENDOR TOTAL * 319.94 0001339 00 TIMME WELDING & SUPPLY LLC 32720 PI1668 00 01/05/2017 053-6205-583.50-35 PO NUM 043981 62.60 VENDOR TOTAL * 62.60 0004754 00 TOTAL TOOL SUPPLY INC 08556166 PI1532 00 01/05/2017 051-5105-502.60-61 PO NUM 043508 222.42 VENDOR TOTAL * 222.42 0004515 00 TRACTOR SUPPLY CREDIT PLAN 191520 PI1545 00 01/05/2017 051-5105-502.50-35 PO NUM 043982 56.67 191347 PI1685 00 01/05/2017 057-8205-870.50-48 PO NUM 044693 353.09 VENDOR TOTAL * 409.76 0002413 00 USI EDUCATION & GOVERNMENT SALES 0381746901010 PI1684 00 01/05/2017 051-5205-580.50-40 PO NUM 044683 EFT: 70.10 VENDOR TOTAL * .00 70.10 0002568 00 WATER ENVIRONMENT FEDERATION 9000414616 PI1571 00 01/05/2017 055-7105-502.60-67 PO NUM 044681 79.00 2017 S SEELHOFFPI1572 00 01/05/2017 055-7105-502.60-67 PO NUM 044681 79.00 VENDOR TOTAL * 158.00 0000482 00 WESCO RECEIVABLES CORP 784895 PI1526 00 01/05/2017 051-0000-154.00-00 PO NUM 044503 EFT: 353.10 796697 PI1659 00 01/05/2017 051-0000-154.00-00 PO NUM 044747 EFT: 192.60 VENDOR TOTAL * .00 545.70 0004135 00 WINDOW PRO INC 30469 PI1552 00 01/05/2017 051-5001-932.60-61 PO NUM 044095 EFT: 10.70 VENDOR TOTAL * .00 10.70 EFT/EPAY TOTAL *** 3,763,658.94 TOTAL EXPENDITURES **** 564,763.64 3,763,658.94 GRAND TOTAL ******************** 4,328,422.58 Page 20 Agenda Item #3 [PAGE 21] STAFF REPORT TO: Board of Public Works FROM: Brian Newton, General Manager DATE: January 4, 2017 SUBJECT: Open Season Bid for Northern Natural Gas Storage R ecommendation: Authorize the General Manager to submit an open season bid with N orthern Natural Gas (NNG) for 72,000 MMBtu of additional storage at the NNG tariff r ate. Background: Northern Natural Gas (NNG) is soliciting binding bids for 6.1 Bcf of Firm Deferred Delivery (FDD) service (storage). The last time NNG held an open season for FDD storage was 2004, when FDU acquired 100,000 MMBtu. Currently FDU has 302,510 MMBtu of FDD storage with NNG, which represents approximately 13% of annual sales. With the possibly of the Costco poultry plant coming on line in 2018, submitting a bid for additional FDD storage would be a practical business decision. Also, should the additional FDD storage not be needed in the future, it can be returned to NNG without penalty. Fiscal Impact: Approximately $53,000 per year. Page 21 Agenda Item #4 [PAGE 22] From: Rosman, Stacy Subject: Northern Natural Gas - Firm Deferred Delivery Service Open Season for Service Beginning June 1, 2017 Date: Tuesday, December 06, 2016 4:51:46 PM Attachments: image002.png NNG_Email_Logo.bmp Hello! I wanted to make sure you all saw the Firm Deferred Delivery Service (FDD Storage) open season that was posted earlier today, so I’ve forwarded along a copy of the posting below… Please feel free to contact me if you have any interest in purchasing additional storage and we can talk through the bid process. Have a good evening! Stacy Stacy L Rosman Account Director - Marketing Email: stacy.rosman@nngco.com | O: 402-398-7377 | C: 402-578-2525 | AIM: stacylrosman From: notices@nngco.com [mailto:notices@nngco.com] Sent: Tuesday, December 06, 2016 10:44 AM Subject: Non-Critical, TSP Capacity Offering, 20161206, Northern, 784158214 TSP Name: Northern Natural Gas Company Post Date/Time: 12/06/2016 10:44 AM TSP: 784158214 Notice Effective Date/Time: 12/06/2016 10:44 Notice ID: 034607 AM Notice Type: TSP Capacity Offering Notice End Date/Time: 01/13/2017 5:00 PM Subject: FIRM DEFERRED DELIVERY SERVICE For Gas Day(s): 12/6/2016 - 1/13/2017 OPEN SEASON FOR SERVICE BEGINNING JUNE 1, Notice Status: Initiate 2017 Required Response Indicator Description: 5- Critical: N No response required Notice Text: Northern Natural Gas Company is hereby soliciting binding bids for a total of 6.1 Bcf of Firm Deferred Delivery (FDD) service. This includes 5.8 Bcf of newly available capacity plus 0.3 Bcf of generally available capacity. Northern has identified that it can convert 5.8 Bcf of existing interruptible capacity to FDD. An increase in peak deliverability has been determined to be available at both the Redfield, Iowa and Cunningham, Kansas storage fields that will provide the maximum withdrawal rate to accommodate this conversion of service without significant facility requirements. Firm service made available pursuant to this Open Season is anticipated to be available for injections commencing on June 1, 2017, subject to FERC approval[1] FERC approval is anticipated prior to June 1, 2017, however, if FERC approval is received after June Page 22 Agenda Item #4 [PAGE 23] 1, 2017, but prior to August 1, 2017, service will begin upon receipt of FERC approval and shippers will pay all reservation and capacity fees as if the FDD service began June 1, 2017.[2] If FERC approval is received after August 1, 2017, the service will begin June 1 of the following year. Parameters for the firm service will be as described in Northern’s FERC Gas Tariff (Tariff) under the FDD Rate Schedule. Up to 0.3 Bcf of generally available capacity will be awarded without regard to the FERC approval of the proposed 5.8 Bcf of converted interruptible capacity to firm capacity. Open Season The open season commences Tuesday, December 6, 2016, and ends Friday, January 13, 2017, at 5:00 p.m. CCT. For a bid to be considered, it must be received by 5:00 p.m. CCT January 13, 2017. If you have any questions, please contact your account manager or Dave Stockdale at (402) 398-7643. Bid Procedures 1. Submit your binding bid to Northern either via facsimile to (402) 398-7413 or e-mail to NNGOpenSea@nngco.com. The bid must contain a completed Open Season Bid Form or all the information required by such form. After submission, upon a determination by Northern that the bid is a best bid, the bid becomes a binding contract. If bidder is awarded capacity, bidder shall execute a service agreement upon tender by Northern. All bids must include the firm storage quantity (FSQ) bid, the minimum acceptable FSQ the bidder will accept and the term in years. 2. Bid quantities will only be accepted for service terms commencing on June 1, 2017, that are in full annual increments (June 1 through May 31). 3. Alternative Bid Methodology - The capacity will be awarded to the highest bidder(s) based on a determination of the best bid, or combination of bids that result in the highest net present value (NPV) of reservation revenue, on a per unit of capacity basis. Northern shall have the right to aggregate bids, or portions of bids, that generate the highest NPV to Northern. The NPV per unit will be determined by discounting the cash flow (using the FERC interest rate) generated from an annualized unit rate, based on the firm deferred delivery reservation fee and capacity fee, over the term bid and dividing by the FSQ requested. The annualized unit reservation rate equates to $0.7134 per Dth. 4. Northern will only be accepting maximum tariff rate bids. For purposes of bid evaluation, any bids exceeding twenty years will be economically evaluated as a bid for twenty years. 5. Northern agrees to a rollover charge per Dth equal to $0.00 for any quantity less than or equal to 5% of the contract FSQ on May 31 of each year for the term of the bid. 6. Northern and bidder(s) may agree to amend the service agreement, as allowed by Northern’s FERC Gas Tariff, at any time after award of the capacity. 7. Northern will evaluate bids and award the capacity based on the terms of this open season. 8. Customer(s) must meet the creditworthiness provisions of Northern’s Tariff. Upon request by Northern, customer shall provide appropriate credit assurance within ten (10) calendar days of Northern’s request. If a non-creditworthy customer fails to provide the appropriate security, Northern may award the capacity to the next best bid(s) or proceed to remarket the capacity, and customer will be liable for any difference in value of the bids, in addition to any other remedies available by law. 9. The results will be posted on Northern’s website and notification will be made to the winning bidder(s). 10. Northern may consider contingent bids. [1] Changes to Northern’s FERC Gas Tariff that increase the amount of FDD service that can be sold must be approved by the FERC. [2] In the event the effective date of the FDD service is after June 1, 2017 but before August 1, 2017, the transportation service agreement will be filed as a non-conforming, negotiated rate service agreement. Non-Critical notices are located on Northern's website at the following address - http://www.northernnaturalgas.com/InfoPostings/Notices/Pages/NonCritical.aspx Page 23 Agenda Item #4 [PAGE 24] City of Fremont - Firm Storage Contract Information 10/11/16 ROFR Min Bal Max Bal Max Bal FDD Rate Rate Rate Contract Initial Current Max Bal on Rate Contract# End Date or FSQ on on on O ption Reservation Reservation Reservation POI Point Description Type Start DateStart Date Aug 31st Commodity Rollover Jan 31st Mar 1st May 31st Type Average Winter Summer 98 OGDEN DEF. DELIVERY Max WD FDQ Max INJ FDQ INJ Period Max Bal - 8/31 FDD 22309 06/01/93 06/01/11 05/31/19 Rollover 202,510 134,669 81,004 50,628 10,126 4 Step Max Max Max Max WD Period Min Bal - 1/31 WD Period Max Bal - 3/1 Max Rollover Bal - 5/31 98 OGDEN DEF. DELIVERY Max WD FDQ Max INJ FDQ INJ Period Max Bal - 8/31 FDD 111012 06/01/04 06/01/11 05/31/21 ROFR 100,000 66,500 40,000 25,000 5,000 4 Step Max Max Max Max WD Period Min Bal - 1/31 WD Period Max Bal - 3/1 Max Rollover Bal - 5/31 Page 24 Agenda Item #4 [PAGE 25] Natural Gas Actual Usage - Monthly City of Fremont Dept. of Utilities Date Range : 12/01/2011 - 11/30/2016 (All Volumes in MMBtu) Month Actual MIN MAX AVG CO2e (MMBtu) (MMBtu) (MMBtu) Usage (Metric tons) Dec - 11 285,246 6,771 12,804 9,201 15,532 Jan - 12 297,376 6,437 14,539 9,593 16,193 Feb - 12 271,886 7,059 13,503 9,375 14,805 Mar - 12 163,728 3,132 8,718 5,282 8,915 Apr - 12 135,602 3,180 5,957 4,520 7,384 May - 12 124,726 2,677 4,890 4,023 6,792 Jun - 12 124,333 2,576 8,289 4,144 6,770 Jul - 12 140,712 3,027 8,238 4,539 7,662 Aug - 12 121,327 2,599 4,529 3,914 6,606 Sep - 12 116,862 2,624 4,909 3,895 6,363 Oct - 12 172,862 3,372 8,590 5,576 9,413 Nov - 12 217,735 4,632 11,122 7,258 11,856 Dec - 12 306,320 5,492 13,835 9,881 16,680 Jan - 13 341,719 7,597 15,583 11,023 18,607 Feb - 13 284,656 7,064 13,533 10,166 15,500 Mar - 13 265,836 3,235 11,763 8,575 14,475 Apr - 13 187,618 2,489 9,718 6,254 10,216 May - 13 133,403 1,746 8,514 4,303 7,264 Jun - 13 100,387 1,859 4,235 3,346 5,466 Jul - 13 105,706 1,985 4,172 3,410 5,756 Aug - 13 102,045 1,810 4,244 3,292 5,557 Sep - 13 91,562 1,479 3,973 3,052 4,986 Oct - 13 162,554 3,178 7,711 5,244 8,851 Nov - 13 245,514 4,860 11,982 8,184 13,369 Dec - 13 366,153 6,905 15,501 11,811 19,938 Jan - 14 372,054 6,998 15,887 12,002 20,259 Feb - 14 326,040 8,154 15,674 11,644 17,754 kgarst Page 25 Agenda Item #4Page 1 of 2 12/5/2016 2:44:54 PM [PAGE 26] Natural Gas Actual Usage - Monthly City of Fremont Dept. of Utilities Date Range : 12/01/2011 - 11/30/2016 (All Volumes in MMBtu) Month Actual MIN MAX AVG CO2e (MMBtu) (MMBtu) (MMBtu) Usage (Metric tons) Mar - 14 255,399 3,787 13,065 8,239 13,907 Apr - 14 164,496 2,697 9,232 5,483 8,957 May - 14 111,919 1,761 6,366 3,610 6,094 Jun - 14 95,166 1,852 4,070 3,172 5,182 Jul - 14 99,806 2,231 3,960 3,220 5,435 Aug - 14 101,680 2,244 4,154 3,280 5,537 Sep - 14 88,539 1,644 3,981 2,951 4,821 Oct - 14 138,320 2,248 7,321 4,462 7,532 Nov - 14 265,968 4,118 13,598 8,866 14,482 Dec - 14 300,639 4,892 16,453 9,698 16,370 Jan - 15 328,808 7,156 16,147 10,607 17,904 Feb - 15 326,230 6,227 15,482 11,651 17,764 Mar - 15 217,956 3,882 12,934 7,031 11,868 Apr - 15 149,211 3,054 8,168 4,974 8,125 May - 15 124,205 2,632 5,928 4,007 6,763 Jun - 15 103,997 2,831 4,279 3,467 5,663 Jul - 15 121,026 2,388 7,452 3,904 6,590 Aug - 15 118,904 1,917 12,225 3,836 6,475 Sep - 15 173,796 2,920 13,327 5,793 9,464 Oct - 15 146,578 2,849 8,548 4,728 7,981 Nov - 15 213,292 3,755 11,462 7,110 11,614 Dec - 15 286,129 6,250 13,247 9,230 15,580 Jan - 16 348,347 7,096 15,256 11,237 18,968 Feb - 16 270,935 4,540 12,517 9,343 14,753 Mar - 16 203,618 3,827 11,572 6,568 11,087 Apr - 16 157,475 2,984 7,818 5,249 8,575 May - 16 125,573 2,404 5,330 4,051 6,838 Jun - 16 212,898 2,734 12,361 7,097 11,593 Jul - 16 152,977 2,643 14,676 4,935 8,330 Aug - 16 118,097 1,525 5,062 3,810 6,431 Sep - 16 118,868 2,898 4,740 3,962 6,473 Oct - 16 152,236 2,731 12,657 4,911 8,290 Nov - 16 202,373 4,022 10,069 6,746 11,020 Totals: 11,559,423 1,479 16,453 6,345 629,435 kgarst Page 26 Agenda Item #4Page 2 of 2 12/5/2016 2:44:54 PM [PAGE 27] Input # FDD BILLING EXAMPLE 72,000 MMBTU Cycle Quantity Ref Tariff Sheet Nos. 54 & 55 FDD Season Jun-Oct Nov-May The storage rates shown in the table are the tariff rates starting Reservation Rate 1.714 1.7140 November 1, 2006. Capacity Rate 0.3567 0.3567 Injection/Withdrawal Rate 0.0149 0.0149 Overrun 0.0887 0.0887 Jun-Oct Nov-Apr COMPONENTS RATE RATE BILLING QUANTITY INJECTION PERIOD WITHDRAWAL PERIOD MAXIMUM DAILY MONTHS MONTHS OVERRUN ONLY W/D QUANTITY JUNE JULY AUG. SEPT. OCT. NOV. DEC. JAN. FEB. MARCH APRIL MAY TOTAL RESERVATION FEE * 1 $1.7140 $1.7140 1,249 MMBTU $2,140 $2,140 $2,140 $2,140 $2,140 $2,140 $2,140 $2,140 $2,140 $2,140 $2,140 $2,140 $25,685 ANNUAL CYCLE QUANTITY CAPACITY FEE * 2 $0.3567 $0.3567 72,000 MMBTU $5,136 $5,136 $5,136 $5,136 $5,136 $25,682 INJECTION * 3 SEE ACTUAL Inject. w/in Firm Reqrmts: $0.0149 per MMBTU W/D w/in Firm Reqrmts: $0.0149 per MMBTU $2,146 and INFORMATION QUANTITIES Inject. Overrun $0.0149 plus $0.0887 per MMBTU W/D Overrun $0.0149 plus $0.0887 per MMBTU Increm. Cost (if an WITHDRAWAL FEES AT RIGHT W/D w/in Firm Reqrmts: $0.0887 per MMBTU Inject. w/in Firm Reqrmts: $0.0887 per MMBTU Increm. Cost (if an W/D Overrun $0.0887 per MMBTU Inject. Overrun $0.0887 per MMBTU Increm. Cost (if an FDD STORAGE FUEL ACTUAL see Tariff Sheet No. 54 SUMMER for most current rate INJECTIONS Note * 1: Rate x maximum daily w/d volume, billed monthly over 12 months TOTAL FDD BILLING $53,513 (w/o any increm. cost) Note * 2: Rate x annual cycle volume, billed equally over the injection period, only FDD UNIT COST $0.7432 Note * 3: Rate x actual monthly injection or withdrawal volume equals each monthly bill (w/o any increm. VOL.) PER MMBTU FDU Gas Sales 2014 2015 2016 Costco Jan 3 72,054 328,808 348,347 45,000 Feb 3 26,040 326,230 270,935 45,000 Mar 2 55,399 217,956 203,618 45,000 Apr 1 64,496 149,211 157,475 45,000 May 1 11,919 124,205 125,573 45,000 Jun 9 5,166 103,997 212,898 45,000 Jul 9 9,806 121,026 152,977 45,000 Aug 1 01,680 118,904 118,097 45,000 Sept 8 8,539 173,796 118,868 45,000 Oct 1 38,320 146,578 152,236 45,000 Nov 2 65,968 213,292 202,373 45,000 Dec 3 00,639 286,129 300,000 45,000 Total Year 2,320,026 2,310,132 2,363,397 540,000 Avg sales 2,331,185 Current storage 302510 New sales 2,871,185 2014 2015 2016 New storage needs % of storage to sales 13.04% 13.09% 12.80% 70744 Page 27 Agenda Item #4 [PAGE 28] STAFF REPORT TO: Board of Public Works FROM: Brian Newton, General Manager DATE: January 4, 2017 SUBJECT: Clawback Agreement with Costco R ecommendation: Authorize the General Manager to execute the clawback agreement w ith Costco and recommend approval by the City Council. Background: As part of the Amended and Restated Redevelopment Agreement with Costco the City agreed to provide Costco a $2,000,000 Economic Incentive for the installation and construction of utility infrastructure; subject to certain clawback provisions. Clawback provisions include a 15-year commitment by Costco to not discontinue use of its agricultural and industrial processing facilities and to meet yearly minimum utility consumption requirements. Failure to meet the provisions will require Costco to repay all or a portion of the Economic Incentive. Fiscal Impact: None Page 28 Agenda Item #5 [PAGE 29] CLAWBACK PROVISIONS AND INDEMNIFICATION AGREEMENT This Clawback Provisions and Indemnification Agreement (the “Agreement”) is made and entered into on this ___ day of _______, ________, between the City of Fremont, a municipal political subdivision of the State of Nebraska (“City”), whose address for the purposes of this Agreement is 400 E Military Ave, Fremont NE 68025, and Costco Wholesale Corporation, a Washington corporation (“Costco”), whose address for the purposes of this Agreement is 999 Lake Drive, Issaquah, WA 98027. PRELIMINARY STATEMENT The City has agreed to provide Costco a $2,000,000 incentive (“Economic Development Incentive”) in the Amended and Restated Redevelopment Agreement dated __________, _______ (“Redevelopment Agreement”) in connection with the installation and construction of utility infrastructure (electric, natural gas, water, and wastewater) the general locations as legally described on the attached Exhibit “A” (the “Costco Property”) to be owned by Costco and operated by Lincoln Premium Poultry as an agricultural and industrial processing facility so long as Costco or its lessee and/or operator consumes minimum volumes of utility services depicted in attached Exhibit “B” (the “Minimum Utility Requirements”) during the term of this agreement. Should Costco fail to meet the Minimum Utility Requirements during the term of this agreement, Costco has agreed to reimburse the City’s incentive, subject to the terms and conditions set forth herein. TERMS AND CONDITIONS Now, therefore, in consideration of the foregoing Preliminary Statement which is included herein by this reference and the mutual covenants of the parties hereto, it is agreed as follows: 1. Term: The term of this agreement shall be fifteen (15) years commencing (“Term”) one (1) year following the date of commercial operation. 2. Utility Consumption Reporting: Within ninety (90) days after receipt, Costco shall pay all utility consumption bills, and with such payment, Costco shall provide a summary of its utility consumption, which shall include a reasonable level of detail describing the utility service provided, the actual amount of utility services consumed by Costco, and the disparity between the actual utility services consumed on the Costco Property and the Minimum Utility Requirements. 3. Reimbursement: Costco shall reimburse the City the Economic Development Incentive upon the occurrence of the following events: a. If Costco elects to discontinue its use of the facilities at the Costco Property as contemplated in the Redevelopment Agreement during the Term of this Agreement, within thirty (30) days of such election Costco must: (1) notify the City in writing of such election, and (2) reimburse the Department of Utilities for the Economic Development Incentive in full; or b. If, at the end of the Term, Costco has not met the yearly Minimum Utility Requirements set forth on Exhibit “B”, within thirty (30) days following the expiration of the Term of this Agreement, Costco shall reimburse the Department of Utilities a portion of the two million dollar ($2,000,000.00) Page 29 Agenda Item #5 [PAGE 30] Economic Development Incentive which corresponds to Costco’s average overall deficiency percentage calculated as follows: i. Every year during the Term of the Agreement for each of the four utilities listed on Exhibit “B”, it shall be determined whether Costco met the Minimum Consumption Requirements for that utility outlined in Exhibit “B.” If Costco did not meet the Minimum Consumption Requirements for some or all of the four utilities, the difference between the actual consumption and Minimum Consumption Requirements for each utility that did not meet the Minimum Consumption Requirements shall be used to calculate the percent Costco was deficient in meeting the Minimum Consumption Requirements for that utility as follows: Minimum Consumption Requirement (-) Actual Consumption (X) X = Deficiency % Minimum Consumption Requirement 100 ii. After the deficiency percentage is calculated for each utility as applicable, the deficiency percentage for each such utility shall be averaged by totaling said individual percentages and dividing the total by four (4) to produce an aggregate deficiency percentage for the year. No credit shall be given for consuming more than the Minimum Utility Requirements for any utility. iii. After the aggregate yearly deficiency percentage is calculated for each year during the Term of the Agreement, the yearly deficiency percentage for each year shall be totaled, and the total shall be divided by the number of years in the Term to produce the average aggregate deficiency percentage for the Term, which aggregate percentage shall be multiplied by the amount of the Two Million Dollar Economic Development Incentive, the product of which is the amount which Costco must repay to the City pursuant to this Agreement. 4. Costco hereby agrees to indemnify and hold City harmless from and against any and all liabilities, expenses including reasonable attorneys’ and engineers’ fees, orders, lawsuits, causes of actions, claims, damages, costs, penalties, fines, interest and demands whatsoever suffered, threatened against, or paid, or incurred by City in connection with, or arising from, Costco’s failure to reimburse the City. 5. This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the parties. 6. All notices or other communications required or permitted by this Agreement shall be in writing and in all cases addressed to the party at the location or address indicated above. Such notice shall be considered to be properly given by and received by a party (i) whenever delivered in person, or (ii) on the date a return receipt is signed by a party when sent by certified mail, regardless of when received or delivered. A party shall have the right to change its address for notice or other communication to any other person or location within the continental United States by giving prior written notice to the other party. 2 Page 30 Agenda Item #5 [PAGE 31] 7. This Agreement may be executed in counterparts, each of which will be deemed an original and all of which together will constitute one agreement. Each counterpart may be delivered by facsimile or computer-scanned image transmission. The signature page of any counterpart may be detached therefrom without impairing the legal effect of the signature(s) thereon provided such signature page is attached to any other counterpart identical thereto. 8. No amendment of this Agreement shall be valid unless it is in writing and is signed by the parties or by their duly authorized representatives, and unless it specifies the nature and extent of the amendment. 9. The City and Costco each agree to abide by all federal, state, and local laws, statutes, ordinances and regulations governing the activities discussed herein. Costco shall comply with, and indemnify the City against any violations of applicable regulations promulgated by the Environmental Protection Agency or other government agencies regulating any activities engaged in by Costco. 10. This Agreement, and the rights and duties of the parties arising from or relating in any way to the terms, covenants, or conditions of this Agreement shall be governed by, construed and enforced in accordance with the laws of the State of Nebraska. [Signature Page Follows] 3 Page 31 Agenda Item #5 [PAGE 32] IN WITNESS WHEREOF, this Agreement was executed on the date as first written hereinabove. COSTCO WHOLESALE CORPORATION CITY OF FREMONT, NEBRASKA, a Washington corporation, a municipal political subdivision of the State of Nebraska, By:___________________________ By:___________________________ Scott Getzschman, Mayor Name:________________________ Title:_________________________ ATTEST APPROVED AS TO FORM ____________________________ Tyler Ficken, City Clerk Paul Payne, City Attorney 4 Page 32 Agenda Item #5 [PAGE 33] [Signature Page to Clawback Provisions and Indemnification Agreement] Exhibit “A” (“Costco Property”) A TRACT OF LAND TO BE ANNEXED INTO THE CITY OF FREMONT, LOCATED IN PART OF NORTHEAST AND NORTHWEST QUARTERS OF SECTION 26, TOWNSHIP 17 NORTH, RANGE 8 EAST OF THE 6TH P.M., DODGE COUNTY, NEBRASKA, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF THE SOUTHEAST QUARTER OF SECTION 26, TOWNSHIP 17 NORTH, RANGE 8 EAST, DODGE COUNTY, NEBRASKA, THENCE EASTERLY ON AN ASSUMED BEARING OF N87°43’50”E ON THE NORTH LINE OF THE SOUTHWEST QUARTER OF SECTION 26, 1130.95 FEET TO A POINT ON THE APROXIMATE WESTERLY RAILROAD RIGHT-OF-WAY LINE; THENCE S05°07’33”E ON SAID WESTERLY RAILROAD RIGHT-OF-WAY LINE, 1178.00 FEET TO A POINT INTERSECTING THE NORTHERLY RIGHT-OF-WAY LINE OF HILLS FARM ROAD; THENCE N59°05’58”W ON SAID NORTHERLY RIGHT-OF-WAY LINE; 697.41 FEET; THENCE CONTINUNING N86°26’21”W, ON SAID NORTHERLY RIGHT-OF-WAY LINE, 1931.80 FEET; THENCE N02°10’38”W, 1162.85 FEET TO THE NORTHWEST CORNER OF LOT 6, EAST INGLEWOOD SUBDIVISION, A PLATTED AND RECORDED SUBDIVISION IN DODGE COUNTY; THENCE N87°42’03”E ON THE NORTH LINE OF SAID LOT 6, 545.50 FEET TO THE NORTHEAST CORNER OF SAID LOT 6; THENCE N02°06’54”W ON THE EAST LINE OF LOT 5, SAID EAST INGLEWOOD SUBDIVISION, 283.94 FEET TO A POINT ON THE EAST LINE OF LOT 4, SAID EAST INGLEWOOD SUBDIVISION; THENCE N88°10’00”E, 772.03 FEET TO A POINT ON THE WEST LINE OF THE SOUTHWEST QUARTER OF THE NORTHEAST QUARTER; THENCE S01°58’55”E ON SAID WEST LINE OF THE NORTHEAST QUARTER, 842.47 FEET TO THE POINT OF BEGINNING. SAID TRACT OF LAND CONTAINS A CALCULATED AREA OF 2,839,313.53 SQ. FT. OR 65.18 ACRES MORE OR LESS. AND A TRACT OF LAND TO BE ANNEXED INTO THE CITY OF FREMONT, LOCATED IN PART OF SOUTHEAST QUARTER OF THE NORTHEAST QUARTER, AND PART OF THE EAST HALF OF THE SOUTHWEST QUARTER OF SECTION 26, AND PART OF THE SOUTH HALF OF THE NORTHWEST QUARTER AND PART OF THE SOUTHWEST QUARTER AND PART OF THE WEST HALF OF THE SOUTHEAST QUARTER OF SECTION 25, AND PART OF THE NORTHWEST QUARTER OF THE NORTHEAST QUARTER OF SECTION 36, TOWNSHIP 17 NORTH, RANGE 8 EAST OF THE 6TH P.M., DODGE COUNTY, NEBRASKA, MORE PARTICULARLY DESCRIBED AS FOLLOWS: COMMENCING AT THE SOUTHWEST CORNER OF THE NORTHEAST QUARTER OF THE NORTHEAST QUARTER OF SAID SECTION 26; THENCE NORTHEASTERLY ON THE NORTH LINE OF THE NORTHEAST QUARTER OF THE NORTHEAST QUARTER ON AN ASSUMED BEARING OF N87°52’30”E, 33.00 FEET TO THE POINT OF BEGINNING; THENCE S58°58’04”E, 191.84 FEET TO A POINT ON THE SOUTHERLY RIGHT-OF-WAY LINE OF EAST CLOVERLY ROAD; THENCE N88°05’46”E ON SAID SOUTHERLY RIGHT-OF-WAY LINE OF EAST CLOVERLY ROAD, 1425.78 FEET TO A POINT OF CURVATURE; THENCE ON A 1308.22 FOOT RADIUS CURVE TO THE RIGHT ON SAID SOUTHERLY RIGHT-OF-WAY LINE OF EAST CLOVERLY ROAD, AN ARC LENGTH OF 1030.78 FEET (LONG CHORD BEARS S69°21’38”E, 1004.32 FEET); THENCE S46°47’16”E ON SAID SOUTHERLY RIGHT-OF-WAY LINE OF EAST CLOVERLY ROAD, 1238.40 FEET TO A POINT OF CURVATURE; THENCE ON A 260.00 FOOT RADIUS CURVE TO THE LEFT ON SAID SOUTHERLY RIGHT-OF WAY LINE OF EAST CLOVERLY ROAD, AN ARC LENGTH OF 145.89 FEET (LONG CHORD BEARS S62°49’54”E, 143.98 FEET); THENCE 5 Page 33 Agenda Item #5 [PAGE 34] S43°15’’11”W, 507.62 FEET; THENCE S02°10’141”E, 149.93 FEET; THENCE S87°49’55”E, 729.97 FEET; THENCE N02°07’45”W, 189.94 FEET; THENCE N02°07’45”W, 256.01 FEET TO A POINT ON THE APPROXIMATE SOUTHWESTERLY RAILROAD RIGHT-OF-WAY LINE; THENCE S46°46’20”E ON SAID SOUTHWESTERLY RAILROAD RIGHT-OF-WAY LINE, 1911.83 FEET TO A POINT ON THE EAST LINE OF SAID WEST HALF OF THE SOUTHEAST QUARTER; THENCE S02°14’28”E ON SAID EAST LINE OF THE WEST HALF, 1107.05 FEET TO THE SOUTHEAST CORNER OF THE SOUTHWEST QUARTER OF THE SOUTHEAST QUARTER; THENCE S02°12’31”E ON THE EAST LINE OF SAID NORTHWEST QUARTER OF THE NORTHEAST QUARTER OF SECTION 36, 1356.15 FEET TO A POINT ON THE NORTHERLY RIGHT- OF-WAY LINE OF HILLS FARM ROAD; THENCE N70°35’17”W ON SAID NORTHERLY RIGHT-OF-WAY LINE OF HILLS FARM ROAD, 1410.04 FEET; THENCE N02°14’36”W, 711.27 FEET; THENCE N71°00’17”W, 375.56 FEET TO A POINT ON THE SOUTH LINE OF SAID SOUTHWEST QUARTER OF SECTION 25; THENCE CONTINUING N71°00’17”W, 825.89 FEET; THENCE N70°58’58”W, 290.07 FEET; THENCE N62°51’54”W, 488.40 FEET; THENCE S01°12’50”E, 631.29 FEET TO A POINT ON SAID SOUTH LINE OF THE SOUTHWEST QUARTER; THENCE N58°57’36”W ON THE NORTHERLY RIGHT-OF-WAY LINE OF HILLS FARM ROAD, 984.75 FEET TO A POINT INTERSECTING THE NORTHERLY RIGHT-OF-WAY LINE OF HILLS FARM ROAD AND THE WEST RIGHT-OF WAY LINE OF YAGER ROAD; THENCE N02°09’03”W ON SAID WEST RIGHT-OF-WAY LINE OF YAGER ROAD, 306.92 FEET TO THE NORTHEAST CORNER OF LOT 1R, REPLAT OF BLOCK 1 SOUTH FREMONT; THENCE S87°49’05”W ON THE NORTH LINE OF SAID LOT 1R, 226.99 FEET TO THE NORTHWEST CORNER OF SAID LOT 1R; THENCE S02°11’37”E ON THE WEST LINE OF SAID LOT 1R, 161.11 FEET TO A POINT ON SAID NORTHERLY RIGHT-OF-WAY LINE OF HILLS FARM ROAD; THENCE N59°08’09”W ON SAID NORTHERLY RIGHT-OF-WAY LINE OF HILLS FARM ROAD, 1231.92 FEET TO A POINT INTERSECTING SAID NORTHERLY RIGHT-OF-WAY LINE OF HILLS FARM ROAD AND THE EAST RIGHT-OF-WAY LINE OF SOUTH PLATTE AVENUE; THENCE N02°07’30”W ON SAID EAST RIGHT-OF-WAY LINE OF SOUTH PLATTE AVENUE, 2604.69 FEET TO THE POINT OF BEGINNING. SAID TRACT OF LAND CONTAINS A CALCULATED AREA OF 15,119,539.82 SQ. FT. OR 347.10 ACRES MORE OR LESS. 6 Page 34 Agenda Item #5 [PAGE 35] Exhibit “B” (“Minimum Utility Requirements”) Minimum Yearly Requirements: Utility: Electric 10.15 MW 62,380,800 kWh Water 597,600,000 Gal Wastewater 584,400,000 Gal Natural gas 897,600 Dkt Exhibit “B” Page 35 Agenda Item #5 [PAGE 36] WWTP ANNUAL REPORT 2015/2016 Agenda Item #7a [PAGE 37]  WWTP 10 Employees  Superintendent  Lab Technician  5 Operators  3 Mechanics Agenda Item #7a [PAGE 38] Annual Budget 2015/2016 Account Budget Actual % Wages 562000 531066 94.5 Benefits 290955 284031 97.6 Commodities 404000 425291 105.3 Contractual Services 438070 435184 99.4 Depreciation 819400 805774 98 Capital Projects 435000 338536 77.8 Total 2,560,900 2,502,819.04 97.70 Agenda Item #7a [PAGE 39] CAPITAL EXPENDITURES  Budget Actual  Roof Replacement 75,000.00 88,895.00  Headwork's Heating System 110,000.00 98,450.00  Dissolved Oxygen TSS meters 50,000.00 24,900.00  Tractor 50,000.00 43,459.00  Compost Screen 175,000.00 82,832.00 145,168.00 Grant (228,000)  Total 460,000.00 338,536.00 Agenda Item #7a [PAGE 40] WASTEWATER TREATED  1,661,112,000 Gallons/yr.  137,630,000 Gallons/month  4,614,200 Gallons/day  1.507 Cost/1000 gallons (1.021/1000 gallons) Agenda Item #7a [PAGE 41] BIOSOLIDS PROGRAM  Biosolids Hauled/spread – 4730 tons  Spread on 450 acres  Hauling $31,984.00  Spreading $22,920.00  Scale $1348.00  Total Expenses $56,252.00  Biosolids Income $48,735.00  Net cost $7517.00 Agenda Item #7a [PAGE 42] WWTP UPGRADE  HDR – Design and Specifications  30-35 Million estimated cost  25% complete  Plans and Specs to DEQ (May 31, 2017)  June/August 2017 bid????  Completion by November 2019 Agenda Item #7a [PAGE 43] Nebraska Public Power’s Competitiveness in the Regional Energy Market Produced for Wind is Water Foundation December 12, 2016 Goss & Associates Economic Solutions www.gossandassociates.com The Goss Institute Ernest Goss, Principal Investigator 600 17th Street, Suite 2800 South Denver, Colorado 80202-5428 303.226.5882 Ernest Goss, Ph.D. ernieg@creighton.edu Jeffrey Milewski, M.S. jmilewski@gossandassociates.com Page 43 Agenda Item #7b [PAGE 44] Table of Contents Nebraska Public Power’s Competitiveness In the Regional Energy Market Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .i Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 Section 1: The Southwest Power Pool’s Integrated Marketplace Challenges Nebraska’s Public .......... Power Model . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 2: Threats facing Nebraska’s Public Power Generation. . . . . . . . . . . . . . . . . . . . . . . . . . 10 Section 3: A Case for Retail Choice in Nebraska - The effect on electric rates, reducing ratepayer ..........risk, and the need for greater transparency using unbundled billing . . . . . . . . . . . . . . 15 Appendix A: SPP Market Participants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Appendix B: Illustration of Southwest Power Pool Integrated Market. . . . . . . . . . . . . . . . . . . . . . . 24 Appendix C: Example of an Unbundled Bill. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Appendix D: Screenshot of powertochoose.org Showing Suppliers’ Rate Options. . . . . . . . . . . . 26 Appendix E: 2015 Utility Bundled Retail Sales - Residential . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Appendix F: 2015 Utility Bundled Retail Sales - Industrial. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Appendix G: Researchers’ Biographies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 NEBRASKA PUPBLICa POgWERe’S C O4MP4ETITIVENESS IN THE REGIONAL ENERGY MARKET Agenda Item #7b [PAGE 45] Preface Nebraska Public Power’s Competitiveness In the Regional Energy Market The subsequent analysis was prepared Goals of the study for Wind is Water by Ernest Goss, Ph.D., Principal The goal of this study was to examine how Investigator, and Jeff Milewski of Goss & Nebraska’s power industry operates within the Associates Economic Solutions. Findings remain Southwest Power Pool, particularly the integrated the sole property of Wind is Water Foundation marketplace, and to determine whether Nebraska’s and may not be used without prior approval of Public Power Model is adequately serving the this organization. Any errors or misstatements ratepayer. contained in this study are solely the responsibility of the authors.1 The authors’ biographies are Specific goals of the study are to: provided in Appendix G. Please address all • Determine whether increased competition and correspondence to: choice in Nebraska’s power industry leads to cheaper sources of electricity and better rates for consumers. o If so, explore how increasing competition and choice affect Nebraska’s generating utilities, consumer-utilities, and ratepayers. • Examine how federal tax credits for renewables and environmental regulations, particularly the new Clean Power Plan, would affect Nebraska’s public power utilities. • Investigate how Nebraska’s public power structure restricts choice. What disincentivizes private capital from investing in Nebraska’s electricity sector? • Determine whether legislative changes would help increase transparency and promote greater choice in the electric industry in Nebraska. Goss & Associates thanks Wind is Water Foundation for their assistance in providing data for this study. However, any errors, omissions, or misstatements are solely the responsibility of Goss & Associates and the principal investigator. 1This study was completed independent of Creighton University. As such, Creighton University bears no responsibility for findings or statements by Ernie Goss, or Goss & Associates, Economic Solutions. Page 45 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page i [PAGE 46] Executive Summary Nebraska Public Power’s Competitiveness In the Regional Energy Market • Since the implementation of the SPP Integrated Market (IM) in March 2014, electricity prices have trended downward due to the addition of wind generation and low natural gas prices. Because of the high cost of production at some plants in Nebraska, ratepayers have not fully benefited from the more than $1 billion saved by lower electricity prices from the SPP IM. Until Nebraska’s generation costs are reduced, ratepayers will not benefit from the lower prices in the SPP IM. • The cost effectiveness of Nebraska’s public power generation is currently at risk in the SPP IM. There are two main reasons for this: (1) low natural gas prices; and (2) additional wind generation in the SPP footprint. • The financial risk to ratepayers in owning generation is increasing, as seen with the decommissioning of the Fort Calhoun nuclear plant. Divesting from generating assets and embracing retail choice could reduce ratepayers’ risk by eliminating the potential future costs of stranded assets. • A more competitive energy landscape would allow consumers to choose among public and private power providers in the state. This arrangement is commonly referred to as “retail choice.” In a competitive, retail choice environment, Nebraska public power could pursue a strategy to divest from owning generating assets, and instead, focus solely on the management and operation of transmission and distribution systems. This would incentivize competition to produce from the cheapest sources of generation and substantially reduce the ratepayer risk and uncertainly of owning generation in a changing energy market. Page 46 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 1 [PAGE 47] Section 1 - The Southwest Power Pool’s Integrated Marketplace Challenges Nebraska’s Public Power Model Introduction The SPP footprint recently expanded in The Southwest Power Pool (SPP) is a October 2015 to include much of North Dakota regional transmission organization (RTO) based and South Dakota, and parts of Montana.2 This in Little Rock, Arkansas with approximately 600 expansion added 5,000 megawatts of demand and employees. It covers all or parts of fourteen states: 9,500 miles of transmission lines. The expansion Arkansas, Iowa, Kansas, Louisiana, Minnesota, added more wind production to the SPP footprint Missouri, Montana, Nebraska, New Mexico, North and integrated market. Dakota, Oklahoma, South Dakota, Texas and In 2014, the SPP established a pooled Wyoming. marketplace, referred to as the Integrated Market Figure 1.1 shows the SPP footprint. As (IM), for buying and selling electricity to its Market of June 2016, the SPP had 94 members and 175 Participants (MP). Market Participants in the IM are market participants (See Appendix A). Several members of the SPP, which consists of private and Nebraska Public Power utilities own transmission, public utilities, independent power generators, and including the Nebraska Public Power District (NPPD) retail providers. The purpose of the IM is to optimize and the Omaha Public Power District (OPPD). NPPD generation to meet the demand for the SPP footprint and OPPD joined the SPP in 2009. by determining which generation is dispatched for maximum cost-effectiveness. Figure 1.1: SPP Footprint, 2016 Source: SPP 2http://www.spp.org/about-us/newsroom/southwest-power- pool-expands-electric-grid-management-to-14-states/. Page 47 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 2 [PAGE 48] SECTION 1 - THE SOUTHWEST POWER POOL’S INTEGRATED MARKETPLACE CHALLENGES NEBRASKA’S PUBLIC POWER MODEL When the IM became operational in 2014, Since the start of the SPP the SPP consolidated 16 balancing authority areas into a single balancing authority. This meant that integrated marketplace, the SPP, instead of the individual SPP members, became responsible for balancing the supply and estimated electricity cost demand to ensure reliability over the entire SPP savings to MPs have totaled footprint. SPP does not own the transmission grid but independently operates it to ensure reliability, more than $1 billion. and manages long-term planning for future needs. The SPP members continue to own their transmission systems within the SPP footprint. How is the SPP market price Essentially, electricity is a commodity that is determined? traded like any other commodity. In the Integrated In the integrated market, each market Marketplace, the SPP acts as the market operator, participant bids in generation to supply their responsible for clearing transactions. As a market forecasted load for the following day as required operator, the SPP determines which power is bought by the SPP. The MP does not have to submit 100% and sold based on current demand (load) and supply of its forecasted load into the day-ahead market; a from electricity generators located throughout the portion of the forecasted load can be submitted into power pool footprint. the day-ahead market and the remaining portion The IM has a day-ahead market, where the of the load can be purchased from the real-time market price changes hourly, and a real-time market, market. where the market price changes every 5 minutes. Market participants bid generation into MPs can either submit load and generation into the IM based on their marginal cost of production, either the day-ahead or real-time market. as allowed by SPP requirements. The generation A total of 83,465 megawatts (MW) of bid amount does not include any fixed costs. The generation capacity is available from 756 generating following terms used for the SPP IM are defined for plants participating in the SPP integrated market. the purposes of this report: This currently provides a reserve capacity of 28% to Generation. Generation is the ability of ensure that the SPP can reliably meet demand for power plants to generate electricity that is bid into electricity during extreme peak times when loads the SPP IM. Generation is also known as capacity, are high. which is the amount of generation that a power To put this in perspective, all the current plant is capable of producing at a given moment generation in Nebraska could be eliminated and in time. For instance, if a 1,000 MW power plant is the excess reserve capacity in the SPP integrated sitting idle and is capable of producing 1,000 MW of market would be enough to supply all customer electricity if called upon (dispatched), then it would demand in Nebraska. have 1,000 MW of capacity that could be bid into the The SPP IM does not select generation SPP IM. If the same 1,000 MW power plant could based on fuel type but on bid price and reliability. only produce 800 MW of electricity, if called upon, The market determines the winners and losers of due to being derated, then it would only have 800 generation based on the marginal production cost, MW of capacity available to bid into the SPP IM, not which does not include any fixed costs. 1,000 MW. Since the start of the SPP integrated There are three types of generation: marketplace, estimated electricity cost savings to baseload, intermediate, and renewable. Baseload MPs have totaled more than $1 billion.3 generation is either fossil fuel or nuclear that are designed to operate at a constant output. 3https://www.spp.org/about-us/newsroom/total-savings-from- spp-s-markets-cross-the-1-billion-mark/. Page 48 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 3 [PAGE 49] SECTION 1 - THE SOUTHWEST POWER POOL’S INTEGRATED MARKETPLACE CHALLENGES NEBRASKA’S PUBLIC POWER MODEL Intermediate generation is designed Generation or Capacity Cost. This is the to change output more quickly than baseload difference between the cost of production and generation and is used when the demand for the SPP market price at the generator’s pricing electricity changes. node (Annual Cost of Production - Annual Revenue from the SPP IM). This is the cost to the Market Renewable generation output is based on the Participant for owning the generation. If the cost of conditions (wind and sun) at any given time. Due to production is more than the SPP market price, the variable weather conditions, renewable generation cost must be passed through to the ratepayers in cannot always generate at 100% of its rated output, the rates. SPP credits 10% of its rated output for capacity in the SPP IM. If a power plant that produces 6.8 million megawatt-hour (MWh) of electricity annually Marginal Cost of Production (or Incremental with a cost of production of $306 million, and the Energy Cost). This is the incremental cost of a average annual SPP market price is $20/MWh, the generator to produce electricity. This includes fuel generation cost for that year that must be passed on and variable operations and maintenance (O&M) to the ratepayers is $170 million ($306 million - (6.8 costs. Variable O&M costs are costs for items that million x $20)). are needed to produce electricity, but not needed when the plant is sitting idle. The marginal cost of The SPP combines the forecasted load production changes due to the plant’s efficiency (demand) of all market participants to determine at different outputs. The plant does not incur the how much generation is needed to provide the marginal cost of production when the plant is not most cost-effective and reliable combination of producing electricity. generation to be dispatched the following day. Fixed Cost. This is the generator’s cost For example, Figure 1.2 shows the that does not change based on the output of the forecasted load (demand line) and generation generation. This cost would be the same if the plant (supply curve) intersecting at the CCGT2 generator. was sitting idle or operating at 100% of its capacity. The SPP will dispatch CCGT2 and all the generation Fixed costs include items like labor, debt service, units left of CCGT2 (i.e. the generators with the routine maintenance, facilities, and corporate lowest marginal cost of production: CCGT1, Coal, charges. Lignite, Nuclear, Hydro, and Wind). In the day-ahead market, the forecast load and generation are bid Cost of Production. This is the total cost (offered) in hourly so the dispatch of generation of generation, which is sometimes referred to as and IM price changes hourly. If an MP’s generation busbar cost. Cost of production includes both the isn’t selected to be dispatched for any hour in the marginal cost of production and fixed cost. day-ahead market, the MP can bid their generation SPP IM Market Price. This is the price into the real-time market using the same bid criteria established by SPP based on the generation and as the day-ahead market. The MP is not required to load submitted by the SPP Market Participants submit their total forecasted load in the day-ahead into the SPP IM. The Market Participants purchase market; load can be purchased from the real-time electricity from the SPP IM at their purchase node. market at the real-time market price. For Nebraska public power, the SPP North Hub is The market price in the integrated market used for pricing the electricity that is purchased. is determined by the price of the next available Generation that is dispatched by SPP receives the generator that could be dispatched at the forecasted market price for their electricity at the SPP pricing demand (see Figure 1.2). The graph shows the node for the generation’s location. Each generation forecasted load (demand) and generation (supply) source in the SPP footprint has an SPP pricing node. curve intersect at CCGT 2’s marginal cost of Since cost data isn’t available for Nebraska public production. At this intersection point, the market power generation, the SPP North Hub market pricing price is established at the bid price (i.e. marginal will be used in this report. cost of production) of CCGT 2. If the market bid price for CCGT 2 was $23.74/MWh, then all Page 49 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 4 [PAGE 50] SECTION 1 - THE SOUTHWEST POWER POOL’S INTEGRATED MARKETPLACE CHALLENGES NEBRASKA’S PUBLIC POWER MODEL Figure 1.2: How the supply and demand of electricity signals price based on the dispatch order of different generation assets Source: Goss & Associates generation bids in the day-ahead market with lower as the marginal fuel supply, lower natural gas prices marginal cost of production than CCGT 2 (left of the put downward pressure on the wholesale market Demand line) would receive the same market price price in the SPP’s IM. of $23.74/MWh for that hour. As explained above, it becomes increasingly Since the IM bid (offer) price for generation important to own generation (capacity) with the is based on fuel price, the dispatch order can lowest cost of production, not the lowest marginal change depending on fluctuations of fuel prices for cost of production, when participating in the SPP different forms of generation. Due to the current integrated market. The MP’s customers must make generation mix and low gas prices in the SPP up the difference between the cost of production footprint, gas-fired generation is on the margin, and the market price. meaning that gas generators are typically the last Figure 1.3 profiles the relationship between generation units dispatched during high demand the price of natural gas and SPP wholesale (on-peak) periods. market prices. The data supports a strong positive During periods of very low demand (off- association between the price of natural gas peak), it is possible that the SPP IM price can and SPP market prices. In fact, the correlation go negative because there is more supply than coefficient between natural gas prices and SPP demand. Excess supply is created when large market prices from January 2012 to December 2014 baseload plants (e.g. coal and nuclear) are unable was 0.87 indicating that the two move in almost to change output levels fast enough to react to lockstep.4 changes in demand. Gas and renewable generators have the ability to rapidly adjust output, making them better able to capitalize on changing market conditions. 4The linear correlation coefficient, measures the strength and the direction of a linear relationship between two variables, in Natural gas prices have trended downward this case natural gas prices and SPP prices. The value ranges since the second half of 2008. Since electricity between -1.0 and +1.0. A larger the value, the greater the produced from gas-fired generators are dispatched association (e.g. +1.0 indicates two variables move in perfect lock step such as farenheit and centigrade temperature). NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 5 noitcudorP fo tsoC lanigraM Generation Fuel types Page 50 Agenda Item #7b [PAGE 51] SECTION 1 - THE SOUTHWEST POWER POOL’S INTEGRATED MARKETPLACE CHALLENGES NEBRASKA’S PUBLIC POWER MODEL Figure 1.3: Natural gas prices and SPP day ahead locational market price, Jan. 2012- Nov. 2014 Source: Goss & Associates, SPP and Federal Reserve of St. Louis Table 1.1 lists the electricity capacity It also supports the hypothesis that and consumption by fuel type. As indicated, the electricity producers have reduced utilization consumption and capacity of coal generation has (capacity factor) of electricity plants fueled by steadily declined, although coal consumption has coal.5 Likewise, the consumption of natural gas has declined more significantly than the capacity. This risen more dramatically than capacity. On the other indicates that utilities in the region have not altered hand, wind generation has expanded steadily and their generation mix capability as fast as market significantly over that time period. conditions dictate. Table 1.1: SPP capacity (2013-2015) and consumption (2013-2016) by fuel type Type 2013 2014 2015 2016 (rolling 365) Coal Capacity 34.1% 35.4% 33.3% Coal Consumption 61.2% 58.8% 55.1% 47.9% Natural gas Capacity 42.0% 46.5% 42.6% Natural gas Consumption 21.2% 18.9% 21.6% 23.4% Nuclear Capacity 3.3% 3.4% 3.2% Nuclear Consumption 6.0% 7.9% 8.1% 8.0% Wind Capacity 10.0% 11.5% 14.9% Wind Consumption 10.8% 11.8% 13.5% 16.7% Hydro Capacity 4.6% 1.1% 4.1% Hydro Consumption 0.6% 2.5% 1.5% 3.7% Other Capacity 26.8% 20.8% 23.1% Other Consumption 0.6% 2.5% 1.5% 0.3% Source: SPP 5For example, a 1,000 MW coal plant operating at an 80% capacity factor would produce 7.0 million MWH of electricity in a year (1000*.80*8760). For a 70% capacity factor it would generate 6.1 million MWH of electricity in a year (1000*.70*8760). Page 51 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 6 [PAGE 52] SECTION 1 - THE SOUTHWEST POWER POOL’S INTEGRATED MARKETPLACE CHALLENGES NEBRASKA’S PUBLIC POWER MODEL There are currently more than 12,000 MW of fuel cost on the margin, then it will have no effect on wind generation in the SPP footprint. The addition market prices, but if it is below, one can expect the of renewable generation and the retirement of coal market price to increase. and nuclear generation has impacted the market Effect of SPP Integrated Market on price. Since the fuel cost of wind energy is zero, and is dispatched first in the day-ahead market, wind Nebraska’s Public Power generation lowers the market price by displacing Prior to the SPP Integrated Market becoming generation with higher fuel cost. The retirement of operational in March 2014, Nebraska public nuclear generation, however, will increase market power was responsible for dispatching their own prices because nuclear has lower fuel costs than generation to match their load. They also acted as generation currently on the margin (gas-fired). The the balancing authority for Nebraska. effect on market prices from the retirement of coal plants depends on whether the fuel cost is above or This meant that nearly all generation below the fuel cost on the margin. If it is above the from power plants in Nebraska was used to serve the native load in Nebraska. Therefore, the Since the fuel cost of wind cost of production (fuel, variable operations and maintenance, and fixed) for generation was passed energy is zero, and is dispatched along to customers through rates. first in the day-ahead market, For an illustration of generation costs, see table 1.2. Note: the following information are wind generation lowers the approximations based on the best information available for various plant types. Nebraska public market price by displacing higher power has denied a request for information fuel-cost generation. concerning generation costs so actual cost data is not being used. Table 1.2: Breakdown of generation costs for specific types of power plants Marginal Cost of Cost of Production Plant Type Size (MW) Fixed Cost ($/MWh) Production ($/MWh)* ($/MWh) Large Coal 1,350 13.15 13.20 26.35 Small Coal 225 21.00 33.85 54.85 Nuclear 800 8.90 36.10 45.00 Combined Cycle 250 42.75 117.80 160.55 Wind 300 0.00 20.00** 20.00** * This would be the generation bid price in the SPP Integrated Market **This would be the Power Purchase Agreement (PPA) price The cost for each type of generation ratepayers were paying prior to 2014, when the SPP IM went operational, is as follows: Table 1.2a: Cost for each type of generation ratepayers were paying prior to 2014, when the SPP IM went operational Annual Output Cost of Annual Energy and Plant Type (MWh) Production ($/MWh) Demand Cost ($) Large Coal 9,650,000 26.35 254,277,500 Small Coal 1,120,000 54.85 61,432,000 Nuclear 6,800,000 45.00 306,000,000 Combined Cycle 137,000 160.55 21,995,350 Wind 1,314,000 20.00 26,280,000 Page 52 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 7 [PAGE 53] SECTION 1 - THE SOUTHWEST POWER POOL’S INTEGRATED MARKETPLACE CHALLENGES NEBRASKA’S PUBLIC POWER MODEL Prior to the SPP IM, and based on the costs in table 1.2a above, ratepayers would be charged $669,984,850 for their public power utility to provide them with electricity. If a utility sold 19,021,000 MWh, the generation cost (energy and demand) would have been $35.22/MWh. After the SPP went operational in 2014, energy and demand costs are separate, as illustrated in Table 1.2b. Note: for simplicity and illustration purposes, the 2015 SPP North Hub average market price is being used; in reality, every generation in SPP has a market price node for their location. Table 1.2b: Energy and demand costs Large Coal Small Coal Nuclear Combined Cycle Wind Cost of Production $26.35 $54.85 $45.00 $160.55 $20.00 ($/MWh) 2015 Average Market $20.28 $20.28 $20.28 $20.28 $20.28 Price1 ($/MWh) Annual Output (MWh) 9,650,000 1,120,000 6,800,000 137,000 1,314,000 Demand Cost ($/MWh) $6.07 $34.57 $24.72 $140.27 -$.08 Annual Demand Cost2 $58,575,500 $38,718,400 $168,096,000 $19,216,990 -$105,120 Annual Demand Cost3 $44,389/MW $172,082/MW $210,120/MW $76,867/MW -$350.40/MW 1 Energy Cost 2 Annual Cost to for generation that must be paid by the ratepayers as a demand cost 3 Annual Demand Cost ($) divided by Generation Size The Demand Cost ($/MWh) does not provide much value, the Annual Demand Cost is what is important since this amount must be included in the rates that the ratepayers must pay. The Annual Demand Cost expressed in $/MW is also important for determining the capacity cost relative to other types of generation . As shown in Table 1.2b, nuclear generation is the most expensive generation capacity. Using the information from the Table 1.2b above, the SPP market price is the energy cost. The capacity or demand cost for the utility’s total generation is $284,501,770/year or $14.94/MWh. The total energy and demand cost remains, as before the SPP IM went operational, at $35.22/MWh. As the energy price (SPP market price) decreases the demand cost for generation increases because the difference between the marginal cost of production and the market price isn’t high enough to further offset fixed costs. If the generation’s cost of production was lower than the market price, the generation would have negative demand cost and would have a positive cash flow. Page 53 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 8 [PAGE 54] SECTION 1 - THE SOUTHWEST POWER POOL’S INTEGRATED MARKETPLACE CHALLENGES NEBRASKA’S PUBLIC POWER MODEL Since the SPP IM went operational in March 2014, Nebraska public power no longer dispatches their own generation to supply electricity to their customers. Instead, they purchase power from the market, either day-ahead or real-time, which is supplied from generators within the SPP footprint with the lowest marginal cost of production (fuel and variable O&M). See Appendix B for an illustration on how the SPP Integrated Market works for generation and supplying electricity to market participants. When the SPP market price is lower than Nebraska public power generation’s marginal cost of production, the generation assets remain idle and Nebraska’s public power utilities purchase electricity from the IM at a cost lower than their generation can produce it because they will not be incurring the marginal cost of production. Purchasing electricity from the SPP IM when the market price is lower than the MP’s generators marginal cost of production saves the MP money and should ultimately save the ratepayer money because the MP is purchasing electricity cheaper than the cost of self-dispatching their generation to provide electricity to their customers, which they did prior to the SPP IM. Table 1.3 shows the average SPP market prices since the IM went operational in March of 2014. As shown, the market price has been lower every year since becoming operational. This is due mostly to the increase of wind generation in the SPP footprint and low natural gas prices. Table 1.3: Average SPP market price Average SPP market price (North hub) 2014 (As of March 1) $28.06 2015 $20.28 2016 (thru June) $17.34 Source: SPP Page 54 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 9 [PAGE 55] Section 2: Threats facing Nebraska’s Public Power Generation Introduction footprint.7 The SPP will have nearly 17,000 MW of The cost effectiveness of Nebraska’s public installed wind by the end of 2016, up from 12,397 power generation is currently at risk in the SPP IM. MW in 2015. An additional 2,000 MW is expected There are two main reasons for this: (1) low natural to be installed in 2017. As more wind energy is gas prices; and (2) additional wind generation in the produced, there is risk that Nebraska’s coal plants SPP footprint. will sit idle more often, less able to recover fixed Low natural gas prices keep the SPP IM costs, as electricity is dispatched from wind market price low. Gas-fired generators are the generation first, and mainly from other states within marginal supply, so bids from those generators the SPP footprint. typically sets the market price. Lower fuel costs for natural gas generators lead to lower bids in Excess Coal and Nuclear Generation the market since fuel is a major contributor to the when Natural Gas is Cheap generator’s bid price. Nebraska’s generation portfolio has a higher Low market prices threaten the coal and nuclear mix relative to the SPP generation competitiveness and ultimately the value of coal and mix. Table 2.1 shows the breakdown of NPPD’s nuclear assets owned by Nebraska public power. and OPPD’s generation mix compared to the SPP The second threat comes from additional generation mix. NPPD and OPPD combined have wind generation in the SPP footprint.6 Wind half the wind percentage and nearly 20 percent displaces higher cost fossil fuel generation when more coal capacity than the SPP generation mix. SPP dispatches generation. Significant increases in wind generation are expected in the SPP Nebraska’s generation portfolio has a higher coal and nuclear mix relative to the SPP generation mix. Table 2.1: Generation Mix comparison between NPPD and OPPD and the total SPP mix, 2015 NPPD and OPPD Generation Mix SPP Generation Mix Coal 52.2% 33.3% Natural gas & oil 18.8% 42.6% Nuclear 19.0% 3.2% Wind 7.0% 14.9% Other 3.1% 6.2% Total 100.0% 100.0% Source: SPP, NPPD, and OPPD Annual Reports 6Wind generation as a percentage of supply in the SPP contin- ues to set records, with penetration now exceeding 40 percent 7The SPP estimates that it can reliably handle up to 60 on certain days: http://www.platts.com/latest-news/electric- percent wind penetration: https://www.spp.org/docu- power/houston/us-southwest-power-pool-sets-new-wind-peak- ments/34200/2016%20wind%20integra¬tion%20study%20 record-21139345. (wis)%20final.pdf. Page 55 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 10 [PAGE 56] SECTION 2: THREATS FACING NEBRASKA’S PUBLIC POWER GENERATION Baseload capacity, like coal and nuclear, NPPD generates more than four million MWh is expected to continue to decrease in value as of excess generation (more electricity is sold to the wind generation capacity increases in the SPP.8 SPP market than purchased from the SPP market to For example, in September 2016, NPPD’s Sheldon serve their customers). In 2015, NPPD’s generation Station went offline because the SPP’s wholesale capability (capacity) was 3,660 MW and system market price was lower than its marginal cost of peak load was 2,695 MW.10 Since SPP requires production. It doesn’t make economic sense to burn Market Participants have generation capacity for the fuel to produce electricity which would have 112% of their peak load, NPPD had 642 MW of been sold below the fuel cost. Fixed costs, however, excess capacity. This excess generation would be at are still incurred while the plant sits idle. produced from NPPD’s Cooper Nuclear Station since this is NPPD’s generation with the highest annual cost of production. Baseload capacity like coal and Even when market prices are above the nuclear is expected to continue generation’s marginal cost of production, low market prices result in less revenue to help offset to decrease in value as wind the fixed cost of generation. OPPD’s decision generating capacity increases in to shut down the Fort Calhoun station can be seen as an indication of low forecasted market the SPP. prices in the SPP. OPPD determined that incurring decommissioning costs of over $1 billion today was more cost effective than shortfalls in covering fixed OPPD recently took action to shut down costs while keeping the station operating.11 Fort Calhoun Nuclear Station (FCS) because of its The price of natural gas has reached high cost of production and low SPP wholesale near record lows in 2016. This has driven SPP market prices. In 2015, OPPD’s generation capability IM wholesale market prices below $20/MWh for (capacity) was 3,080 MW and system peak load several months this year. Figure 2.1 shows this was 2,315 MW.9 With SPP requirements to have year’s monthly gas price (right axis) compared to the generation capacity for 112% of peak load, OPPD average monthly wholesale market prices (left axis) had 487 MW of excess capacity with FCS. Shutting in the SPP IM. down FCS will decrease excess generation and reduce generation costs to OPPD ratepayers. If additional generation is needed due to FCS being shutdown, OPPD can either replace The price of natural gas has the generation, by building new generation or reached near record lows in contracting generation from another supplier, with a lower annual cost of production. 2016. This has driven SPP IM wholesale market prices below $20/MWh for several months 8Energy Information Administration (EIA), ‘Higher wind 10NPPD Financial and Sustainability Report, 2015 (http://www. nppd.com/assets/publications/2015FinancialSustainabilityRep generation in the Southwest Power Pool is reducing use of ort/files/assets/basic-html/page-1.html#). baseload capacity’, http://www.eia.gov/today-inenergy/detail. php?id=12831. 11http://www.oppd.com/news-resources/news-releases/2016/ 9OPPD quick facts: http://www.oppd.com/media/216550/quick- june/oppd-board-votes-to-decommission-fort-calhoun- facts.pdf. station/. Page 56 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 11 [PAGE 57] SECTION 2: THREATS FACING NEBRASKA’S PUBLIC POWER GENERATION Figure 2.1: SPP IM wholesale market prices versus the cost of natural gas Source: SPP State of the Market Report, Summer 2016 The future price of natural gas is uncertain, In October 2015, the SPP expanded its but projections of supply growth versus demand footprint to cover most of North Dakota and growth in the United States indicate that excess South Dakota, and parts of Montana. This added a supply from shale will remain. Projections by substantial amount of wind generation to the SPP, the U.S. Energy Information Administration raising wind generation as a percentage of total (EIA) indicate that by 2020 domestic supply will generation resources. As a result, more wind is substantially outpace domestic consumption, now available to dispatch prior to other sources of making the U.S. a net exporter.12 Expect excess generation. domestic supply to put downward pressure on the In addition, wind generation in the SPP price of natural gas. footprint is currently growing and is expected to Although U.S. energy policy is uncertain continue to grow because of the recently renewed going forward, the potential implementations federal renewable electricity production tax credits of regulations from the Clean Power Plan could (PTC). The PTC is an inflation-adjusted per-kilowatt- continue to increase the cost of production of fossil hour (kWh) tax credit for electricity generated by fuel generation. With Nebraska’s heavy reliance on qualified energy resources. The electricity must coal, there is a presence of regulatory risk. be sold by the producer to an unrelated person or organization. Originally the duration of the credit Renewables Displace Baseload was 10 years for all facilities placed into service Generation after August 8, 2005. The growth in low-cost wind generation in In December 2015, Congress passed the SPP footprint is putting downward pressure on the Consolidated Appropriations Act, which the SPP IM wholesale market prices. As the amount extended the expiration date for this tax credit to of wind generation increases throughout the SPP December 31, 2019, for wind facilities commencing footprint, expect this low-cost source of generation construction. For 2016, the inflation adjustment to drive down average wholesale market prices in factor used by the IRS is 1.556, resulting in a 2016 the SPP IM as it displaces fossil-fueled baseload calendar year tax credit amount of $0.023/kWh. The generation. tax credits do, however, phase down with projects commencing construction after December 31, 2016. 12http://www.eia.gov/pressroom/presentations/siemin- ski_06282016.pdf.. Page 57 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 12 [PAGE 58] SECTION 2: THREATS FACING NEBRASKA’S PUBLIC POWER GENERATION The tax credit phase-down for wind facilities Since the private wind developer is a percentage reduction in the tax credit amount listed above: (a) for wind facilities commencing can receive tax credits, the price construction in 2017, the PTC amount is reduced by 20 percent, (b) for wind facilities commencing of PPAs incorporate those cost construction in 2018, the PTC amount is reduced by savings, allowing Nebraska 40 percent, and (c) for wind facilities commencing construction in 2019, the PTC amount is reduced Public Power to indirectly benefit by 60 percent. The duration of the credit is 10 years after the date the facility is placed in service.13 from overall cheaper wholesale These recently renewed tax credits are prices of electricity. incentivizing wind generation investment throughout the SPP, putting downward pressure on the IM wholesale price. Nebraska’s public utilities do PPAs to purchase wind energy are currently not pay taxes and therefore are unable to directly averaging $20/MWh in the interior states, according benefit from tax credits. However, in most cases, to recent analysis by the Berkeley Lab and the U.S. wind generation is purchased from a private wind Department of Energy.14 PPAs at this price are developer through a Power Purchase Agreement significantly less than NPPD’s and OPPD’s average (PPA). generation cost of production, and below the average 2015 SPP IM wholesale market price. These recently renewed The growth of wind generation throughout tax credits are incentivizing the SPP will displace baseload generation in the dispatch order, raising the risk that baseload plants wind generation investment sit idle more often. This will raise the overall costs to own those types of plants, since revenue will not be throughout the SPP, putting generated to help offset fixed costs. This increases downward pressure on the IM the risk that costlier generating assets will be forced to close as demand for baseload will not keep pace wholesale price. with this additional generation capacity. The growth of wind generation Nebraska’s public power benefit from federal tax credits indirectly because they are factored throughout the SPP will displace into the PPA price along with any other capital or fixed costs incurred by wind generators. The PPA baseload generation in the price for electricity can be thought of as the cost dispatch order, raising the risk of production when comparing to other types of generation. that baseload plants sit idle more often. 13Renewable energy facilities placed in service after 2008 14PPAs for wind in the interior states have a significant cost and commencing construction prior to 2015 (or 2020 for wind advantage to the rest of the nation. In 2013, wind PPAs signed facilities) may elect to make an irrevocable election to claim the in the interior states averaged between $20-$25, whereas the Investment Tax Credit (ITC) in lieu of the PTC. Wind facilities Great Lakes region averaged above $40 and the West and making such an election with have the ITC amount reduced by Northeast region averaged above $50: http://energy.gov/sites/ the same phase-down specified above for facilities commenc- prod/files/2016/08/f33/2015-Wind-Technologies-Market-Report- ing construction in 2017. Presentation.pdf. Page 58 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 13 [PAGE 59] SECTION 2: THREATS FACING NEBRASKA’S PUBLIC POWER GENERATION Since wind generation is intermittent, it only It is true that Federal Tax Credits are a key receives capacity in the SPP integrated market for driver of the expected growth in wind generation only 10 percent of its nameplate capacity (i.e. 10 throughout the SPP footprint. After the tax credits MW for a 100 MW wind farm). This is unlike other expire, expect investment in wind to lessen. types of generation, which receive credit for the full However, cost of wind generation is falling rapidly amount of nameplate capacity. Wind generation is and is expected to become competitive, even bid into the SPP IM the same as other generation, without tax credits, relative to new builds of other but the credit counted toward market capacity forms of energy.16 requirements is different. If new generation (capacity) is needed to This is done to ensure that there is enough supply demand growth in the future, expect wind generation available when the wind does blow. and solar to compete with new builds of coal, Expect the SPP to consider larger capacity credit for natural gas, and nuclear.17 The cost of solar has wind in the future as energy storage technologies fallen rapidly in recent years due to increases in advance to alleviate intermittency concerns.15 investment worldwide.18 This will further decrease the value of baseload generation. 16Lazard estimated that the unsubsidized levelized cost of en- ergy for wind has decreased 61 percent from 2009 to 2015. The unsubsidized levelized cost of energy for solar has decreased 82 percent during that same period. New wind builds, unsubsi- dized, now average between $32-$52/MWh, compared to new coal at $61-$150/MWh and new natural gas at $52-$78/MWh. 17The EIA projects that in 2022 the LCOE for wind and solar will be $64.50/MWh and $84.70/MWh, respectively, compared new builds of coal to be $139.50/MWh and nuclear to be $102.80/ MWh. New builds of natural gas LCOE is expected to range from $57-$84/MWh: https://www.eia.gov/forecasts/aeo/pdf/electric- ity_generation.pdf . 15Although unproven in the market, industrial-sized batter- 18The learning curve (i.e. production cost decrease) for solar follows a trend called Swanson’s Law. Swanson’s Law is the ies have seen some traction at the utility level. Tesla recently observation that the cost of solar decreases 20 percent every signed a deal to supply a California utility with industrial time the cumulative shipped volume of photovoltaics doubles. capacity lithium batteries to reduce intermittency concerns Worldwide shipments of photovoltaics are growing fast, led by from renewables: http://www.bloomberg.com/news/ar- investment in Asia, with a compounded annual growth rate of ticles/2016-09-15/tesla-wins-utility-contract-to-supply-grid- 42 percent from 2000-2015: https://www.ise.fraunhofer.de/de/ scale-battery-storage-after-porter-ranch-gas-leak. downloads/pdf-files/aktuelles/photovoltaics-report-in-englisch- er-sprache.pdf. Page 59 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 14 [PAGE 60] Section 3: A Case for Retail Choice in Nebraska: The effect on electric rates, reducing ratepayer risk, and the need for greater transparency using unbundled billing A Case for Unbundling and Retail Choice in These functions were all turned over and are now the responsibility of the SPP. Nebraska As part of being members of the SPP, Nebraska public power has changed Nebraska public power no longer maintains the significantly since 1936 when public power was reliability of the transmission system in the state. established to provide power to rural customers Transmission owned by Nebraska public power in Nebraska. More changes came when Nebraska is regulated by the Federal Energy Regulatory public power joined the Southwest Power Pool in Commission (FERC). In 1996, FERC issued Order 2009 and began participating in the SPP Integrated 888 to provide “open access” to transmission at Market in 2014, where they now buy and sell non-discriminatory rates to third-party electricity wholesale electricity. providers to allow for a competitive wholesale Today with competitive wholesale energy electricity market. markets, electricity is no longer a natural monopoly. What this means is that private electricity Transmission and distribution systems, however, generators (e.g. wind farms) or power marketers do remain for the most part natural monopolies are able to use transmission infrastructure owned because it is typically not economical to duplicate by Nebraska public power for a regulated, set rate, transmission and distributions systems in a given which is non-discriminatory. This open-access area. Providing electricity and being a transmission infrastructure makes retail choice possible, where owner are two completely different business private power marketers with access to competitive models, and as such it makes no sense for them to generation and/or lower overhead costs can be bundled together. participate in the electricity market and potentially Participating in a competitive wholesale provide more competitive options to ratepayers in market involves much risk and uncertainty, whereas the state. being a transmission owner involves little risk Furthermore, according to Nebraska (mainly weather events) since the same amount of legislative research, three conditions must be met electricity is transported through the transmission for customer (retail) choice to be effective and system regardless of who is providing the electricity. beneficial to the citizens of Nebraska.19 They are: This is also holds true for the distribution system. The transmission and distribution system owner has • A viable regional transmission organization and the responsibility for maintaining their system to adequate transmission must exist in Nebraska deliver electricity from the wholesale market to the or a region that includes Nebraska; end-use (retail) customer. • A viable wholesale electricity market must exist In 2009, when Nebraska public power joined in a region that includes Nebraska; the SPP, Nebraska was no longer an electricity • Wholesale electricity prices in the region must island, but part of a much larger market-based RTO. be comparable or competitive to Nebraska The landscape changed even more dramatically prices. in 2014 when the SPP IM became operational. In this environment, Nebraska public power no longer dispatches power plants or supplies electricity 19Annual report – Monitoring of “Conditions Certain” Issues 2010 Report in Neb. Rev. Stat. 70- to their customers with their own generation. 1002 (6) to (8), dated 2010. Page 60 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 15 [PAGE 61] SECTION 3: A CASE FOR RETAIL CHOICE IN NEBRASKA The report at the time stated that the first two conditions were satisfied and the last condition was not satisfied. However, since the report was last issued in 2010, Nebraska public power has significantly raised rates across the board and wholesale market prices have dropped significantly. Figure 3.1 shows industrial rates in Nebraska compared to the United States from 2005 to 2014. Compared to US averages, the industrial rate in Nebraska became more expensive in 2012. Comparing Nebraska’s rates to the U.S. understates how uncompetitive the state is to the surrounding region, as electricity rates on the East and West coast are usually significantly higher than the Midwest. Having uncompetitive industrial rates is a deterrent for bringing and keeping companies in Nebraska. Figure 3.1: Nebraska’s average industrial rate (cents per kWh) per year compared to the U.S. 2005-2014 Source: EIA Wholesale market prices in the SPP IM are currently more competitive as well. Based on figures reported in NPPD’s and OPPD’s annual report, SPP IM wholesale market prices are substantially below the cost of production for NPPD’s and OPPD’s generation. As shown in Table 3.1, in 2015, NPPD had an average generation cost of production of $28.21/MWh and OPPD had an average generation cost of $32.11/MWh.20 The 2015 average SPP IM day-ahead market price was $22.84/MWh and the real-time market price was $21.68/MWh.21 The 2015 SPP average IM prices include both the North and South Hub. NPPD and OPPD had generation cost of production that were 23.5 percent and 40.6 percent, respectively, higher than the SPP IM day-ahead market price. Both the recent rise in rates for consumers and the decreasing market price of wholesale electricity satisfy the third criteria listed above. Retail choice in Nebraska would be effective and beneficial according to the guidelines of the legislative report discussed above. As outlined in Section 2, lower wholesale market prices are the result of low natural gas prices and more renewable sources of generation in the SPP footprint. Natural gas prices in 2017 are expected to remain lower than the average price of the last five years.22 Renewable generation is expected to expand significantly within the SPP footprint over the next few years due to the five-year extension of production tax credits. Expect wholesale market prices to remain low as the renewable market matures and natural gas extraction continues to provide plentiful supply. This environment has resulted in wholesale market prices in the SPP IM dropping below the cost of production of coal and nuclear generation, creating additional losses for those types of plants. 20Reported average NPPD and OPPD generation costs presented here due not include capital costs or debt servicing costs, therefore these figures underestimate the true cost of generation, but still provide a conservative comparison for competitiveness to market prices. 21These prices were averaged from the SPP North and South Hubs. Source: SPP State of the Market Report, Winter 2016; https://www. spp.org/documents/37619/qsom_2016winter.pdf. 22https://www.eia.gov/forecasts/steo/report/natgas.cfm. Page 61 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 16 [PAGE 62] SECTION 3: A CASE FOR RETAIL CHOICE IN NEBRASKA Table 3.1: Comparison of NPPD and OPPD average generation costs versus the SPP 2015 integrated market average prices NPPD average generation cost $28.21 OPPD average generation cost $32.11 SPP IM day-ahead average price $22.84 SPP IM real-time average price $21.68 Source: SPP, OPPD and NPPD annual reports The decision to decommission OPPD’s Fort This arrangement is commonly referred to Calhoun nuclear plant depended partially on the as “retail choice.” In a competitive, retail choice expectation that wholesale market prices in the SPP environment, Nebraska public power could pursue IM would remain low, making the plant expensive a strategy of competing in the energy market or to operate relative to other generation resources. divest from owning generating assets, and instead, This controversial decision is a signal that OPPD’s focus solely on the management and operation of leadership does not expect wholesale market prices transmission and distribution systems. to return to levels where this nuclear station would Retail choice would incentivize competition be cost effective. by owning generation with the lowest production The financial risk to ratepayers in owning costs and maintaining low corporate overhead generation is increasing, as seen with the shutdown costs. This would substantially reduce the risk and and decommissioning of the Fort Calhoun plant. uncertainly to the ratepayer in a changing energy Divesting from generating assets and embracing market. retail choice could reduce ratepayers’ risk by NPPD Wholesale Power Contact eliminating the potential future costs of stranded assets. In this case, stranded assets are generating Renewal assets such as coal or nuclear plants that decrease In 2015, many rural public power districts in production value due to a change in the and municipalities approved a new 20-year economics of the industry. NPPD 2016 Wholesale Power Agreement.23 This agreement requires that those who approved the Stranded assets are generating contract to purchase the majority of their wholesale assets such as coal or power requirement from NPPD who buys the power from the SPP IM. The agreement does not specify nuclear plants that decrease any price for the electricity but only a performance criteria that allows the customer to decrease the in production value due to a required amount of electricity that is purchased from NPPD if NPPD’s rates go up drastically. change in the economics of the Several of NPPD’s current wholesale industry. customers did not sign the NPPD 2016 Wholesale Power Agreement, and decided instead to contract Currently, inexpensive renewable generation, with other wholesale power providers.24 This is greater environmental regulations, and an excess possible due to the competitive wholesale markets supply of natural gas threaten the competitiveness and open access to transmission. of Nebraska’s coal and nuclear plants, raising the risk that more plants will become more uneconomical in the future. 23NPPD 2016 wholesale power contract (http://info.cityoflex. A more competitive energy landscape would com/ccdocs/meeting/2015/October27/5C102715.pdf). allow consumers to choose among public and 24http://www.omaha.com/news/nebraska/rising-rate-hikes- private power providers in the state. prompt-some-nppd-customers-to-look-to/article_d99e15f9- e41d-58dc-8c3d-ac03c7cc36ec.html. Page 62 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 17 [PAGE 63] SECTION 3: A CASE FOR RETAIL CHOICE IN NEBRASKA The Cost Composition of Electricity Transmission Cost: This is the cost the wholesale power provider pays to get the Rates electricity from the energy market to the wholesale To understand how divesting from customer. Wholesale power is transported through generation and embracing retail choice in Nebraska transmission lines. The wholesale power provider would affect ratepayers, it is important to know the may or may not own the transmission lines. The composition of electric rates and how each cost cost to use the transmission system is the same component would be affected. for all wholesale power providers that uses the transmission system. Electric rates are made up of various components that recover the electricity provider’s Distribution Cost: This is the cost the local costs to deliver their product to the customer. The energy provider, usually a rural power district or two major types of electric rates are wholesale and city, pays to get the wholesale electricity from the retail. transmission system to the retail customer. Wholesale Rate: Wholesale power is the Overhead: This is the cost that determines if bulk electricity that is delivered by a wholesale the wholesale power provider’s rate is competitive, power provider to the retail electricity providers for because the costs for electricity and transmission resale to its customers. Bulk electricity is bought are essentially the same for all wholesale power and sold into an energy market similar to other providers. Overhead costs include demand, debt commodity markets. The major cost components service, administration, employee healthcare and that go into a wholesale rate are: energy cost, pension plans. demand cost, transmission cost and the wholesale One other major component of overhead power provider’s overhead. For NPPD in 2014, the is demand (capacity) costs. As mentioned above, breakdown for wholesale energy costs is; 47% capacity is the ability to generate electricity that Energy, 39% Demand, 10% Transmission, and 4% can be supplied to the energy market at any given other. time when called upon to meet the market demand Retail Rate: The retail rate is what the for electricity. The wholesale power provider must end-use customer pays for electricity. There are either own or purchase capacity to meet the energy typically three categories of retail rates that are market requirements for capacity (i.e. if a wholesale based on electricity usage: industrial, commercial, power provider is going to purchase 100 MW of and residential. Wholesale power is delivered to the electricity, then it must have at least 100 MW plus retail customer by the local distribution entity after required SPP margin of capacity available). adding on the distribution charge. Local entities are It should be noted that just because a MP often rural electric associations (REAs) or cities. has 100 MW of capacity available, generation The end rate paid by the retail customer is the retail from another market participant might be used to rate. The retail rate includes the wholesale power produce the electricity needed to supply the MP’s cost and distribution cost to the customer. The 100 MW load. breakdown of the cost components of the retail rate is generally: 60% wholesale electricity cost, 10% Generation or capacity cost is comprised of transmission, and 30% distribution. the total expenses (fuel, operation & maintenance, facilities, capital improvement, etc.) minus the Electricity Cost: This is the cost the revenue from selling the electricity generated to the wholesale power provider pays to purchase the energy market, such as an SPP integrated market. electricity from the energy market. The energy Capacity costs vary significantly depending on the market updates the electricity price every hour in type of generation (i.e. coal, nuclear, gas, renewable, the day-ahead market and every five minutes in the hydro). real-time market. The average 2015 market price for Nebraska public power was $20.28. Page 63 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 18 [PAGE 64] SECTION 3: A CASE FOR RETAIL CHOICE IN NEBRASKA The Importance of Cost-Based Rates Unbundled billing improves transparency and accountability by separating the cost components of The electricity rates on a ratepayer’s most the rate that the electric utilities charge. An example recent bill might not represent the true cost of of an unbundled bill is illustrated in Appendix C, power. It is possible that a utility could defer costs Example of an Unbundled Bill. (i.e. pensions, retirement, decommissioning, debt, etc.) into the future in order to avoid raising rates For example, an unbundled bill would show in the present. These deferred costs, also known separate charges for energy, demand, transmission, as unfunded liabilities, could expose customers to and distribution, supplemental charges, which all unexpected higher rates in the future. contribute to the overall rate. Additional charges such as decommissioning costs and metering An unfunded liability exists when a utility charges should also be included in a properly incurs an expense but defers payment. If current unbundled bill. This line-by-line billing information rates are based on deferred expense, the rate allows the ratepayer to scrutinize each component. doesn’t represent the true cost of electricity today. When rates increase, an unbundled bill would Therefore, once those unfunded liabilities come indicate the factors that caused it. due, future customers will face higher rates, while customers today obtain the benefit. Unbundled bills should be a staple in public power districts and cities in Nebraska. As An unfunded liability exists when a public power state, Nebraska’s ratepayers vote for the board of directors of the public utilities a utility incurs an expense but that represent and serve them. A voter should be informed by seeing which costs drive any defers payment. If current rates rate changes. Without this level of transparency, are based on deferred expense, ratepayers lack the knowledge to make informed decisions when electing the board of directors the rate doesn’t represent the who have the fiduciary responsibility to hold management accountable for decisions it has made. true cost of electricity today. The National Energy Marketers Association (NEM) says that “proper rate unbundling is a When the ratepayer is locked into a prerequisite to sending proper price signals, to monopolistic power provider and cannot choose assist in making educated consumption decisions, from whom they purchase electricity, the rate and to permit suppliers to invest risk capital to make should be cost-based to avoid receiving benefit competitive product and service offerings available from services they are not paying for. As described to consumers.”25 above, deferred costs by an electricity provider (public or private) are unacceptable for cost-based Increased transparency from unbundled rates. If an electricity provider (public or private) billing is also important in today’s changing makes bad business decisions, future ratepayers energy landscape because of competition from suffer the outcome because there is no other option renewable sources of generation. The preference for the customer to choose. The utility suffers no for renewables is often overshadowed by the consequences in the form of lost customers as the assumed higher costs rather than recent objective result of its decisions. data. Unbundled bills would give Nebraska ratepayers insight into whether renewable sources Providing Cost Transparency through of generation are cost effective compared to current Unbundled Billing sources such as coal and nuclear. Alternative sources of generation, such as wind or solar, could With several cost components making up be offered by companies competing in a retail an electric rate, it is important that consumers choice environment. understand what is driving any changes in their rates. Consumers can gain insight into costs of 25https://www.energymarketers.com/Documents/nem_me_un- electricity production through unbundled billing. bundling_ nal_cmts.pdf. Page 64 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 19 [PAGE 65] SECTION 3: A CASE FOR RETAIL CHOICE IN NEBRASKA Having the costs separated, particularly distribution and transmission, would allow consumers to clearly compare prices of different energy providers. There is nothing physically (transmission or distribution) to prevent retail choice from being implemented in Nebraska. With retail choice, the only thing that would need to change would be a line item on the bill to show who the customer is purchasing electricity from. The transmission and distribution cost would remain the same as it is currently, with local entities delivering the electricity to the consumer. SPP is responsible for the planning and reliability of the transmission system. All repairs would still be handled the same as they are today, by the local distribution or transmission system owners. Electricity is the competitive component of a customer’s bill, whereas other charges are non- competitive; all retailers rely on the same transmission and distribution systems and incur the same charges. In a retail choice environment, electricity providers compete on how efficiently they can supply a commodity: electricity. Unbundled bills give clear information on who supplies electricity in the most cost-effective manner. Retail Choice in Practice Seventeen states have adopted retail choice. The level of adoption differs, with some states allowing full retail choice for all customers, and others providing it only to commercial and industrial customers. Retail choice becomes more important as competing sources of electricity production enter the market. Without retail choice, consumers are left with no other option than one with expensive rates if the monopoly utility makes poor business decisions such as choosing the wrong portfolio of generating assets. Figure 3.2 shows states that have implemented some form of retail choice. Figure 3.2: States that have implemented retail choice Source: EIA Retail choice in Texas is administered by the Public Utility Commission through the website powertochoose.org (see Appendix D). This site provides a good example of how retail choice could work for residential, commercial, and industrial ratepayers in Nebraska. After entering a zip code, the ratepayer is shown multiple competitive offers from different electricity retail providers available in their area. Offers mainly differ in terms of price and contract length. Page 65 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 20 [PAGE 66] SECTION 3: A CASE FOR RETAIL CHOICE IN NEBRASKA Some contracts last only three months while others last an entire year. This gives the ratepayer A retail choice environment the option to lock in a current rate for an extended promotes competition among time, if that rate predictability is well-suited to their budget. Some retail providers offer rates based on suppliers and matches the source of generation. This gives the ratepayer the option to buy electricity from a retailer that preferences to consumers. sources electricity entirely from renewables, if that’s preferred. If consumers prefer renewable sources Some retail providers offer of generation, a retail choice environment would rates based on the source be able to match that preference effectively. A competitive environment increases both productive of generation. This gives the and allocative efficiencies.26 ratepayer the option to buy Potential Cost Savings from Retail Choice electricity from a retailer that The price of a retail rate is comprised sources electricity entirely from of approximately 60 percent generation cost, 30 percent distribution cost, and 10 percent renewables, if that’s preferred. transmission cost. The ability of retail choice to offer competitive rates is dependent on the costs of each retailer’s owned generation mix and/or costs of wholesale purchases. The conditions that can Electric retailers offer different rates affect wholesale energy costs can change rapidly, because each company has its own strategy and are variable throughout the state. For example, when it comes to sourcing the most cost effective the current market price for wholesale energy sources of generation. Generation costs are based supplied through wind PPAs has recently dropped on many variables, most prominently fuel costs to levels that are very competitive to other sources and technological advances. Since those variables of generation. Compared to the costs of owning are unknown in the future, strategic decisions and operating coal and nuclear plants, a retailer should be made in an environment where market that is able to quickly adapt and execute wholesale forces dictate the allocation of capital, which is not purchases in favorable market conditions would be possible in a monopoly environment. The invested in a more competitive position. The combination of capital financed by ratepayers is at risk with low-priced wholesale electric purchases and less publicly-owned generation, whereas, in retail choice, overhead expense, should allow providers to put private investors bear the investment risk. competitive downward pressure on rates in a retail A retail choice environment promotes choice environment. competition among suppliers and matches To illustrate the variability in retail rates preferences to consumers. This ensures that the throughout the state, see Appendices E and F. most cost-effective strategy to procure generation is available, which is passed on to consumers through lower rates. Ineffective generation investment strategies will be uncompetitive, ceasing to exist. On the demand side, consumer choice is especially important in being able to match production to consumer preferences, especially in regards to 26Productive efficiency is the ability to produce at the lowest environmental concerns. cost. Allocative efficiency is the ability to match production with consumer preferences. Market failures occur when the econo- my fails to allocate resources efficiently. Page 66 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 21 [PAGE 67] SECTION 3: A CASE FOR RETAIL CHOICE IN NEBRASKA In the competitive wholesale environment, According to the EIA, in 2015 Nebraska power districts, cities, and regional utilities are able ratepayers paid more than $2.5 billion for to seek out the lowest cost wholesale supply, as electricity.28 The ratepayer could save between did twelve cities and a regional utility in Nebraska.27 $250-$400 million annually if retail choice was For example, instead of NPPD, South Sioux City has permitted in Nebraska as demonstrated by the signed a wholesale provider contract with a utility in public power districts and cities that chose to Ohio and Northeast Nebraska Public Power District purchase their power from utilities outside of the has signed with a provider in Kentucky. Nebraska Public Power System. Since the SPP IM went operational, the competitive market price This is because approximately 60 percent for electricity has dropped 38% but Nebraska of the retail rate a city or regional utility offers to public power electric rates have not decreased. In consumers is made up of the wholesale cost of fact, many ratepayers are having to pay more for electricity, so the cheaper they can procure this electricity because NPPD and OPPD are increasing electricity supply, the more cost savings they can the customer charges due to sustained revenue pass on to consumers. shortfall from external market factors and lower In contracting with cheaper wholesale customer usage. providers, entities like Northeast Nebraska Public The Nebraska Public Power Model currently Power and South Sioux City have less costs incurred is not effective in the SPP wholesale power market with this wholesale supply component of the rate, due to past and current decisions to build and which can then get passed on to end users in the maintain generation resources. With a wholesale form of cheaper rates. power market in place, the Nebraska Public Power This explains some of the rate variability Model should be changed to allow free market possible throughout the state. Similar competitive principles to work to lower electricity prices for forces, as seen in the wholesale competitive market, the ratepayer. This would be consistent with the could lead to additional downward pressure on rates findings of the legislative study for retail choice in if applied to the retail environment. Nebraska. 27http://www.omaha.com/news/nebraska/cities-regional-utility- turn-down-new-nppd-contracts/article_205502e9-d68b-5cf5- 28http://www.eia.gov/electricity/sales_revenue_price/ 8c5c-23eecf9aa5ec.html. Page 67 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 22 [PAGE 68] Appendix A: SPP market participants (source: https://www.spp.org/about-us/footprint/) Alliant Energy Corporate Services, Inc. Flat Ridge 2 Wind Energy NSP Energy Trading American Electric Power West Franklin Power Occidental Power Services Appian Way Energy Partners Southwest, LLC Freepoint Commodities, LLC Oklahoma Gas & Electric Company APX Galt Power Oklahoma Municipal Power Authority Arkansas Electric Cooperative Golden Spread Electric Cooperative Omaha Public Power District Associated Electric Cooperative, Inc. – Power Market Goodwell Wind Project Oneta Power ATNV Energy, LP Google Energy Otter Tail Power Company Automated Algorithums Grand River Dam Authority Peninsula Power, LLC Basin Electric Power Cooperative GRG Energy Pharetram Energy Services, Ltd. BioUrja Power, LLC Guzman Energy Powerex Corp. BJ Energy H.Q. Energy Services US Public Service Co. of Colorado Black Hills Power Harlan Municipal Utilities Public Service Co. of Colorado MISO MP Black Oak Energy LLC Hastings Utilities Pure Energy Blackout Power Trading Heartland Consumers Power District Rainbow Energy Marketing Blue Canyon Windpower Hexis Energy Trading Resale Power Group of IOWA Boston Energy Trading & Marketing High Majestic Wind II RPM Access LLC BP Energy Company Iberdola Renewables Saracen Energy Midwest Brookfield Energy Marketing LP Inertia Power III Seiling Wind LLC Brookfield Renewable Energy Group Intergrid Midwest Group Sempra Generation BTG Pactual Commodities (US) Invenergy Energy Management SESCO SPP Trading LLC Buffalo Dunes Wind Project J. Aron and Company Shell Energy North America Calicot Energy Kansas City Board of Public Utilities Smoky Hills Wind Project II Calpine Energy Services Kansas City Power and Light Solea Energy, LLC Canadian Woods Products Kansas Municipal Energy Agency Southern Company Services Caney River Kansas Power Pool Southwestern Public Service Canopus Power Trading, LLC Kentucky Municipal Power Agency Sunflower Electric Power Cargill Power Markets Lincoln Electric System Sustaining Power Solutions Carpe Diem Trading II Little Elk Wind Project SW Power Trading, LLC Castleton Power Trading, LLC LM Power TEC Energy, Inc. Chisholm View Wind Project Macquarie Energy Tenaska Power Services Cimarron Wind Energy MAG Energy Solutions Tennessee Valley Authority Citigroup Energy Marshall Wind Energy The Energy Authority City of Chanute Mercuria Energy America Tios Capital, LLC City of Fremont Merrill Lynch Commodities TPS1 City of Grand Island MET Southwest Trading TPS2 City of Independence, Mo. MidAmerican Energy Company TPS3 Conoco Phillips Midwest Energy TPS4 CP Bloom Wind Midwest Energy Trading East TPS5 Cumulus Master Fund Minco Wind TPS6 Darby Energy Minnesota Muncipal Power Agency TPS7 DC Energy Midwest Minnkota Power Cooperative, Inc. TPS8 DC Transco, LLC Missouri Joint Municipal Trailstone Power Dempsey Ridge Wind Farm Missouri River Energy Services TransAlta Energy Marketing (U.S.) Inc. Denver Energy Montana-Dakota Utilities Trumpet Trading LLC Dogwood Power Management Monterey SW Tungsten Power LP DTE Energy Trading Monterey SWF Twin Eagle Resource Management Dufossat Capital VI Morgan Stanley Capital Group Uncia Energy LP - Series D Dynasty Power Morningstar Commodity Data, Inc Utilities Plus East Texas Electric Coop Municipal Energy Agency of Nebraska Velocity American Ecesis NextEra Energy Power Marketing Vitol EDF Trading North America NJ Resources Westar Energy EDP Renewable North America Noble Americas Gas & Power Western Area Power Admininstration - Rocky Mountain Region eKapital Investments Noble Great Plains Windpark Western Area Power Administration - Upper Great Plains Marketing Emera Energy Services Northern States Power Western Area Power Administration Empire District Electric Northpoint Energy Solutions Western Farmers Electric Cooperative Endurance Energy Midwest LLC Northstar Trading LTD XO Energy SW ETC Endure Energy NorthWestern Corporation dba NorthWestern Energy XO Energy SW2 Page 68 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 23 [PAGE 69] Appendix B: Illustration of Southwest Power Pool Integrated Market Market Participants submit bids for both their load and generation for each hour in the day-ahead market. Suppose an SPP Market Participant (MP) forecasts that their load (demand) for the following day at hour-12 will be 2,300 MWh. The MP submits a bid for their load into the day-ahead market for hour-12 the following day for 2,000 MWh (SPP does not require that 100% of the forecasted load be bid into the day-ahead market). The SPP will purchase the remaining 300 MWh forecasted load in the real-time market. SPP requires the MP to submit generation bids into the day-ahead market with at least enough generation (capacity) to meet 112% of the load that was bid into the day-ahead market (2,240 MWh) for hour- 12. The 112% requirement is to ensure that there is enough margin for reliability in case the demand is higher than expected. In the illustrative example below, the MP bids in the following generation into the day-ahead market for hour-12: Table B1: Illustrative example of MP bids for generation into the day-ahead market for hour-12 Marginal Cost of Amount Cost of Production Production2 Wind 200 MWh1 $0/MWh $20.003/MWh Nuclear4 800 MWh $8.90/MWh $45.00/MWh Large Coal 1,350 MWh $13.15/MWh $26.35/MWh Small Coal 225 MWh $21.00/MWh $54.85/MWh Combined Cycle 250 MWh $42.75/MWh $160.55/MWh 1 Wind generation is only credited 10% of rated nameplate or 20 MW toward the 2,240 MWh bid requirement 2 SPP generation bid price only includes fuel and variable operation & maintenance costs 3 This is recent Power Purchase Agreement cost for wind generation 4 Nuclear is considered “must-run” or a “price-taker” so it will dispatch regardless of market price Based on the above table, the MP bid 2,645 MWh of generation into the day-ahead market. This is more than 2,240 MWh the SPP day-ahead required for supplying the MP load. For example, if the day-ahead market price for hour-12 is determined to be $18.00/MWh based on the generation bids received from all the SPP Market Participants. SPP will dispatch the generation with marginal cost of production at or below $18.00/MWh. Based upon the information above, SPP will dispatch the MP wind, nuclear, and large coal. The MP will still purchase 2,000 MWh from the day-ahead market to serve the load they bid into the SPP day-ahead market. All the generation that is dispatched by SPP will receive $18.00/ MWh for the output from their generation. Note that the cost of production for generation that was dispatched by SPP is, in this illustration, more than the market price of $18.00/MWh, except for wind generation. This means that the market price did not cover the cost of the MP to own the generation for other sources. If the marginal cost of production for generation is greater than the day-ahead market price, the MP purchases electricity cheaper from the day-ahead market than it would cost them to produce the electricity themselves (for Small Coal, $21.00/MWh to produce vs. $18.00/MWh to purchase). The MP generation that SPP did not dispatch, Small Coal and Combined Cycle, did not receive any revenue from the day-ahead market and incurred fixed costs during this period. Page 69 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 24 [PAGE 70] Appendix C: Example of an Unbundled Bill Page 70 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 25 [PAGE 71] Appendix D: Screenshot of powertochoose.org showing suppliers’ rate options Page 71 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 26 [PAGE 72] Appendix E: 2015 utility bundled retail sales - residential 2015 Utility Bundled Retail Sales- Residential (Data from forms EIA-861- schedules 4A & 4D and EIA-861S) Entity State Ownership Customers (Count)Sales Revenues (Thousands Average Price (Megawatthours) Dollars) (cents/kWh) Auburn Board of Public Works NE Municipal 1,904 24,543 2,229.0 9.08 Burt County Public Power Dist NE Political Subdivision 3,341 57,379 7,485.0 13.04 Butler Public Power District - (NE) NE Political Subdivision 4,603 60,903 6,778.0 11.13 Cedar-Knox Public Power Dist NE Political Subdivision 5,422 95,184 8,137.0 8.55 Cherry-Todd Electric Coop, Inc NE Cooperative 827 8,605 1,028.9 11.96 Chimney Rock Public Power Dist NE Political Subdivision 1,981 22,178 3,496.0 15.76 City of Alliance- (NE) NE Municipal 4,185 38,856 4,811.8 12.38 City of Beatrice - (NE) NE Municipal 5,782 67,896 6,458.0 9.51 City of Broken Bow - (NE) NE Municipal 1,896 22,092 2,182.6 9.88 City of Cambridge - (NE) NE Municipal 481 5,621 608.0 10.82 City of Central City NE Municipal 1,370 16,660 1,700.4 10.21 City of Crete NE Municipal 2,444 25,264 2,313.0 9.16 City of David City NE Municipal 1,207 14,264 1,658.0 11.62 City of Fairbury NE Municipal 2,672 30,922 3,235.0 10.46 City of Falls City - (NE) NE Municipal 2,135 24,033 1,959.0 8.15 City of Fremont - (NE) NE Municipal 12,345 136,546 12,646.0 9.26 City of Gering - (NE) NE Municipal 3,439 32,648 4,975.0 15.24 City of Gothenburg - (NE) NE Municipal 1,486 19,973 1,644.0 8.23 City of Grand Island - (NE) NE Municipal 21,467 213,241 20,960.0 9.83 City of Hastings - (NE) NE Municipal 10,882 108,725 10,058.1 9.25 City of Hebron - (NE) NE Municipal 743 8,756 805.0 9.19 City of Holdrege NE Municipal 2,564 28,541 2,675.4 9.37 City of Imperial NE Municipal 1,040 11,630 1,205.0 10.36 City of Kimball - (NE) NE Municipal 1,445 9,938 1,548.0 15.58 City of Lexington - (NE) NE Municipal 3,436 48,412 4,914.7 10.15 City of Madison - (NE) NE Municipal 793 9,420 897.0 9.52 City of Minden - (NE) NE Municipal 1,321 14,261 1,877.7 13.17 City of Nebraska City NE Municipal 4,759 52,445 5,692.5 10.85 City of Neligh - (NE) NE Municipal 869 9,207 961.0 10.44 City of North Platte NE Municipal 11,269 117,841 11,768.0 9.99 City of Ord - (NE) NE Municipal 1,126 15,973 1,371.0 8.58 City of Pierce - (NE) NE Municipal 999 12,057 1,050.0 8.71 City of Schuyler - (NE) NE Municipal 2,112 27,919 2,633.0 9.43 City of Seward - (NE) NE Municipal 2,788 28,494 3,312.0 11.62 City of Sidney - (NE) NE Municipal 4,065 29,988 3,692.0 12.31 City of South Sioux City NE Municipal 4,686 68,516 6,931.0 10.12 City of St Paul - (NE) NE Municipal 954 11,112 1,152.0 10.37 City of Superior - (NE) NE Municipal 1,023 9,608 1,047.0 10.90 City of Syracuse - (NE) NE Municipal 1,071 8,802 983.0 11.17 City of Tecumseh NE Municipal 809 7,920 954.3 12.05 City of Valentine - (NE) NE Municipal 1,422 22,017 1,939.7 8.81 City of Wahoo - (NE) NE Municipal 1,878 21,928 1,897.0 8.65 City of Wakefield - (NE) NE Municipal 566 4,676 507.4 10.85 City of Wayne NE Municipal 2,019 17,951 1,989.0 11.08 City of West Point - (NE) NE Municipal 1,490 14,430 1,677.0 11.62 Cornhusker Public Power Dist NE Political Subdivision 7,054 122,722 13,558.0 11.05 Cozad Board of Public Works NE Municipal 1,708 20,404 2,140.1 10.49 Cuming County Public Pwr Dist NE Political Subdivision 2,791 48,443 4,817.8 9.95 Custer Public Power District NE Political Subdivision 4,598 72,438 8,320.0 11.49 Dawson Power District NE Political Subdivision 15,642 237,391 24,392.0 10.28 Elkhorn Rural Public Pwr Dist NE Political Subdivision 5,917 103,210 10,150.0 9.83 High West Energy, Inc NE Cooperative 1,778 17,815 2,274.0 12.76 Highline Electric Assn NE Cooperative 751 8,162 1,009.3 12.37 Howard Greeley Rural P P D NE Political Subdivision 3,218 52,850 5,685.0 10.76 KBR Rural Public Power District NE Political Subdivision 3,345 35,811 4,765.0 13.31 LaCreek Electric Assn, Inc NE Cooperative 168 2,263 242.0 10.69 Lincoln Electric System NE Municipal 117,859 1,168,564 110,421.3 9.45 Loup River Public Power Dist NE Political Subdivision 14,993 227,342 22,541.0 9.92 Loup Valleys Rural P P D NE Political Subdivision 2,854 39,334 4,442.0 11.29 McCook Public Power District NE Political Subdivision 3,734 37,445 4,839.6 12.92 Midwest Electric Member Corp NE Cooperative 3,195 33,805 3,865.3 11.43 Nebraska Public Power District NE Political Subdivision 70,318 793,831 84,858.0 10.69 Niobrara Valley El Member Corp NE Cooperative 4,786 49,709 5,804.0 11.68 Norris Public Power District NE Political Subdivision 12,920 240,805 22,917.1 9.52 North Central Public Pwr Dist NE Political Subdivision 3,504 40,981 4,830.5 11.79 Northeast Nebraska P P D NE Political Subdivision 6,713 114,287 11,554.0 10.11 Northwest Rural Pub Pwr Dist NE Political Subdivision 1,439 20,529 3,038.6 14.80 Omaha Public Power District NE Political Subdivision 319,501 3,452,484 382,260.0 11.07 Panhandle Rural El Member Assn NE Cooperative 1,766 29,749 3,788.0 12.73 Perennial Public Power Dist NE Political Subdivision 3,587 64,402 6,303.0 9.79 Polk County Rural Pub Pwr Dist NE Political Subdivision 2,859 41,046 4,694.5 11.44 Roosevelt Public Power Dist NE Political Subdivision 2,081 29,726 3,509.0 11.80 Seward County Rrl Pub Pwr Dist NE Political Subdivision 3,152 56,679 5,988.0 10.56 South Central Public Pwr Dist NE Political Subdivision 3,802 62,198 5,793.5 9.31 Southern Public Power District NE Political Subdivision 15,045 233,136 23,455.9 10.06 Southwest Public Power Dist NE Political Subdivision 2,247 34,644 3,492.0 10.08 Stanton County Public Pwr Dist NE Political Subdivision 1,788 28,177 3,174.0 11.26 Twin Valleys Public Power Dist NE Political Subdivision 4,106 36,693 4,338.0 11.82 Wheat Belt Public Power Dist NE Political Subdivision 3,235 33,907 4,307.8 12.70 Wyrulec Company NE Cooperative 269 2,722 407.0 14.95 Adjustment 2015 NE Other 28,101 301,053 34,709.1 Page 72 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 27 [PAGE 73] Appendix F: 2015 utility bundled retail sales - Industrial 2015 Utility Bundled Retail Sales- Industrial (Data from forms EIA-861- schedules 4A & 4D and EIA-861S) Sales Revenues (Thousands Average Price Entity State Ownership Customers (Count) (Megawatthours) Dollars) (cents/kWh) Auburn Board of Public Works NE Municipal 1 2,904 262.8 9.05 Burt County Public Power Dist NE Political Subdivision 685 22,750 3,413.0 15.00 Butler Public Power District - (NE) NE Political Subdivision 666 8,921 2,553.0 28.62 Cedar-Knox Public Power Dist NE Political Subdivision 1,198 24,805 3,774.0 15.21 Cherry-Todd Electric Coop, Inc NE Cooperative 226 16,566 2,032.1 12.27 Chimney Rock Public Power Dist NE Political Subdivision 928 18,039 2,361.0 13.09 City of Alliance- (NE) NE Municipal 12 29,093 2,868.4 9.86 City of Beatrice - (NE) NE Municipal 119 69,163 5,325.0 7.70 City of Broken Bow - (NE) NE Municipal 8 52,275 3,738.8 7.15 City of Cambridge - (NE) NE Municipal 1 33,788 2,059.0 6.09 City of Central City NE Municipal 11 5,851 609.0 10.41 City of Crete NE Municipal 3 63,323 4,062.0 6.41 City of David City NE Municipal 30 18,179 1,871.0 10.29 City of Fairbury NE Municipal 18 31,762 2,465.0 7.76 City of Falls City - (NE) NE Municipal 7 4,278 298.0 6.97 City of Fremont - (NE) NE Municipal 530 230,816 16,910.0 7.33 City of Gering - (NE) NE Municipal 40 18,185 2,085.0 11.47 City of Gothenburg - (NE) NE Municipal 15 22,654 1,889.0 8.34 City of Grand Island - (NE) NE Municipal 99 317,928 23,554.0 7.41 City of Hastings - (NE) NE Municipal 128 180,698 11,145.5 6.17 City of Holdrege NE Municipal 2 54,208 2,625.2 4.84 City of Imperial NE Municipal 45 4,321 357.0 8.26 City of Lexington - (NE) NE Municipal 5 115,517 7,792.3 6.75 City of Madison - (NE) NE Municipal 1 45,108 3,010.0 6.67 City of Nebraska City NE Municipal 34 69,297 5,922.0 8.55 City of North Platte NE Municipal 4 38,521 2,664.0 6.92 City of Pierce - (NE) NE Municipal 28 609 36.0 5.91 City of Schuyler - (NE) NE Municipal 127 97,418 7,295.0 7.49 City of Seward - (NE) NE Municipal 5 29,559 2,460.0 8.32 City of Sidney - (NE) NE Municipal 67 36,138 2,793.0 7.73 City of St Paul - (NE) NE Municipal 32 8,908 802.0 9.00 City of Superior - (NE) NE Municipal 15 6,017 560.0 9.31 City of Syracuse - (NE) NE Municipal 19 5,798 454.0 7.83 City of Tecumseh NE Municipal 5 7,485 643.8 8.60 City of Wahoo - (NE) NE Municipal 4 12,533 935.0 7.46 City of Wakefield - (NE) NE Municipal 1 36,630 2,556.0 6.98 City of West Point - (NE) NE Municipal 80 31,330 2,947.0 9.41 Cornhusker Public Power Dist NE Political Subdivision 2,287 152,835 14,106.0 9.23 Cozad Board of Public Works NE Municipal 1 4,301 371.8 8.64 Cuming County Public Pwr Dist NE Political Subdivision 326 14,653 1,688.4 11.52 Custer Public Power District NE Political Subdivision 4,911 98,225 13,236.0 13.48 Dawson Power District NE Political Subdivision 5,795 241,846 27,821.0 11.50 Elkhorn Rural Public Pwr Dist NE Political Subdivision 2,807 109,716 12,773.0 11.64 High West Energy, Inc NE Cooperative 1,196 71,167 8,048.0 11.31 Highline Electric Assn NE Cooperative 1,084 63,788 8,138.7 12.76 Howard Greeley Rural P P D NE Political Subdivision 1,445 39,213 4,140.0 10.56 KBR Rural Public Power District NE Political Subdivision 779 34,562 5,631.0 16.29 LaCreek Electric Assn, Inc NE Cooperative 46 2,432 277.0 11.39 Lincoln Electric System NE Municipal 184 487,115 32,121.3 6.59 Loup River Public Power Dist NE Political Subdivision 53 662,298 42,513.0 6.42 Loup Valleys Rural P P D NE Political Subdivision 2,245 72,081 7,113.0 9.87 McCook Public Power District NE Political Subdivision 910 101,832 8,620.5 8.47 Midwest Electric Member Corp NE Cooperative 2,058 141,936 17,330.1 12.21 Nebraska Public Power District NE Political Subdivision 56 1,170,406 66,056.0 5.64 Niobrara Valley El Member Corp NE Cooperative 1,203 64,229 7,544.0 11.75 Norris Public Power District NE Political Subdivision 1,869 460,966 33,847.5 7.34 North Central Public Pwr Dist NE Political Subdivision 1,109 38,128 5,903.1 15.48 Northeast Nebraska P P D NE Political Subdivision 673 12,689 2,341.0 18.45 Northwest Rural Pub Pwr Dist NE Political Subdivision 652 45,414 5,843.0 12.87 Omaha Public Power District NE Political Subdivision 174 3,299,315 201,969.0 6.12 Panhandle Rural El Member Assn NE Cooperative 847 36,869 6,048.0 16.40 Perennial Public Power Dist NE Political Subdivision 2,709 194,047 16,590.0 8.55 Polk County Rural Pub Pwr Dist NE Political Subdivision 1,289 21,702 4,335.4 19.98 Roosevelt Public Power Dist NE Political Subdivision 684 18,498 2,246.0 12.14 Seward County Rrl Pub Pwr Dist NE Political Subdivision 757 9,933 1,863.0 18.76 South Central Public Pwr Dist NE Political Subdivision 3,129 74,072 8,547.8 11.54 Southern Public Power District NE Political Subdivision 9,359 767,508 64,605.8 8.42 Southwest Public Power Dist NE Political Subdivision 1,280 116,678 12,314.0 10.55 Stanton County Public Pwr Dist NE Political Subdivision 594 93,517 7,461.0 7.98 Twin Valleys Public Power Dist NE Political Subdivision 1,246 27,471 4,768.0 17.36 WAPA-- Western Area Power Administration NE Federal 1 3,982 32.0 0.80 Wheat Belt Public Power Dist NE Political Subdivision 1,014 87,579 10,170.7 11.61 Wyrulec Company NE Cooperative 164 4,070 616.4 15.14 Y-W Electric Assn Inc NE Cooperative 72 6,131 774.0 12.62 Adjustment 2015 NE Other 349 32,528 3,888.0 Page 73 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 28 [PAGE 74] Appendix G: Researchers’ Biographies Ernie Goss is the Jack MacAllister Chair in Regional Jeffrey Milewski is a senior research economist Economics at Creighton University and is the initial at Goss & Associates. He received his master’s director for Creighton’s Institute for Economic degree in political economy from the London Inquiry. He is also principal of the Goss Institute in School of Economics and Political Science in Denver, Colo. Goss received his Ph.D. in economics 2013. He completed his bachelor’s degree at from The University of Tennessee in 1983 and is a Creighton University in 2007, having studied former faculty research fellow at NASA’s Marshall economics and finance. Milewski also has Space Flight Center. He was a visiting scholar with experience working in finance and as an the Congressional Budget Office for 2003-2004, and entrepreneur. Recently, he has co-authored impact has testified before the U.S. Congress, the Kansas studies on a range of topics such as property- Legislature, and the Nebraska Legislature. In the fall casualty insurance, highway expansion, cost/ of 2005, the Nebraska Attorney General appointed benefit analysis, and national sporting events. Goss to head a task force examining gasoline pricing in the state. He has published more than 100 research studies focusing primarily on economic forecasting and on the statistical analysis of business and economic data. His book Changing Attitudes Toward Economic Reform During the Yeltsin Era was published by Praeger Press in 2003, and his book Governing Fortune: Casino Gambling in America was published by the University of Michigan Press in March 2007. He is editor of Economic Trends, an economics newsletter published monthly with more than 11,000 subscribers, produces a monthly business conditions index for the nine-state Mid-American region, and conducts a survey of bank CEOs in 10 U.S. states. Survey and index results are cited each month in approximately 100 newspapers; citations have included the New York Times, Wall Street Journal, Investors Business Daily, The Christian Science Monitor, Chicago Sun Times, and other national and regional newspapers and magazines. Each month 75-100 radio stations carry his Regional Economic Report. Page 74 Agenda Item #7b NEBRASKA PUBLIC POWER’S COMPETITIVENESS IN THE REGIONAL ENERGY MARKET Page 29 [PAGE 75] Energy Rate, Residential Only (cents/kWh) State 2004 2015 % Change Retail Choice Avg 15.27 Washington 6 .37 9 .09 43% % to Retail -31% Louisiana 8 .05 9 .33 16% % to US Average -16% Lincoln Electric System 6 .18 9 .39 52% Nebraska Rank 10 North Dakota 6 .79 9 .62 42% Arkansas 7 .36 9 .82 33% LES % to Retail* -39% Idaho 6 .10 9 .93 63% LES % to US Average* -26% West Virginia 6 .23 10.08 62% Oklahoma 7 .72 10.14 31% Kentucky 6 .11 10.24 68% Tennessee 6 .90 10.30 49% Nebraska 6 .96 10.60 52% Oregon 7 .18 10.66 48% Montana 7 .86 10.88 38% Utah 7 .21 10.88 51% Wyoming 7 .21 10.97 52% South Dakota 7 .65 11.08 45% Missouri 6 .97 11.21 61% Mississippi 8 .21 11.27 37% North Carolina 8 .45 11.28 33% Virginia 7 .99 11.37 42% Georgia 7 .86 11.54 47% Texas 9 .73 11.56 19% Indiana 7 .30 11.57 58% Florida 8 .99 11.58 29% Iowa 8 .96 11.63 30% Alabama 7 .62 11.70 54% Colorado 8 .42 12.12 44% Minnesota 7 .92 12.12 53% Arizona 8 .46 12.13 43% Kansas 7 .74 12.34 59% New Mexico 8 .67 12.47 44% Illinois 8 .37 12.50 49% South Carolina 8 .12 12.57 55% US Average 8 .95 12.65 41% Nevada 9 .69 12.76 32% Ohio 8 .45 12.80 51% District of Columbia 8 .00 12.99 62% Delaware 8 .78 13.42 53% Pennsylvania 9 .58 13.64 42% Maryland 7 .80 13.82 77% Wisconsin 9 .07 14.11 56% Michigan 8 .33 14.42 73% Maine 12.16 15.61 28% New Jersey 11.23 15.81 41% California 12.20 16.99 39% Vermont 12.94 17.09 32% New Hampshire 12.49 18.50 48% New York 14.54 18.54 28% Rhode Island 12.19 19.29 58% Alaska 12.44 19.83 59% Massachusetts 11.75 19.83 69% Connecticut 11.63 20.94 80% Hawaii 18.06 29.60 64% Source: U.S. Department of Energy - Energy Information Administration; Average Retail Price of Electricity *LES rate is calculated as the total revenue divided by total energy sold, averaged over 12 months from EIA 826 data for 2004 and 2015 Page 75 Agenda Item #7b [PAGE 76] Energy Rate, All Customer Classes (cents/kWh) State 2004 2015 % Change Retail Choice Avg 12.67 Washington 5 .80 7 .40 28% % to Retail -30% Louisiana 7 .13 7 .65 7% % to US Average -14.41% Oklahoma 6 .50 7 .90 22% Nebraska Rank 15 Wyoming 4 .98 7 .97 60% Lincoln Electric System 5 .16 8 .02 55% LES % to Retail* -37% Idaho 4 .97 8 .09 63% LES % to US Average* -23% West Virginia 5 .13 8 .11 58% Kentucky 4 .63 8 .14 76% Arkansas 5 .67 8 .19 44% Iowa 6 .40 8 .35 30% Utah 5 .69 8 .54 50% Texas 7 .95 8 .70 9% North Dakota 5 .69 8 .75 54% Oregon 6 .21 8 .75 41% Montana 6 .40 8 .90 39% Nebraska 5 .70 8 .91 56% Indiana 5 .58 8 .99 61% Tennessee 6 .14 9 .30 51% Virginia 6 .43 9 .31 45% Alabama 6 .08 9 .33 53% North Carolina 6 .97 9 .37 34% Illinois 6 .80 9 .40 38% Missouri 6 .07 9 .44 56% South Dakota 6 .44 9 .47 47% Nevada 8 .56 9 .48 11% Minnesota 6 .24 9 .53 53% Mississippi 7 .00 9 .53 36% South Carolina 6 .22 9 .58 54% Georgia 6 .58 9 .62 46% New Mexico 7 .10 9 .62 35% Colorado 6 .95 9 .94 43% Ohio 6 .89 9 .98 45% Kansas 6 .37 10.14 59% Pennsylvania 8 .00 10.31 29% Arizona 7 .45 10.34 39% US Average 7 .61 10.41 37% Florida 8 .16 10.49 29% Wisconsin 6 .88 10.73 56% Michigan 6 .94 10.76 55% Delaware 7 .53 11.17 48% District Of Columbia 7 .47 12.07 62% Maryland 7 .15 12.07 69% Maine 9 .69 12.78 32% New Jersey 10.29 13.74 34% Vermont 11.02 14.41 31% New York 12.55 15.28 22% California 11.35 15.42 36% New Hampshire 11.37 16.02 41% Massachusetts 10.77 16.90 57% Rhode Island 10.96 17.01 55% Alaska 10.99 17.59 60% Connecticut 10.26 17.77 73% Hawaii 15.70 26.17 67% Source: U.S. Department of Energy - Energy Information Administration; Average Retail Price of Electricity *LES rate is calculated as the total revenue divided by total energy sold, averaged over 12 months from EIA 826 data for 2004 and 2015 Page 76 Agenda Item #7b