1997 AGN JUL 01 I14 - Laserfiche WebLink

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JUN -23-1997 11:16 P.02 Agreement (IOA) with SCE, which allowed Cities to procure both short term and long term resources to serve their retail loads. Since the IOA requires Cities to provide SCE three year notice to Procure and receive the full economic benefits of such resources, the Cities have to a great degree procured long term power resources to meet their needs. However, Cities entered into a settlement agreement with SCE in 1996, which substantially reduced the notice period to SCE, Cities have switched to a short term procurement strategy of no longer than oneear. y . Due to the long term procurement strategy employed by Cities in the early to rrrid 1990's, Cities have procured certain resources at prices substantially above market price going into the competitive environment, i.e., Cities have incurred the so called "stranded costs". The mitigation Of the generation stranded costs will be a or challenge a to the Cities in the next five � g years to ensure Cities' long term competitiveness. 4.2 Resources and Load Balancing 4.2.1 Current Supply_Side Resources 4.2-1.1 Palo Verde Nuclear Generating Station In 1981, Cities, in conjunction with other municipalities in southern California, entered into a 45 -year contract with the Southern California Public Power Authority (SCPPA) to purchase power generated from the Palo Verde Nuclear Genesting Station (PVNGS) in the State of Arizona. Each Cities' power purchase contract entitlement to PVNGS is 2.25 MW of capacity Delivery of this resource began in April 1986 and will continue until the year 2030. 4.2.1.2 Hoover Uprating Project In 1987, each of Cities entered into an agreement for the purchase Of firm capacity and energy from western. This resource becarne available as a result of U.S. Bureau of Reclamation project replacing the turbines and generators at Hoover Dam with more [El