2003 AGN MAY 06 I17 - Laserfiche WebLink

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CITY OF COLTON Item #17 AGENDA REPORT For City Council Meeting of May 06,2003 TO: Honorable Mayor and Council Members FROM: Thomas K. Clarke, Electric Utility Director—tle--- SUBJECT: Gas transportation agreements with Southern California Gas Company DATE: April 29, 2003 On October 15, 2002, the Council approved the Operating and Maintenance Agreement and the Administrative Services Agreement between the City and El Colton, LLC for the Agua Mansa Power Plant (AMPP). As part of the agreements, all goods and services required for the operation of the plant are to be between the City of Colton and the third party supplier. DISCUSSION/ANALYSIS The construction of the Agua Mansa Power Plant is on schedule; first fire on the gas turbine generator is scheduled for May 7, 2003. In order to perform first fire, Southern California Gas requires that the following transportation agreements be approved before any natural gas transportation service can be provided to the power plant. These are the basic terms and conditions of the agreements Term: The term of the agreement is for 2 years. Price: The charge for transportation is based on volume of gas delivered, and follows Southern California Gas' Schedule No. GT -F, Finn Intrastate Transmission Service. The City will also have to install an electronic meter reading device at the site, which is estimated between $2,000 and $10,000. ALTERNATIVES Take no action at this time, which would negatively impact the start-up of the power plant FINANCIAL IMPACT Fuel transportation is included in both the AMPP pre -commencement budget and the AMPP operating budget for fiscal year 2003-2004. The AMPP pre -commencement budget was approved by council on March 18, 2003. The AMPP operating budget will be presented to council as part of the City's budget process in May 2003. Sufficient funds are available this fiscal year to cover the costs of fuel transportation. Page I of 2 (w/attachments)