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PUBLIC POWER AGENCY MEETING MINUTES
February 28, 2007
Members Present: John Montone, Chairperson, Timothy C. Lattimore, William Graney, Mike Luksa, Luke Rybarczyk and Krste Biljanoski
Members Absent: Robert M. Buschman, Vijay Mital (called in Florida)
Staff Present: Andy Fusco, City Attorney, Michael Long and Anthony DeCaro
One vacant position
Meeting of the Public Power Agency of February 28, 2007 was called to order by Chairperson John Montone at 4:35 p.m. Motion made by Bill Graney to accept minutes of the January 24, 2007 meeting and seconded by Luke Rybarczyk.
John Montone introduced Philip Van Horne, President of Blue Rock Energy, Inc. who gave a presentation on his company. Stated he was a former NYMO employee for 15 years and dealt with municipalities. Has a total of 8 employees with strong management with over 70+ years of combined energy expertise. The company is a premier provider of energy commodity solutions to commercial and industrial customers across the northeast. Headquarters are in Syracuse and has a diversified supply portfolio. Blue Rock energy customers are both small businesses and well as large institutional, municipal and industrial. Blue Rock will work with the City to find out how many accounts the City has, will need to obtain the load data, will perform an energy analysis of load data, determine the risk tolerance and
head requirements, evaluate load curtailment potential and establish report needs such as custom reports, analysis, etc. Blue Rock has all the necessary licenses to be authorized to sell electric and gas, has registered with FERC, has the software. Blue Rock also is looking into green energy, wind, biomass, etc. Blue Rock would be the ESCO and the City would be the aggregator. They would go out to bid and get the best gas prices for the City. The company has the structure in place to do this. There was a question and answer period after the presentation.
Discussion held on OCM-BOCES contract for energy purchasing service. John asked Andy Fusco to review the contract, make a decision on the aggregation and put it on the agenda for the next meeting and get an RFP done.
Next item on agenda is natural gas. It was asked if we could get out of the contract and Andy Fusco said it was clear that the City Council adopted this contract, for a period of 5 years for electricity and two years for gas beginning on May 1, 2005. Problem is there are two commodities in one contract and two different time periods and not a whole lot of specificity in this contract. Chair passed out copy of gas sales agreement and a memorandum from Jeff Genzer who made comments back in 2004 we have the Mill Street, we have the N. Division Street where we get the natural gas from, look at the natural gas one first Industrial Natural Gas Sales Agreement. There is a natural gas pipeline at the landfill site and an easement was given to cross that area. The City can go down and tap into
that pipe and get that natural gas eliminating delivered prices. Never took advantage of it, laid dormant, changed companies 5 times, Chesapeake is the name of the company we need to get that information to them. Nancy Hussey said she filed a default on the situation. Need to investigate, we want these people to provide us the gas at the wellhead price and if we can do that we can blend that rate into the digester project that we are going to be doing. We have been told that there is no volume, the pipe is not big enough to handle, in the natural gas agreement it talks about those things and Jeff Genzer did make some remarks. If they don’t do what the agreement says, they have to get it off the land. We want to use that pipeline. They are not doing what the agreement says. If we say we want this natural gas for this generator in the agreement they are going to have to provide it. It is a pipeline that we can utilize in
this system and for the City for the digester project and possibly take gas out of there and sell it. We should have a conference call with Jeff Genzer and go through the whole process.
Next discussion was held on the update of the hydro sites. Tony DeCaro spoke about the N. Division Hydro replaced the resister, transformer is having winding rebuilt and will take 16 weeks and entered into agreement with Salomon in Kansas to buy three transformer for use on temporary basis and should be here by Friday. All equipment is in, meetings set up with NYSEG to coordinate all the activity, KayR has been working all week. If all equipment is delivered as promised we can be up and running on that site by the middle or end of next week. Mike Luksa asked about the rate and Tony stated that we have a pre-existing contract, a couple of more years at 8.4 cents. We were getting a reeling rate for Mill St. Dennis Zack and Krste Biljanoski looked at Mill Street and Dennis said
he checked the original equipment, got approximate price what it would cost to check the gearbox and it would be about $3,000 for field inspection. The turbine around $2,500, rough estimate on the generator probably another $1,500 to find out the situation on the generator. Auburn Armature quoted about $20,000 for the rewind, looked into a little closer probably could be done for $15,000. Good chance it is still good and won’t know until it is tested, probably $7,000 in mechanics. Krste stated here we have electrical and mechanical and we don’t know what is the problem. We need to start with the mechanical because the free wheel keeps running, best place to start, if that is the problem and rest is ok we won’t need to go as far. John stated we have determined why it has been shut down, not running, this agency needs to make a recommendation to the City Council to get some funding or move forward a request to have someone knowledgeable
go down and give us a true cost. Dennis asked if we can approach the NYPA for $10,000 for feasibility, it has been running for 25 years, if you put it back on the line for the duration and do it right. John stated we can approach the NYPA and they will fix the whole thing. John asked for a motion to ask the City Council to make contract to see what it would cost to get this fixed. Motion made by Krste Biljanoski and seconded by Mike Luksa.
John stated we are missing out on the green power credits that we never got from these hydro sites, we should be accumulating those and collecting those, that will pay $10,000 or $20,000. They are saleable credits; Power Agency is going to give me some names, basically a broker that will sell these hydropower credits. We can do this with the every hydro site, including the digester any of these projects that are considered green power we will be getting credits.
John Montone, the Mayor and Mike Long went to Albany to NYSERDA last week looking for grant money first of all the City has approved the recommendation from us Phase I of the digester process which is in milestones, 6 or 7, to cover the first part, the accumulation of methane gas, up grading some of the piping, going to do permitting for us, looking into investigation of where to put sludge how we can do it maybe with a line process, on and on. Mike Long stated that John was talking about the $1 million dollar grant that we received, it was a good meeting, everyone agreed with the logic, Power Authority will put up the other $2 or $3 million to build this and let’s get going. They want to make it bigger. John said this agency needs to make a decision once we know how much electricity we can
generate and the gas coming out of there, we are going to give it to the people at Tech Park, McQuay and the others down there to help lower or take it all, make it island, won’t be the only power situation down there, needs to be connected to the grid or do we want to sell on the open market instead of offering it the people in the community overall. Need to take a hard look, once we start generating power we will be dealing with the Public Service Commission depending on our rate structures and what we do with it. We have said this before to use it as a economic development situation, we need to get with the Planning Department, we will know after the engineering is done to say we are going to have 2 or 5 mega watts of power to offer a company that would locate down there. Those are the decisions this agency needs to make and bring to City Council. We can join the Municipal Utility Association and with that we can open the door to some of the
preference power. Going to create a great source of revenue for the City.
John stated that the committee should make a recommendation to the Planning Department to work with the existing industry at Tech Park and to put something out there whom ever you are contacting telling them that the energy is going to be available.
John stated that Senator Valesky is going to be at the County Water & Soil it has to do with the digester, if you want to come out he will be talking about the digester project on March 9, 2007 at 10:00 a.m.
John stated that we need to replace Mr. Buschman and Frank’s position so we can get back to full members.
Next meeting is scheduled for Wednesday, March 14, 2007 at 4:00 p.m. in the third floor training room. Motion to adjourn by Mike Luksa and seconded by Luke Rybarczyk. Meeting adjourned at 6:15 p.m.
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