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CITY OF GLENDALE, CALIFORNIA
REPORT TO THE CITY COUNCIL
AGENDA ITEM
Report: Glendale Water and Power (GWP) Continued Software Subscription to Energy Trading Platforms, Open Access Technology International, Inc. (OATI), and Intercontinental Exchange, Inc. (ICE).
1. Motion authorizing the City Manager, or his designee, to execute an agreement for continued subscription to Open Access Technology International, Inc. (OATI) services pursuant to Contract No. C103486B for a total not-to-exceed amount of $325,000 for the five-year period through Fiscal Year 2028-2029.
2. Motion authorizing continued subscription to Intercontinental Exchange, Inc. (ICE), pursuant to Contract No. 8000558 for a total not-to-exceed amount of $283,000 for the five-year period, through Fiscal Year 2028-2029, and authorizing the City Manager, or his designee, to execute any necessary documents for said continued subscription.
COUNCIL ACTION
Item Type: Consent Calendar
Approved for April 30, 2024 calendar
EXECUTIVE SUMMARY
To efficiently fulfill the objectives of the GWP Energy Risk Management Policy and the GWP Trading Authority Policy, GWP Power Management Section relies on industry tools, such as OATI and ICE, that are essential to capture the dynamic nature of the daily operation.
OATI software platform is an integral part of Power Management’s daily operational tasks including, but not limited to the scheduling of power and tracking of power sources. ICE, a web-based platform, is utilized for the transparent and efficient procurement of physical and financial commodities.
Both, OATI and ICE, previously approved agreements are due to expire on June 30, 2024. Therefore, staff is seeking City Council approval for a five-year extension to continue with OATI and ICE Services.
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RECOMMENDATION
Authorize the City Manager, or his designee, to execute the extension of agreements for continued use of OATI and ICE service, for a five-year period beginning July 1, 2024, through June 30, 2029.
ANALYSIS
Open Access Technology International (OATI)
Open Access Technology International, or OATI, provides software platforms integral to the operational tasks of GWP. E-Tags, or electronic tags, are critical to GWP Power Management's daily and after-the-fact operations. They capture not only the physical flow of energy, but also the associated environmental attributes that are fundamental in demonstrating compliance with the State's Renewable Portfolio Standards (RPS) and Cap and Trade Programs. The California Air Resource Board (CARB) has the authority to collect data on e-tags from OATI to facilitate CARB's verification of power imported into California under the Greenhouse Gas (GHG) Mandatory Reporting Requirement (MRR).
Under the existing agreement with OATI, GWP's Power Management Section subscribes to multiple OATI online services, including:
•webSmartTag-Tag Agent Service to generate, submit, and approve North American Electric Reliability Corporation (NERC) e-Tags to comply with NERC Interchange Scheduling and Coordination reliability standards; •webRegistry, to access and update Glendale's transmission path registry information;
•webTrans, for processing transmission reservations on OATI's Open Access Same-Time Information System (OASIS);
•webScheduler, to facilitate trading control, check-out and settlement activities; •e-Tag Reporting Service, to download tag details to facilitate reconciliation and verification of Renewable Energy Credit (REC) transfers in the Western Renewable Energy Generation Information System (WREGIS); and •webCarb, to facilitate compliance to CARB’s annual GHG MRR.
The previously approved agreement is valid through June 30, 2024. Staff recommends an extension for continued use of OATI’s services for a five-year period through Fiscal Year 2028-2029, for a total not-to-exceed amount of $325,000.
Intercontinental Exchange (ICE)
Intercontinental Exchange, or ICE, is an internet-based trading platform used for the transparent and efficient procurement of energy commodities.
GWP Power Management has subscribed to ICE services for trading electricity, natural gas, and environmental commodities. Energy commodities are inherently volatile and access to real-time prices and trading activities in the marketplace is fundamental in 3{{section.number}}e
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ensuring the City of Glendale is supplied with power, efficiently and economically. ICE provides valuable data on commodity pricing which is a crucial tool in the Day Ahead and Term operations of the Power Management group.
GWP has been utilizing ICE services under an evergreen contract that will continue in effect unless terminated upon 30-day termination notice. This contract does not require amendments for extension, but it necessitates approval and allocation of funds for continued use. The previously approved authorization is good through June 30, 2024.
Staff recommends adding funds to the existing agreements for continued use of ICE trading platform through Fiscal Year 2028-2029, for a total not-to-exceed amount of $283,000.
The extension of authorization to use ICE is crucial for meeting the evolving needs our organization. It allows GWP to continuously access ICE data and trade the following commodities on the ICE platform:
•Physical Power,
•Financial Power,
•Physical Gas,
•Financial Gas, and
•Environmental attributes.
STAKEHOLDERS/OUTREACH
Non-applicable
FISCAL IMPACT
The total not-to-exceed cost to provide software platforms including, but not limited to, the scheduling of power and tracking of power sources with OATI for the five-year period is $325,000. The anticipated cost for the first year of the agreement, beginning July 1, 2024 is $65,000.
The total not-to-exceed cost to utilize the internet-based platform ICE for the five-year period is $283,000. The anticipated cost for the first year of the agreement, beginning July 1, 2024 is $56,600.
Funding associated with the first year of contract for both agreements is requested in the Power Management’s proposed budget for Fiscal Year 2024-25, per table below:
Existing Appropriation
Amount Account String Funding Source
$121,600 GL: 43110-5820-GWP-4680-P0000-T0000-
F1500
Electric Works Revenue
Fund
Funds for future years of the agreements will be requested through the annual budgetary process.
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ENVIRONMENTAL REVIEW (CEQA/NEPA)
Not Applicable. The action herein is not a project as defined under the California Environmental Quality Act (CEQA) and as such not subject to CEQA.
CAMPAIGN DISCLOSURE
In accordance with the City Campaign Finance Ordinance No. 5744, the following are the names and business addresses of the members of the board of directors, the chairperson, CEO, COO, CFO, Subcontractors and any person or entity with more than ten percent interest in the company proposed for contract in this agenda Item report:
Officers of Open Access Technology Inc. (OATI):
Full Name Title Business Address City State Zip
Sasan
Mokhtari
President and
CEO
7901 Computer
Avenue
Bloomington MN 55435
Mary Brown Senior
Executive Vice
President and
Legal Counsel
7901 Computer
Avenue
Bloomington MN 55435
Board of Directors of Open Access Technology Inc. (OATI):
Full Name Title Business Address City State Zip
None.
Officers of Intercontinental Exchange (ICE):
Full Name Title Business Address City State Zip
Jeffrey
Sprecher
Chairman and
Chief
Executive
Officer, ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Benjamin
Jackson
President, ICE 5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Warren
Gardiner
Chief Financial
Officer, ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Lynn Martin President,
NYSE Group &
Chair, ICE
Fixed Income
& Data
Services
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
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Christopher
Edmonds
President,
Fixed Income
& Data
Services, ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Trabue Bland Sr. Vice
President,
Futures
Exchanges,
ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Timothy J.
Bowler
President, ICE
Mortgage
Technology
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Douglas
Foley
Sr. Vice
President, HR
Administration,
ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Jennifer IlKiw President, ICE
Futures US
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Stanislav
Ivanov
President, ICE
Clear Credit
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Mayur
Kapani
Chief
Technology
Officer, ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Elizabeth
King
Global Head of
Clearing &
Chief
Regulatory
Officer, ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Kevin
McClear
President, ICE
Clear U.S.
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Joe Nackashi Vice Chair,
ICE Mortgage
Technology
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Brookly
McLaughlin
Vice President,
Corporate
Affairs &
Sustainability,
ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Christopher
Rhodes
President, ICE
Futures
Europe
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Joanne
Rowe
Corporate Risk
Officer, ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Hester
Serafini
President, ICE
Clear Europe
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
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Octavia
Spencer
Vice President,
Associate
General
Counsel &
Corporate
Secretary, ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Andrew
Surdykowski
General
Counsel, ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
David
Underwood
Chief Audit
Executive, ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Stuart
Williams
Chief
Operating
Officer, ICE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Board of Directors of Intercontinental Exchange (ICE):
Full Name Title Business Address City State Zip
Jeffrey
Sprecher
Chairman and
CEO, ICE;
Chairman,
NYSE
5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Hon. Sharon
Bowen
Director 5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Shantella
Cooper
Director 5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Duriya
Farooqui
Director 5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
The Rt. Hon.
the Lord
Hague of
Richmond
Director 5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Mark
Mulhern
Director 5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Thomas
Noonan
Director 5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Caroline
Silver
Director 5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Judith
Sprieser
Director 5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
Marti
Tirinnanzi
Director 5660 New Northside
Drive NW, 3rd Floor
Atlanta GA 30328
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ALTERNATIVES TO STAFF RECOMMENDATION
Alternative 1: Decline to approve extension of agreements for continued use of OATI and ICE Services for a five-year period through Fiscal Year 2028-2029.
Not approving these agreements will put Glendale at a disadvantage and prevent the ability to efficiently procure electric power and gas commodities and services, and meet its State-mandated renewable portfolio and greenhouse gas reduction targets because of the markets in which energy, gas and environmental transactions occur. Furthermore, these industry standard tools provide essential mechanism for accountability and risk management which is consistent with the intent and the objectives of the GWP Energy Risk Management Policy and the GWP Trading Authority Policy.
Alternative 2: Consider any other alternative not proposed by staff.
ADMINISTRATIVE ACTION
Submitted by:
Mark Young, General Manager - Glendale Water and Power
Prepared by:
Scott K. Mellon, Assistant General Manager - Power Management Chie Valdez, Integrated Resource Planning Administrator Approved by:
Roubik R. Golanian, P.E., City Manager
EXHIBITS/ATTACHMENTS
None.