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CITY OF GLENDALE, CALIFORNIA
REPORT TO THE CITY COUNCIL
AGENDA ITEM
Report: Amendment No. 3 to Professional Services Agreement with Allegro Development Corporation.
1. Motion authorizing the City Manager, or his designee, to execute Amendment No. 3 to the Professional Services Agreement (Contract No.
C105576) with Allegro Development Corporation, a member of ION Group, to provide additional funding for Software License and Service Agreement for maintenance and support services for the Allegro Energy Trading and Risk Management (ETRM) System in the amount of $265,000, increasing the total not-to-exceed amount to $3,383,204.
COUNCIL ACTION
Item Type: Consent Calendar
Approved for May 5, 2026 calendar
EXECUTIVE SUMMARY
Since 2014, Glendale Water and Power (GWP) has been utilizing Allegro 8 Energy Trading and Risk Management (ETRM) software to manage its energy trading operations. The City Council approved agreements with Allegro Development Corporation (Allegro), including a Software License and Service Agreement for maintenance and support through June 2024, based on the 10-year expected life of the software.
In June 2023, GWP executed amendment No. 1 with Allegro for ETRM Horizon Upgrade Implementation Analysis (IA), necessary to properly define the scope of work and associated costs for cloud-based or hybrid applications. GWP received the final IA Report in 2024, however decided not to move forward with upgrading the system because the options presented and the cost to upgrade Allegro 8 ETRM software system needed refinement.
While GWP establishes the next steps for upgrading its ETRM software, it is necessary to ensure continued support and maintenance of the current system until replacement software is in place and the new system is fully deployed. Therefore, GWP is requesting funding in the amount of $265,000, increasing the total not-to-exceed amount of the contract to $3,383,204, for the ongoing Software License and Service Agreement covering a term of two years. This will allow for continuity of business, covering maintenance and support services for the existing Allegro 8 ETRM system without interruption of essential services.
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RECOMMENDATION
Authorize the City Manager to execute Amendment No. 3 to the Professional Services Agreement with Allegro to provide additional funding for Software License and Service Agreement for maintenance and support for the Allegro 8 Energy Trading and Risk Management System in the amount of $265,000, increasing the total not-to-exceed amount to $3,383,204.
ANALYSIS
GWP’s current ETRM software system, Allegro 8, was installed in 2014 to address the increasingly complex energy trading activities of GWP and adapt to the changing energy commodity markets in the Western United States and to the State of California regulations imposed on electric utilities. The Allegro software system provides the necessary tools to accurately capture and manage GWP's business, and it monitors and reports on activities as prescribed by the Energy Risk Management Policy for managing volatility in energy costs while minimizing retail electric rates.
In 2014, the City Council authorized execution of various Agreements with Allegro Development Corporation for the installation of Allegro 8 ETRM software for a total amount not to exceed $2,797,629. This amount included annual maintenance fees over the expected 10-year life span of the software. In 2019, Allegro Development Corporation, a global provider of enterprise commodity management solutions, was acquired by ION Group.
The ever-evolving energy trading market and Federal and State Regulations require utilities like GWP, to accurately monitor all transactions related to power supply.
Consequently, the systems and tools used to capture pertinent activity in accordance with the ETRM must be up to date to support contracts management, energy trading, scheduling, settlements and invoicing activities. In 2023, in anticipation of approaching the 10-year mark of this agreement, GWP obtained City Council authorization to execute amendment No. 1 with Allegro Development Corporation, a member of ION Group, for ETRM Horizon Upgrade Implementation Analysis (IA) in the amount of $80,000. Said amendment increased the contract not-to-exceed amount to $2,877,629.
In July 2024, GWP obtained City Council Authorization to execute Amendment No. 2 to provide additional funding for Software License and Service Agreement for maintenance and support services for the Allegro ETRM System. Said amendment increased the contract’s not-to-exceed amount by $240,575, to $3,118,204.
The Software Maintenance and Support Services provided by Allegro is essential to GWP’s Power Management trading operation. Approving additional funding for the ongoing service agreement for two years will allow for continuity of business, without interruption of services.
During this time, GWP staff will establish the project timeline and the next steps for implementation of the software upgrade or replacement ETRM system. Staff is evaluating the implementation of a new ETRM system to enhance operational efficiency and risk oversight. The current plan is to initiate a Request for Proposals (RFP) process 35b
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within the next six months, subject to internal alignment, resource availability, and evolving business needs.
STAKEHOLDERS/OUTREACH
Non-applicable.
FISCAL IMPACT
Funding approved by the City Council for Amendment No. 3 for the continued Software License and Service Agreement for maintenance and support services for the Allegro ETRM System is included in the Power Management Division’s Fiscal Year 2025–26 budget, as outlined below:
Existing Appropriation
Amount Account String Funding Source
$130,000 GL: 43110-5820-GWP-4680-P0000- Electric Works Revenue Fund
Department Cost Center Program
Glendale Water
and Power
Power Management
Funding for the next fiscal year will be requested through the annual budget process for Fiscal Year 2026–27.
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 Allegro Development Corporation, A member of the ION Group:
Full Name Title Business Address City State Zip
Sunil Biswas President,
Secretary and
Director
1345 Ave of the
Americas
New York NY 10105
Wall Street
Systems
Delaware,
Inc.
More than 10%
interest owner
1345 Ave of the
Americas
New York NY 10105
ALTERNATIVES TO STAFF RECOMMENDATION
1. Decline to authorize Amendment No. 3 to the PSA with Allegro to provide additional funding for Software License and Service Agreement for maintenance 45b
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and support services for the ETRM System. Doing so will expose the City to the risk of interruption of service, which can hinder access to the system and pose a violation of the adopted GWP Risk and Trading Authority Policies, as the software maintenance and support services are necessary to make sure that the proper software security patches are applied, and the system is operating at its optimum.
2. Consider any other alternative not proposed by staff.
ADMINISTRATIVE ACTION
Submitted by:
Scott K. Mellon, P.E., General Manager - Glendale Water and Power Prepared by:
Ileana Cardenas, Integrated Resource Planning Administrator Alina Morshidian, Power Contracts Manager
Approved by:
Roubik R. Golanian, P.E., City Manager
EXHIBITS/ATTACHMENTS
None.