Exhibit 1 - Agenda Information SheetCity of Denton
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AGENDA INFORMATION SHEET
DEPARTMENT: Procurement & Compliance
CFO: Antonio Puente, Jr.
DATE: February 4, 2020
SUBJECT
Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation,
authorizing the City Manager to execute a contract with Wartsila North America, Inc., for the purchase of
major overhaul parts for the electric generating equipment at the Denton Energy Center, which is the sole
provider of this equipment, in accordance with Texas Local Government Code 252.022, which provides
that procurement of commodities and services that are available from one source are exempt from
competitive bidding, and if over $50,000 shall be awarded by the governing body; and providing an
effective date (File 7246 – awarded to Wartsila North America, Inc., in the not-to-exceed amount of
$2,028,967.43). The Public Utilities Board recommends approval (7 - 0).
INFORMATION /BACKGROUND
The Denton Energy Center (DEC) was an approved CIP project for DME that reached commercial operation
in June 2018. The DEC provides power at times that renewable energy sources are not readily available.
The DEC is a component of the City of Denton’s future commitment to providing the citizens of Denton
with 100% of electricity from renewable sources of energy.
The DEC’s electric generating equipment (12 Gensets and Auxiliaries) requires maintenance as the units
operate. The maintenance activities are performed as preventative, predictive and corrective maintenance
activities. Preventive and predictive activities are performed as scheduled maintenance based on hours of
operation and corrective maintenance are unplanned component failures that most often cause unit outages.
In order for the DEC team to maintain high unit availability, replacement parts called “swing sets” can be
used to reduce downtime allowing for expeditious return to service timeframes. These swing sets are
components of the engine that require rebuilding or repair during overhauls. The rebuilding of the
component is done onsite utilizing DEC staff or off site at a repair shop. Both methods are time consuming
resulting in revenue potentials being missed. With these major components onsite as swing sets, the outage
times will be drastically reduced due to off-site shipping time frames and/or not having to rebuild/repair the
parts onsite during the overhauls. The parts requiring maintenance are simply taken off the unit and the
swing set part is installed allowing for the repair work of the removed component to take place after the
unit is back available.
In efforts to outsource the components, staff contacted manufacturers of the components not made by
Wärtsilä and are in the process of procurement of those items separately; however, these components are
manufactured by Wärtsilä and not authorized for sale by other suppliers.
City Hall
215 E. McKinney Street
Denton, Texas
www.cityofdenton.com
Section 252.022 of the Local Government Code provides that procurement of sole source commodities and
services are exempt from competitive bidding, if over $50,000, shall be awarded by the governing body.
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On January 27, 2020, the Public Utilities Board (PUB) recommended this item to the City Council for
consideration.
RECOMMENDATION
Award with a contract to Wartsila North America, Inc., as a sole source supplier, for the purchase of major
overhaul parts (Swing Sets) for the electric generating equipment at the Denton Energy Center, in an amount
not-to-exceed $2,028,967.43.
PRINCIPAL PLACE OF BUSINESS
Wärtsilä North America, Inc.
Houston, TX
ESTIMATED SCHEDULE OF PROJECT
Materials will be ordered on an as needed basis until funds are depleted.
FISCAL INFORMATION
These items will be funded from DEC project account 603996501.1365.3460. Requisition #145122 has
been entered into the Purchasing software system in the amount of $2,028,967.43. The budgeted amount
for this item is $2,028,970.43.
EXHIBITS
Exhibit 1: Agenda Information Sheet
Exhibit 2: Presentation
Exhibit 3: Ordinance and Contract
Respectfully submitted:
Lori Hewell, 940-349-7100
Purchasing Manager
For information concerning this acquisition, contact: Jason Brown, 940-349-7140.
Legal point of contact: Mack Reinwand at 940-349-8333.