Exhibit 1 - Agenda Information SheetCITY OF DENTON
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AGENDA INFORMATION SHEET
DEPARTMENT: Procurement and Compliance
ACM: David Gaines
DATE: December 17, 2020
SUBJECT
Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation,
rejecting any and all competitive proposals under RFP 7215 for Utility Scale Solar with Energy Storage for
Denton Municipal Electric.
INFORMATION/BACKGROUND
In early 2020, City Council directed Denton Municipal Electric (DME) to evaluate the potential for battery
storage in the renewable energy supply portfolio. The Request for Proposals included a small utility scale
solar farm (5 MW) with a 1 MW battery (2 MWh) so the City could take advantage of investment tax credits
that are not available to batteries alone.
DME received 19 different offers from 9 companies, from which DME staff sent 4 requests for best and
final offers. These offers consisted of an initial power purchase agreement period, where ownership,
operation, and maintenance of the facilities would reside with a third-party on leased land. The land would
have been provided by either University of North Texas or DME. After this initial power purchase period
(from 5 to 10 years), DME would have exclusive rights to purchase the entirety of the facilities at a pre-
determined price. The objective of this structured deal was to fully monetize the tax benefits and minimize
risk premiums of third-party ownership.
After evaluation of the offers, DME staff presented the results to City Council. The results showed that the
final offers would still represent “above market” contracts for power, meaning extra expense to rate payers
above what could be acquired in competitive bilateral markets. Also, DME does not need any of these
projects to achieve their 100% renewable energy mandate. It is for these reasons, staff recommends rejecting
all bids. This item will not be rebid.
In accordance with the Local Government Code 252.043, the City Council may reject any and all bids.
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On December 14, 2020, this item will be presented to the Public Utilities Board (PUB) for consideration.
RECOMMENDATION
Staff recommends rejection of all proposals under RFP 7215 for Utility Scale Solar with Energy Storage.
City Hall
215 E. McKinney Street
Denton, Texas
www.cityofdenton.com
EXHIBITS
Exhibit 1: Agenda Information Sheet
Exhibit 2: Ordinance
Respectfully submitted:
Lori Hewell, 940-349-7100
Purchasing Manager
For information concerning this acquisition, contact: Tony Roybal, 940-349-7179.
Legal point of contact: Marcella Lunn at 940-349-8333.