Exhibit 1 - Agenda Information SheetCity of Denton
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AGENDA INFORMATION SHEET
DEPARTMENT: Procurement
ACM: Cassey Ogden
DATE: January 14, 2025
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 WEG Transformers USA LLC, for the purchase of
substation power transformers for Denton Municipal Electric; providing for the expenditure of funds
therefor; and providing an effective date (RFP 8582 – awarded to WEG Transformers USA LLC, for three
(3) years, with the option for two (2) additional one (1) year extensions, in the total five (5) year not-to-
exceed amount of $24,890,000.00).
INFORMATION/BACKGROUND
Denton Municipal Electric (DME) has approved Capital Improvement Plan (CIP) projects that will require
the purchase of 25/33/50/56 MVA power transformers. DME solicited Request for Proposals (RFP) to
provide 138kV to 24.9kV/13.2kV power transformers.
Power transformers located within substations convert voltage from the transmission level (138,000 volts)
to the distribution level (24,900 volts or 13,200 volts) for use on distribution circuits that serve customers.
Dual secondary distribution voltage transformers will be purchased to plan for the conversion to 24,900
volts while maintaining the ability to serve the existing 13,200 distribution system voltage. Purchasing dual
voltage units will avoid the potential future replacements of transformers that have not reached the end of
their respective lives.
DME proposes to purchase up to seven (7) transformers over the life of the contract. Four (4) transformers
will be purchased initially and three (3) future purchases. DME plans the four (4) initial transformers to be
placed at the following locations:
• New Underwood Substation – Two (2) power transformers
• Jim Christal Substation – One (1) power transformer
• Masch Branch Substation – One (1) power transformer
The marketplace is worldwide and can be problematic for the purchase of power transformers. Product
quality, manufacturing methods, and design practices vary significantly between manufacturers. The best
value evaluation methodology was employed for this RFP because it allows for important factors such as
performance history, compliance with specification, lead time, and price including losses to be considered
in the evaluation of the RFP.
City Hall
215 E. McKinney Street
Denton, Texas
www.cityofdenton.com
The market for transformers has been quite volatile over the past few years. A 10% contingency was
included in the contract amount to account for freight, price changes in raw materials, and unexpected
design changes. The proposed contract does not require the expenditure of any minimum amount.
Contract Estimate
Item Price
7 Power Transformer - 25/33/50/56 MVA, 3PH, 60Hz.
138kV Delta to 24.9kV x 13.2kV $22,537,200
Spare Parts 85,500
Total 22,622,700
10% Contingency 2,262,270
Total with Contingency (rounded to the nearest $10,000) $24,890,000
Request for Proposals was sent to 886 prospective suppliers, including 34 Denton firms. In addition,
specifications were placed on the Procurement website for prospective suppliers to download and advertised
in the local newspaper. Four (4) proposals were received, with three (3) meeting specifications. References
were checked, and proposals were evaluated based upon published criteria including price, delivery,
compliance with specifications, and probable performance. Best and Final Offers (BAFO) were requested
from the top firm. Based upon this evaluation, WEG Transformers USA LLC was ranked the highest and
determined to be the best value for the City.
NIGP Code Used for Solicitation: 285, 287, 553, 578, & 691
Notifications sent for Solicitation sent in IonWave: 886
Number of Suppliers that viewed Solicitation in IonWave: 52
HUB-Historically Underutilized Business Invitations sent out: 89
SBE-Small Business Enterprise Invitations sent out: 351
Responses from Solicitation: 4
Responses Meeting Specifications: 3
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On January 13, 2025, this item will be presented to the Public Utilities Board (PUB) for consideration.
RECOMMENDATION
Award a contract with WEG Transformers USA LLC, for the purchase of substation power transformers
for Denton Municipal Electric, in a three (3) year, with the option for two (2) additional one (1) year
extensions, in the total five (5) year not-to-exceed amount of $24,890,000.
PRINCIPAL PLACE OF BUSINESS
WEG Transformers USA LLC
Washington, MO
ESTIMATED SCHEDULE OF PROJECT
This is an initial three (3) year contract with options to extend the contract for two (2) additional one (1)
year periods, with all terms and conditions remaining the same.
FISCAL INFORMATION
These products will be funded through DME’s CIP budget on an as-needed basis. The City will only pay
for products rendered and is not obligated to pay the full contract amount unless needed.
EXHIBITS
Exhibit 1: Agenda Information Sheet
Exhibit 2: Pricing Evaluation
Exhibit 3: Presentation
Exhibit 4: Ordinance and Contract
Respectfully submitted:
Lori Hewell, 940-349-7100
Purchasing Manager
For information concerning this acquisition, contact: Mark Zimmerer, 940-349-7169.
Legal point of contact: Marcella Lunn at 940-349-8333.