HomeMy WebLinkAboutC-3163 - Rebate agreement under Edison's clean power program1
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Si =' 81997
I APPROVED
TO: Mayor and City Council Members
FROM: Public Works Department
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September 8, 1997
CITY COUNCIL AGENDA
ITEM NO. 6
C -31 (03
SUBJECT: APPROVE REBATE AGREEMENT UNDER SOUTHERN
CALIFORNIA EDISON'S CLEAN POWER PROGRAM
RECOMMENDATION:
1. Approve a rebate agreement with Southern California Edison for the Dolphin and
Tamura wells.
2. Authorize the Mayor and City Clerk to execute the agreement on behalf of the City.
DISCUSSION:
During the design phase of the Dolphin and Tamura wells, representatives from
Southern California Edison (SCE) informed the City of SCE's Clean Power Program
(CPP). The CPP provides a rebate to customers who purchase energy - efficient electric
motors rather than gas operated engines. The City's estimated rebate ranges between
$100,000 and $150,000 for the Dolphin and Tamura wells where the City installed four
(4) electric motors.
A rebate range between $100,000 and $150,000 has been estimated because SCE
has not completed their power analysis of our new motors. The exact rebate is
calculated based upon annual operating hours used and the total new kilowatts added
to the Edison distribution system through the installation of the electric motor. The
actual rebate will be determined in September 1997 after our wells are fully operational.
A copy of SCE's brochure describing the CPP is attached for additional information
along with a copy of the rebate agreement.
The Public Works Committee considered this item at its August 25, 1997 meeting and
authorized staff to forward the agreement to City Council for approval.
iSouthelkalifornia Edison Rebate Agreement
September 8, 1997
Page 2
CONCLUSION:
It is staffs recommendation that the City Council approve the rebate agreement.
Respectfully submitted,
PUBLIC WORKS DEPARTMENT
Don Webb, Director
(2�6 .�.._..��.
.. Davidson
Utilities Manager
EGD:tam
Attachment: Copy of Rebate Agreement
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EDISON
M E015U.,' INTER \'JTII >1'.rL`O Cwnpny
• • PRODUCTS & SERVICES
NEW CLEAN POWER REBATE
MAKES IT EASIER TO INSTAIJ. OR
REACTIVATE ELECTRIC MOTORS
INTRODUCING THE CLEAN POWER
PROGRAM
Southern California Edison is
pleased to introduce a new pro-
gram which provides a rebate for
customers who purchase or reactivate
energy -efficient electric motors.
THE NEW CLEAN POWER PROGRAM
The Clean Power Program (CPP)
provides an incentive for customers
who wish to install or reactivate highly
efficient, environmentally - friendly
electric motors. The program was
designed to offset the costs of installing
new motors or modifying operations.
If you rely on
non- doctric
prime movers
such as engines,
electric motor
can add to your
bottom line
and can help you
avoid costly
environmental
compliance
WHAT APPLICATIONS QUALIFY FOR
THE CPP7
A wide range of industries involved in
pumping, processing, or compressing, air,
gas, oil, water, refrigerants, waste and
other fluids are all good candidates for
the CPP.
HOW IS THE CPP CALCULATED?
The rebate amount offered to the
customer under the CPP is calculated
based on annual operating hours used
and the total new kW load added to
the Edison distribution system through
the installation of the electric motor.
For example, a customer who installs a
200 kW electric motor operating for
5,000 hours /year would qualify for a
$25,000 rebate (200 kW x $125 - $25,000).
please m chart beloat
Incentives are calculated baud upon incremental nameplate kW and operating boon
a
�. Operating
Operating
Operating
Operating
a
less Than 2000
2001 -4000
4001.6000
More Than 0001
If the customer is of to:
Hours Per Year
Hours Per Year
Hours Per Year
Hours Per Year
INSTALL an electric motor
INSTEAD of a viable non-
$75AcW
$95AcW
$125/kW
$150/kW
electric option
REPLACE an engine a
$75AcW
MAW
$12WkW
$150/kW
turbine with an electric motor
RE -START idled electric
motors (that have been idled
$20AcW
$30W
$40/kW j
$501kW
for at least 2 years)
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more about qualifying
for the cash incentive
or other programs.
Internet address:
(www.edisonx.com)
SOUIMFR�CAI1ipIN1•
EDISON
An E060NINY AWAL- C�
HOW DO 1 QUALIFY FOR THE CPP?
There are three scenarios under which
a customer can qualify for the CPP
rebate
• The customer installs an electric
motor rather than another viable
non - electric option
• The customer replaces an operating
engine or turbine with an electric
motor
• The customer reactivates electric
motors idled for at least 2 years
The incentive chart (on page 1) shows
the rebate amounts for customers with
different operating profiles To see if
you qualify, please contact your Edison
representive for further details.
WHY USE ELECTRIC MOTORS FOR
PUMPING, COMPRESSION, OR
PROCESSES?
Electric motors can help you improve
your bottom line because they are eas-
ier to operate and require less mainte-
nance than non - electric options With
electric motors you don't have to worry
about fluctuations in fossil -fuel prices
or meeting emissions requirements
Edison customers who use non - electric
drivers to pump, compress, or process
water, air, gas, oil or other fluids can
benefit from the many advantages .
electric motors
ELECTRIC MOTORS ARE HIGHLY
EFFICIENT
Electric motors are much more efficient
than engines or turbines— you can do
more work with a smaller motor and
less energy input.
ELECTRIC MOTORS ARE BETTER FOR
THE ENVIRONMENT
Both stationary and mobile engines are
considered significant sources of air
pollution. Electric motors, however, emit
virtually no pollutants. Even when you
consider the emissions created at the
generating plants to power the electric
motors, reduction in air pollution is
substantial.
ELECTRIC MOTORS ARE EASIER TO
MAINTAIN
Electric motors require substantially
maintenance than engines Motors are
easier to keep running and more reli-
able. Less maintenance translates to cost
savings for you.
ELECTRIC MOTORS ARE EASIER TO
OPERATE REMOTELY
Simply put, you cannot remotely oper-
ate engines, while electric motors can
be easily operated remotely. This means
savings for you resulting from less per-
sonnel dedicated to work in the field.
ELECTRIC MOTORS ARE QUIETER
In many areas noise pollution can.be as
much of a problem as air pollution. If
you operate in communities sensitive to
noise pollution, electric motors are the
right choice for you.
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CLEAN POWER PROGRAM
• CUSTOMER AGREENIEIVT
(Installation and Operation of Electric Motor)
THIS AGREEMENT ( "Agreement ") is entered into as of 1997 ( "Effective Date "),
between Southern California Edison Company ( "Edison "), located at
2244 Walnut Grove Avenue, Rosemead, California 91770, and:
Edison Customer ( "Customer"):
Customer Name: City of Newport Beach
Address: 3300 Newport Beach
City, State and Zip Code: Newport Beach, California 92658
Phone No.: 714644 -3011 Fax NO.: 714 - 646 -5204
Contact Name: Eldon Davidson Title: Manager
Edison Acct No.: CSS: 0- 001 -4735
Tax ID NoJSS No.: 95- 6000751
_ Corp. _ Non -Corp. _Medical z Exempt (explain, if exempt):
The purpose of this Agreement is to provide a financial incentive to the Customer for participation in
Edisons Clean Power Program ( "Program ").
This Agreement applies to the following Customer site:
Project ( "Project Site "):
Project Tale: New Motors
Project Address: 16° Street, Dolphin Ave., Tumura School
City. State and 4 Code: Newport Beach, California 92658
TERMS AND CONDITIONS OF THIS AGREEMENT:
(a) Eligibility. The Project Site must be located in Edisons service territory, and
Customer must be or become an Edison Customer who takes service through Edisons distribution
lines and under the Edison rate schedules referenced in Exhft "A" attached hereto and incorporated
herein by reference. Except for the incentive to be paid pursuant to this Agreement, Customer shall not
be eligible for any other incentives from Edison, including, but not limited to. Environmental Pricing
Credits or Demand-Side Management incentives, which might otherwise apply to the installation and
operation of the Equipment (as defined in Section 1(b)).
Customer hereby aclmowledges receipt of Edison's Program Customer Brochure
( "Program Brochure"), and understands that Program incentive levels, as described in the Program
Brochure, are based on Howatt ("kW") motor size and projected annual number of operating hours.
(b) Pur4hase or Lease of Motor. Customer shall purchase or lease and install the
following energy efficient electric motor(s) ( "Equipment) at the Project Site iastead of a viable non-
. electric option:
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Number of motors: Five
For each motor, provide the following information:
Size in hp: 1,650
Size in nameplate kW: 1,230.9
Energy Efficiency Rating: .956
Projected annual # of hours of operation: 5,800; 7,300; 5,843; 5,110;5,843
Projected annual kWh consumption: 7,701,758
The Equipment must comply with applicable minimum State and federal energy efficiency standards.
The choice of Equipment, selection of contractors, purchase of materials, work performed and the
payment therefor are the sole responsibility of the Customer. Customer shall ensure that the
Equipment is installed and operated in accordance with applicable safety standards and existing
governmental regulations.
(c) Use of Motor, Reimbursement Customer hereby commits to operate the
Equipment at the Project Site for a period of not less than two (2) years from the date of Edison's on-
site verification of the installation and operation of the Equipment ( "Operations Period "). The
Equipment must use annually a minimum of seventy-five percent (75%) of the annual kilowatt-hour
("kWh ") consumption projected above ( "Consumption Threshold") during the Operations Period If
Customer does not operate the Equipment and meet or exceed the Consumption Threshold during
each twelve (12) month period of the Operations Period as described above, Edison shall be entitled to
reimbursement from Customer for that portion of the Verified Incentive (as defined in Section 2(b))
paid to Customer ('Reimbursement ").
If the Verified Incentive is less than One Hundred Fifty Thousand Dollars ($150,000),
the amount of the Reimbursement shall be calculated as follows:
(Verified Incentive a- 24 months) x # of months in which Consumption Threshold was
not met = Reimbursement
Fr 118V I&%3.S FINAL (NO.d)
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FOR EXAMPLE: If Verified Incentive paid was $48,000 + 24 months
_ $2,000/month
Projected annual # of hours of operation = 2,400
2,400 + 12 months = 200 hrsJmonth =
Monthly Consumption Threshold
13 months of non - compliance with Monthly Consumption
Threshold
13 x $2,000 = $26,000 Reimbursement to Edison
If Verified Incentive is One Hundred Fifty Thousand Dollars ($150,000) or mote, the
Reimbursement shall be calculated as follows:
(First installment of Verified Incentive -t- by 12 months) x # of months
in which Consumption Threshold was not met = Reimbursement.
FOR EXAMPLE: If first installment of Verified Incentive was $84,000
+ 12 months = $7,000/month
Projected annual # of hours of operation = 6,000
6,000 + 12 months = 500 hrsJmonth =
Monthly Consumption Threshold
5 months of non - compliance with Monthly Consumption
Threshold
5 x $7,000 = $35,000 Reimbursement to Edison
If the Consumption Threshold is not met after twelve (12) months of operation of the Equipment, then
the second installment shall not be paid, in accordance with Section 2(c) below. If the Consumption
Threshold is met after such twelve (12) month period, then the second installment shall be paid, but
shall be subject to reimbursement as provided above.
(d) Implementation Dead he. Customer shall install and begin to operate the
Equipment on or before October 1, 1997 ("Implementation Deadline") (which date shall not extend
beyond 1997). Customer shall notify Edison immediately upon the completion of Equipment
installation. If the Equipment is not installed and operated by the Implementation Deadline, Edison
shall not be obligated to pay any incentive to Customer under the Program.
(e) Verifrcadon Prior to being entitled to receive an incentive, and thereafter
during the Operations Period, Customer must allow Edison representatives reasonable access, during
normal business hours, to the Project Site to verify the installation and operation of the Equipment
("Site Verification "). If access to the Project Site is delayed due to the Customer or for other reasons
beyond EdisoWs control, the time within which Edison is required to verify the Equipment (sir forth is
Section 2(b)) shall be extended by the number of business days that access is delayed.
(f) Supporting Documentation.
must provide a copy of an invoice, purchase order,
proof of purchase or lease of the Equipment on
Equipment manufacturer name, model no.,
vendor /d stributor/nstalleilkwor, customer name,
length of time the lease.
WINIf%3.S FiNALpY A)
3
On or before Edison's Site Verification, Customer
lease, or other suitable documentation, showing
or after February 3, 1997, and providing the
sepal no., name and address of the Equipment
the date of sale or lease of the Equipment, and
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2. Edison's Oblirrati
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(a) Projected Incentive. Based on the information provided to Edison by i
Customer in Section 1(b), the projected incentive amount ( "Projected Incentive ") to be paid by Edison
to Customer is $158,480 which was calculated in accordance with the incentive levels set forth in the
Program Brochure.
Edisons obligation to pay the incentive is contingent upon installation and operation of
the Equipment at the Project Site by the Implementation Deadline. Edison shall deliver an executed
copy of this Agreement to the Customer after acceptance and execution by Edison. Edison will only
execute this Agreement if there are sufficient funds available under the Program to pay the Projected
Incentive.
(b) Verification and Verified Incentive. Edison shall verify the installation and
operation of the Equipment at the Project Site within ten (10) business days of Edisons receipt of
Customers notificat ion that the Equipment has been installed. The amount of the incentive may vary
from the Projected Incentive, due to a change in the actual equipment installed and/or hours of
projected annual operation ( "Verified Incentive "). Edison reserves the right, exercisable in its sole
discretion, to adjust the amount of the incentive upward or downward (as the case may be) to reflect
the forecasted increase or decrease in energy consumption at the Project Site as a result of such
changes. Customer accepts as final authority Edisods determination of the Verified Incentive.
(c) Payment of Verified Incentive. Within thirty (30) business days after the Site
Verification, Edison shall issue a check made payable to Customer in the amount of the Verified
Incentive.
Verified Incentives of One Hundred Fifty Thousand Dollars ($150,000) or more shall
be paid in two (2) equal irwalhnents. The fast installment shall be paid as provided above after Site
Verification of the Equipment. The second installment shall only be paid if after twelve (12) months of
operation of the Equipment, the Consumption Threshold has been achieved If such Consumption
Threshold is not achieved, Edison shall not be obligated to pay the second installment to Customer.
Within ten (10) business days after Edisons verification that the Consumption Threshold was achieved,
Edison shall issue a check made payable to Customer for the second installment. Customer accepts as
final authority Edison s determination of whether the Consumption Threshold has been achieved based
on meter readings or other use- related justifications acceptable to Edison
3. Term and Termination. This Agreement is effective as of the Effective Date, and shall
terminate at the end of the Operations Period.
4. No. Warranty EDISON MAKES NO WARRANTY, WHETHER
STATUTORY, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, ANY
WARRANTIES CONCERNING THE INSTALLATION AND OPERATION OF THE
EQUIPMENT, THE BENEFITS TO BE DERIVED FROM SUCH INSTALLATION AND
OPERATION, PRODUCT ENDORSEMENT, TECHNICAL FEASIBILITY,
OPERATIONAL CAPABILITY AND /OR RELIABILITY OF THE EQUIPMENT, OR ANY
WARRANTY OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR USE OR
APPLICATION. No agent, employee, or representative of Edison has authority to bind Edison to
any affirmation, representation or warranty, unless expressly made and agreed to in writing by Edison.
5. Indemnification Customer shall, at its own cost, defend, indemnify and hold harmless
Edison, its officers, employees, agents, assigns, and successors in interest, from and against any and an
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liability, damages, losses, claims, demands, actions, causes of action, costs, including, but not limited to
death or injury to any person or damage to any property, and inchtding attorney's fees and expenses, or
any of them, arising out of the installation and/or operation of the Equipment, or the performance or
non-performance of Customer's obligations under this Agreement
6. Limitation of Liability. Edison shall not be liable for any damages, claims, losses, costs
or expenses (including attorneys fees and costs) and including, without limitation, any special,
incidental, indirect or consequential damages incurred by Customer as a insult of this Agreement
and/or the installation and operation of the Equipment
7. Payment of Taxes. Incentives paid to Customer may be subject to taxation by both the
federal government and the State of California. Customer shall be solely responsible for the payment
of any and all applicable local, state, and federal taxes in connection with incentives paid to Customer
pursuant to this Agreement If required under applicable law, Edison will report incentive payments
trade to Customer to the federal government and the State of California.
8. Survival of Provisions. Sections 4, 5, 6 and 7 hereof shall survive and continue after
any termination of this Agreement
9. Tariffs and Rules: Metering. This Agreement does not affect the applicability of
Edison's California Public Utilities Commission - approved tariff schedules and rules to the terms and
conditions of electric service provided to the Customer. If meters need to be installed in order for
Edison to provide electric service to Customer as a result of this Agreement, the cost of the meters and
their installation shall be paid by Customer to Edison in accordance with the provisions of Rule 2.H.,
Added Facilities, for which a separate contract is requited.
10. Miscellaneous. No party hereto may assign this Agreement or any obligation or right
hereunder without the prior written consent of the other party. All provisions of this Agreement shall
be binding upon, inure to the benefit of; and be enforceable by and against the respective successors
and assigns of the patties hereto. This Agreement shall be governed by, interpreted under and enforced
in accordance with the laws of the State of California. Any action brought to enforce or interpret this
Agreement shall be filed in Los Angeles County, California In the event that any one or more
provisions contained in this Agreement should for any reason be held unenforceable in any respect,
such unenforceabtb'ty shall not affect any other provision of this Agreement, and this Agreement shall
be construed as if such unenforceable provision(s) had not been contained herein. The waiver by a
party of the performance of any covenant, condition, obligation, representation, warranty or promise in
this Agreement shall not invalidate this Agreement or be deemed a waiver by such party of any other
covenant, condition, obligation, representation, warranty or promise. The waiver by any party of the
time for performing any act or condition hereunder does not constitute a waiver of the act or condition
itself This Agreement may be executed in one or more counterparts, each of which shall be deemed an
original, but all of which, together shall constitute one and the same instrument. This Agreement
contains the entire agreement between the parties as to the subject matter hereof; and all agreements
and understandings between the parties are embodied and expressed herm Any amendments to this
Agreement shall be in writing and shall be signed by all parties hereto. In the event of any legal action
or other proceeding between the parties arising out of this Agreement or the transactions contemplated
herein, the prevailing pay in such legal action or proceeding shall be entitled to have and recover from
the other party all costs and expenses incurred therein, including reasonable attorney's fees.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by
their duly authorized representatives as of the date first written above.
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APPROVED AS TO FORM: CITY OF NEWPORT BEACH
A Municipal Corporation
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By: By:
Robin Clauson Kevin J. Murphy, City Manager
Assistant City Attorney City of Newport Beach
City of Newport Beach
ATTEST: SOUTHERN CALIFORNIA EDISON
COMPANY, a California corporation
By: By:
LaVonne Harkless Pam A. Bass, Vice President
City Clerk Customer Solutions
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0 EXMIT "A"
RATE SCHEDULES FOR CLEAN POWER PROGRAM
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MINIMS FWAL (N69.9)
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