Georgetown will move to hire energy consultants within months 

Georgetown officials hope to hire consultants within the next few months to help sell off excess energy not used by customers of the city’s utility that has led to millions of dollars in budget shortfalls over the past several years.

“Hopefully by the time we get to April and May we’ll have more answers,” General Manager of Utilities Jim Briggs said Feb. 12.

The city announced Feb. 8 it issued two requests for proposals: one seeking a consultant to oversee its energy portfolio and another to review the city’s management of energy purchases.

Georgetown officials are trying to reduce the excess amount of energy the city is obligated to buy through its contracts with wind and solar power producers. The situation caused a $6.84 million shortfall in the city budget’s electric fund for fiscal year 2017-18.

Projected energy costs for Georgetown between 2016 and 2018 were $26 million lower than what the city needed to meet its contractual obligations and provide electric service.

The requests do not affect the city’s attempts to renegotiate its wind and solar contracts, which are led by city management, Briggs said.

“We’re continuing to have conversations with them,” Briggs said. “Neither one of these [requests for proposals]impact the conversation and discussions that we’re having.”

The city set a Feb. 21 deadline for proposals to review the internal management of its energy contracts and a March 7 deadline for proposals to take over management of the city’s energy portfolio.

After proposals and bids are received, Georgetown City Council will decide selections.

The city has $40,000 in its fiscal year 2018-19 budget for the management assessment.

Costs for hiring a consultant for the city’s energy portfolio will be based on submitted bids.

Briggs declined to detail a range of how much the city might pay a third party to manage its energy portfolio, citing the nature of the bidding process.

“It’s kind of a competitive process,” Briggs said. “I don’t really want to put something out there at this point in time until we have the proposals.”

The city entered a 20-year, 144 megawatt-hour capacity deal with EDF Renewable Energy’s Spinning Spur 3 wind farm that began operating in 2015 and a 25-year, 150-mWh agreement with the Buckthorn solar plant, now owned by Clearway Energy, that began operating in 2018.

Georgetown also has smaller contracts with a wind farm operated by American Electric Power that expire in 2028 and a natural gas producer owned by Mercuria that will end in 2022.

Georgetown has an existing contract with Garland Power and Light to manage energy sales mostly involving the Mercuria contract, Briggs said.

City officials have said the decision to buy more energy than Georgetown needs in the present day was part of a strategy to plan for future growth and take advantage of increasing prices predicted in the state’s wholesale energy market managed by the Electric Reliability Council of Texas.

The city must sell its excess energy on the wholesale market, but predictions of increased prices in the market have not proven true over the past several years, according to city officials.