HomeMy WebLinkAboutORD 2013-20 - Risk Management Policy ERCOTOrdinance Number PD 0
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
GEORGETOWN, TEXAS ADDING SECTION 13.38 TO THE CODE OF
ORDINANCES OF THE CITY OF GEORGETOWN ENTITLED "RISK
MANAGEMENT POLICY" AUTHORIZING PARTICIPATION IN THE
ERCOT CRR MARKET AND CODIFYING PROCEDURES FOR
MANAGING RISK EXPOSURE AND THE MAINTENANCE OF
ASSOCIATED DOCUMENTS, REPEALING CONFLICTING
ORDINANCES AND RESOLUTIONS; INCLUDING A
SEVERABILITY CLAUSE; AND ESTABLISHING AN EFFECTIVE
DATE.
WHEREAS
the Electric
Reliability Council of Texas (ERCOT)
has issued risk management
standards for
participants
in the Congestion Revenue Rights (CRR)
Market, and
WHEREAS compliance with ERCOT risk management standards is necessary to maintain
compliance with ERCOT's Standard Form Agreement allowing for participation in the ERCOT
Marketplaces.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
GEORGETOWN, TEXAS THAT:
Section 1. The meeting at which this ordinance was approved was in all things
conducted in compliance with the Texas Open Meetings Act, Texas Government Code, Chapter
551.
Section 2. The facts and recitations contained in the preamble of this ordinance are
hereby found and declared to be true and correct and are incorporated by reference herein and
expressly made a part hereof, as if copied verbatim.
Section 3.
Section 13.38
of the
Code of Ordinances of the City of Georgetown, Texas is
hereby added and
shall provide as
shown
in EXHIBIT A.
Section 4. If any provision of this ordinance or application thereof to any person or
circumstance shall be held invalid, such invalidity shall not affect the other provisions, or
application thereof, of this ordinance which can be given effect without the invalid provision or
application, and to this end the provisions of this ordinance are hereby declared to be severable.
Ordinance Number: S �
Description: Risk Management rcot Ordinance
Date Approved: � 2013
Page 1 of 4
Section 5. All ordinances that are in conflict with the provisions of this ordinance be, and
the same are hereby, repealed and all other ordinances of the City not in conflict with the
provisions of this ordinance shall remain in full force and effect.
Section 6. The Mayor is hereby authorized to sign this ordinance and the City Secretary
to attest. This Ordinance shall become effective and be in full force and effect ten (10) days on
and after publication in accordance with the provisions of the Charter of the City of Georgetown.
PASSED AND APPROVED on First Reading on the (1y", day of 62v,; , 2013.
PASSED AND APPROVED on Second Reading on the y day of _,2013,
ATTEST.
Jessiba Brettle, City Secretary
APPROVED AS TO FORM:
Bridget Chapman, Actirig City Attorney
Ordinance Number: 420, 3 ` ?0
Description: Risk Management Ercot Ordinance
Date Approved: AA(&4 2013
THE CITY OF GEORGETOWN
George Garver, Mayor
Page 2 of 4
Sec. 13.38. 010 - Authority for Staff Participation in the ERCOT CRR Market
Georgetown Utility Systems has the authority to participate in any Electric Reliability
Council of Texas's (ERCOT) Congestion Revenue Rights (CRR) auction in accordance with
ERCOT protocols and the City's policies to cover any congestion risks associated with
delivery of energy associated with any wholesale power agreements the City has in place.
A. The General Manager of Utilities shall be responsible for Market participation and may
delegate this authority to any appropriate staff member as necessary.
1. Any representative of the City participating or evaluating the City's participation in
the CRR auction must be able to demonstrate reasonable knowledge of CRRs and the
auction process.
B. The Georgetown City Council, Georgetown Utility Systems Advisory Board, the
individual Advisory Board Members, and individual Council Members are prohibited
from trading or purchasing CRRs.
Seca 13.38.020 - Management of Risk Exposure
A. The Georgetown City Council shall oversee all risk undertaken by Georgetown Utility
Systems (GUS).
B. The General Manager of Utilities must report to the City Council the following GUS
related transactions:
I . Any participation in the ERCOT CRR auction;
2. Any wholesale power agreements;
3. Any gas futures contracts; or
4. Any other transactions that expose the City to significant risk.
C. The City Council shall be notified of any risk exposure in the initial report referenced in
Section 13.38.020 (B) and shall be informed of the level of exposure to the risk as
additional information becomes available.
Ordinance Number: )";)o
Description: Risk Mana ement `E cot Ordinance
Date Approved: —ti , 2013
Page 3 of 4
D. The General Manager of Utilities shall issue a report on the status of participation in the
CRR auction to the City Council at the City Council meeting immediately prior to the
next month's CRR auction.
1. The report shall include:
a. Maximum exposure in upcoming auctions, including CRRs intended to be
purchased and the bid price that the City will be submitting for each CRR block.
b. Performance of the previous month's CRRs against not participating in the
market.
L Performance includes total monies spent on CRR purchases and total monies
earned on CRR revenue.
c. Total exposure to congestion in the current month.
2. In the first meeting following the end of the fiscal year, the General Manager of
Utilities shall report to the City Council:
a. Overall performance of the past year's CRRs.
b. The valuation or mark to market of the previous and forthcoming year's risk
positions.
E. Should the City Council find that GUS is acting in manner contrary to the risk profile that
the City Council had previously established, the City Council may:
1. Order GUS to cease the offending risk exposing activities.
2. Issue guidelines for the risk exposing activities to follow.
3. Allow GUS to continue acting as it had previously.
Sec. 13.38.030 - Maintenance of Records
The City shall maintain records of all monetary transactions and transfers related to
participation in the CRR market and of all bid prices and amounts placed in the CRR auction
for a minimum of five years or in accordance with the City's records retention policy,
whichever is longer.
Ordinance Number: €3 - o
Description: Risk Management Ercot Ordinance
Date Approved: , 2013
Page 4 of 4