02-25-2015 HUCMMINUTES
Regular Meeting — Hutchinson Utilities Commission
Wednesday, February 25, 2015
Call to order — 3:00 p.m.
President Hanson called the meeting to order. Members present: President Anthony
Hanson; Secretary Mark Girard; Commissioner Monty Morrow; Commissioner Dwight
Bordson; Attorney Marc Sebora; General Manager Jeremy Carter.
Member absent: Vice President Donna Luhring.
1. Approve Minutes of:
a. January 28, 2015 Regular Meeting
b. February 10, 2015 Special Meeting
The minutes of the January 28, 2015 regular meeting and February 10, 2015
special meeting were reviewed. A motion was made by Commissioner Morrow,
seconded by Commissioner Bordson to approve the January 28, 2015 regular
meeting and February 10, 2015 special meeting minutes. Motion was unanimously
carried.
2. Ratify Payment of Bills for January 2015
The January 2015 payables were discussed. After discussion, a motion was made
by Commissioner Bordson, seconded by Secretary Girard to ratify the payment of
bills in the amount of $2,997,810.40. (detailed listing in payables book). Motion
was unanimously carried.
3. Approve Financial Statements/Budget Year to Date
GM Carter presented the January 2015 financial statements/budget year-to-date
along with a handout of consumption comparisons for January 2014 to January
2015. The comparisons showed higher usage last year because of colder weather
versus this year.
After discussion, a motion was made by Secretary Girard, seconded by
Commissioner Morrow to approve the financial statements/budget year-to-date.
Motion was unanimously carried.
4. Review Policies
GM Carter presented the policies, sections:
• Electric Meter Requirements
• Electric Meter Placement
• Sealing of Meters - Electric
No changes were recommended.
5. Review Exempt and Non -Exempt Employee Handbooks
GM Carter presented exempt and non-exempt handbooks, sections:
• Employment of Relatives
• Membership/Dues/Conventions (Exempt only)
• Data Practices Advisory
No changes were recommended.
6. Approve Date Change for HUC Annual Major Customer Meeting from
Wednesday, April 8, 2015 to Wednesday, April 15, 2015 and Declare as an
Open Meeting
GM Carter explained the reason for the change in date is to accommodate the
guest speakers' schedules.
After discussion, a motion was made by Commissioner Bordson, seconded by
Secretary Girard to approve the date change for HUC's annual major customer
meeting from Wednesday, April 8, 2015 to Wednesday, April 15, 2015 and declare
it as an open meeting. Motion was unanimously carried.
7. Approve Changes to Contract for Parallel Generation Facilities (40 kW or
Less) and Contract for Parallel Generation Facilities (Greater than 40 kW)
Dave Hunstad presented both Parallel Generation Facilities contracts explaining
the changes were to reflect additional language the State Statute requires to ask
new customers.
After discussion, a motion was made by Commissioner Morrow, seconded by
Secretary Girard to approve the changes to the Contract for Parallel Generation
Facilities (40 kW or Less) and Contract for Parallel Generation Facilities (Greater
than 40 kW). Motion was unanimously carried. (Changes attached.)
8. Approve Changes to Policy on Purchasing
GM Carter presented the changes to the Policy on Purchasing to include an
increase in authorized purchasing from $2,000 to $5,000 for managers. Also,
changes were made to the authorized list for credit card purchases eliminating the
Electric Division Director and Customer/Human Relations Manager as these
positions are not filled at this time.
After discussion, a motion was made by Secretary Girard, seconded by
Commissioner Morrow to approve the changes to Policy on Purchasing. Motion
was unanimously carried. (Changes attached.)
9. Approve Additional Cost for Unit 3 Turbocharger Overhaul
Randy Blake presented a quote from Mid -Continent Sales and recommended the
Board increase the previously approved requisition for additional costs for the
replacement of an unrepairable nozzle component.
2
A motion was made by Secretary Girard, seconded by Commissioner Bordson to
approve the additional cost for the Unit 3 Turbocharger Overhaul. Motion
unanimously carried. (Quote attached.)
10. Communication from the City Administrator
City Administrator Jaunich reported:
• The vacant City Council position deadline was yesterday with Bill Arndt being
the only applicant.
11. Division Reports
Electric — Dan Lang
Nothing to report
Electric — Dave Hunstad
Nothing to report
Finance — Jared Martig
• Nick Nelson will present on energy conservation next month.
• Auditor will be presenting next month.
• Received a couple business scam calls today.
Natural Gas — John Webster
• Met last Friday with a community that is interested in forming a municipal
natural gas utility by this fall. They would be tapping into HUC's pipeline,
contracting with HUC to provide transportation, commodity and operation and
maintenance of the system.
• Will be presenting a couple requisitions at the March commission meeting to
purchase new metering for the Highway 212 station.
• Assisting Randy Blake with greenhouse gas reports.
Electric — Randy Blake
• A capital expenditure project is being started at Plant 2 which will take about a
month to complete.
• MPCA visited yesterday with a surprise audit for emissions. The audit went
well.
12. Legal Update
Nothing to report
Unfinished Business
• Discuss Separate Business Unit for Wholesale Business
o GM Carter plans on presenting information to the Board in April.
• Discuss Compensation Study
o GM Carter recommended putting the study on hold until mid -year.
3
New Business
None
There being no further
seconded by Secretary
unanimously carried.
ATTEST:
business, a motion was made by Commissioner Bordson,
Girard to adjourn the meeting at 3:42 p.m. Motion was
Anthony Hanson, President
4
Mark Girard, Secretary
Hutchinson Utilities Commission
Parallel Generation (40 kW or Less) — Net Energy Billing
Amended February 25, 2015
1. Effective In
All territories served by Hutchinson Utilities Commission (HUC).
2. Availabilitv
Available to single-phase and three-phase customers where a part or all of the
electrical requirements of the customer are supplied by the customer's
generating facilities, where such facilities have a total generating capability of 40
kW or less, where such facilities are connected in parallel with HUC and where
such facilities are approved by HUC.
The budget payment plan shall not be available to customers with parallel
generation.
3. Rate
The customer shall be billed monthly on a net energy basis and shall pay the
fixed charge and energy charge as specified in HUC's rate schedule under which
the customer is served.
If, in any month, the Customer's bill has a credit balance of $100 or less, the
amount shall be credited to subsequent bills until a debit balance is
reestablished. If the credit balance is more than $100, the utility shall reimburse
the customer by check upon request.
Monthly credits shall be computed by taking the net excess kilowatt-hours
produced times the average annual wholesale cost of power from the previous
year.
4. Metering and Services Facilities
HUC shall utilize an electric meter capable of measuring electric energy in both
the forward and reverse direction.
5. Contract Required
A contract (Contract for Parallel Generation Facilities (40 KW or Less)) is
required between HUC and the customer -owned generation facility. The contract
shall specify safety, system protection, and power quality requirements that
1
Hutchinson Utilities Commission
Parallel Generation (40 M or Less) — Net Energy Billing
generators must comply with. Contracts with customer -owned generation
facilities selling energy under the standard (non -negotiated) rate have no specific
term or length.
6. Customer Obligation
a. Metering Facilities
The customer shall furnish, install and wire the necessary service
entrance equipment, meter sockets, meter enclosure cabinets, or meter
connection cabinets that may be required by HUC to properly meter usage
and sales to HUC
b. Interconnection Costs
The owner of the generating facility shall be required to pay all
interconnection costs, incurred by HUC. The owner shall pay said costs
prior to the final service connection to the Utility's electrical system
C. Insurance Hold Harmless and Government Approval
The customer shall keep in force a policy of liability insurance, of at least
$300,000.00, against personal or property damage to the utility's system,
equipment and personnel arising from the installation, interconnection,
and operation of the customer's generating facility. The customer shall
provide proof of insurance to HUC on an annual basis with said policy
specifically naming HUC as an insured.
The customer shall indemnify and hold HUC harmless from all claims of
damage whatsoever.
The customer is responsible for obtaining all governmental permits and
approvals.
d. Interconnection and Operational (Safety and Power Quality) Requirements
Electric Service to a customer -owned electric generation installation may
be disconnected for failure to comply with the following requirements.
1) Interconnection of a generating facility with the HUC system shall
not be permitted until application has been made to and approval
received from HUC. The Utility may withhold approval only for good
reason such as failure to comply with applicable HUC or
governmental rules or laws. HUC shall require a contract specifying
2
Hutchinson Utilities Commission
Parallel Generation (40 kW or Less) — Net Energy Billing
reasonable technical connection and operating aspects for the
parallel generating facility.
2) HUC may require that for each generating facility there is provided,
between the generator/s and the utility system, a lockable load -
break disconnect switch. For installations interconnected at greater
than 600 volts, a fused cutout switch may be substituted, where
practicable. The switches shall be accessible to HUC for the
purpose of isolating the parallel generating facility from the HUC
system when necessary.
3) HUC shall require a separate distribution transformer, where
necessary, for a customer having a generating facility for reasons
of public and employee safety or where the potential exists for the
generating facility causing problems with the service of other
customers.
4) HUC shall require that each generating facility have a system for
automatically isolating the generator from HUC's system upon loss
of the HUC supply, unless HUC desires that the local generation be
continued to supply isolated load.
5) HUC shall require that the customer discontinue parallel generation
operations when it so requests and HUC may isolate the generating
installation from its system at times. During such times, HUC shall
not be liable for revenue lost by the customer. Parallel generation
may be disconnected:
a) When considered necessary to facilitate maintenance or
repair of HUC's facilities.
b) When considered necessary during system emergencies.
c) When considered necessary during such times as the
generating facility is operating in a hazardous manner, or is
operating such that it adversely affects service to other
customers or to nearby communication systems or circuits.
6) The owner of the generating facility shall be required to make the
equipment available and permit entry upon the property by electric
and communication utility personnel at reasonable times for the
purpose of testing isolation and protective equipment, evaluating
the quality of power delivered to HUC's system and testing to
M
Hutchinson Utilities Commission
Parallel Generation (40 kW or Less) — Net Energy Billing
determine whether the local generating facility is the source of any
electric service or communication systems problems.
7) The power output of the generating facility shall be maintained such
that the frequency and voltage are compatible with normal HUC
service and do not cause that HUC service to fall outside the
prescribed limits of Commission rules and other standard
limitations.
8) The generating facility shall be operated so that variations from
acceptable voltage levels and other service impairing disturbances
do not result in adverse effects on the service or equipment of other
customers, and in a manner that does not produce undesirable
levels of harmonics in the HUC power supply. The customer agrees
to disconnect the generating facility from HUC's distribution system
or reimburse HUC for the cost of necessary system modifications if
operation of the generating facility causes radio, television, internet,
or electrical service interference to other customers, or interference
with the operation of HUC's electrical system.
9) The owner of the generating facility shall be responsible for
providing protection for the owner's equipment and for adhering to
all applicable national, state and local codes.
10) Customer agrees to locate the generating facility so as to not
interfere with HUC's distribution system. Customer agrees that the
installation shall be in compliance with all applicable electric codes
and the generating facility shall be operated only after the
installation has been inspected and approved by appropriate
authorities. Customer agrees to obtain all required permits, abide
by all building and zoning requirements and applicable inspections.
11) The customer agrees to reimburse HUC for any addition,
modification, or replacement of distribution components made
necessary by the customer's installation.
12) Customer agrees to effectively install grounding and provide surge
arrestor protection to prevent lightning damage to RUC's
distribution system.
IT
Hutchinson Utilities Commission
Parallel Generation (40 kW or Less) — Net Energy Billing
7. Utility Obligation
a. Metering Facilities
HUC shall own and install an appropriate meter in order to record all flows
of energy necessary to bill in accordance with the charges and credits of
the rate schedule.
b. Notice to Communication Firms
HUC shall notify telephone utility and cable television firms in the area
when it knows that a customer -owned generating facility is to be
interconnected with its system. This notification shall be as early as
practicable to permit coordinated analysis and testing in advance of
interconnection.
8. Right to Appeal
The owner of the generating facility interconnected, or proposed to be
interconnected, with HUC's system may appeal to the Commission should any
requirement of HUC's service rules or the required contract be considered to be
excessive or unreasonable. Such appeal shall be reviewed and the customer
notified of the Commission's determination.
5
Contract for Parallel Generation Facilities (40 kW or Less)
This contract is entered into
Commission (hereafter called "Utility") and
(hereafter called "Customer").
RECITALS
by Hutchinson Utilities
PM MITT= 9 NOW12% 321MM-114 7: : NN
Per MN Statute 216B.1611 the Utility shall request the following information for
interconnection of distributed renewable generation.
1) The name plate capacity of the facility (kW)
2) The pre -incentive installed cost of the generating facility
3) The energy source of the facility (Solar, Wind etc.)
4) Location of the facility
The Customer is prepared to generate electricity in parallel with the Utility.
The Customer meets the requirements of the Utility's rules on parallel generation and
any technical standards for interconnection the Utility has established that are
authorized by those rules.
The Utility is obligated under Federal and Minnesota law to interconnect with the
Customer and to purchase electricity offered for sale by the Customer.
AGREEMENTS
The Customer and the Utility agree:
1. The Utility shall sell electricity to the Customer under the rate schedule in force
for the class of customer to which the Customer belongs.
2. Payment per KWH for energy delivered to the Utility, in excess of energy used by
the Customer. $ see #3, Rate, Hutchinson Utilities
Commission Parallel Generation (40 kW or Less) — Net Energy Billing policy.
3. The rates for sale and purchase of electricity may change over the time this
contract is in force, due to actions of the Utility. The Customer and the Utility
0
agree that sales and purchases shall be made under the rates in effect each
month during the time this contract is in force.
4. The Customer must operate its electric generating facilities within any rules,
regulations, and policies adopted by the Utility, which provide reasonable
technical connection and operating specifications for the customer (Hutchinson
Utility Commission's rules and regulations applicable to parallel generation are
attached).
5. The Customer will operate its electric generating facilities so that they conform to
the national, state, and local electric and safety codes, and will be responsible for
the costs of conformance.
6. The Customer is responsible for the actual, reasonable costs of interconnection
which are estimated to be $ The customer shall pay the Utility in
this manner:
7. The Customer shall provide the Utility reasonable access to its property and
electric generating facilities in the event the configurations of those facilities do
not permit disconnection or testing from the Utility's side of the interconnection. If
the Utility enters the Customer's property, the Utility shall remain responsible for
its personnel.
8. The Utility may discontinue providing electricity to the Customer during a system
emergency. The Utility shall not discriminate against the Customer when it
discontinues providing electricity or when it resumes providing electricity.
9. The Utility may discontinue purchasing electricity from the Customer when
necessary for the Utility to construct, install, maintain, replace, remove,
investigate, or inspect equipment or facilities within its electrical system. The
Utility shall notify the Customer prior to discontinuing the purchase of electricity in
this manner:
10. The customer shall keep in force a policy of liability insurance, of at least
$300,000.00, against personal or property damage to the Utility's system,
equipment and personnel arising from the installation, interconnection, and
operation of customer's generating facility and shall provide annual proof of the
insurance to the Utility with said policy specifically naming the Utility as an
insured. The customer agrees to indemnify and hold harmless the Utility from all
claims whatsoever arising from customer's generating system.
11. This contract becomes effective when signed by the Customer and the Utility.
This contract will remain in force until either the Customer or the Utility provides
written notice to the other that the contract is canceled. This contract shall be
canceled 30 days after notice is given.
7
12. This contract does not serve as an approval of the Customer's generating system
for planning, zoning or permit purposes. The Customer shall have the
responsibility to obtain proper approval and permits from the City of Hutchinson
or other governmental entities pertaining to the construction and operation of the
Customer's generating system.
13. This contract contains all the agreements made between the Customer and the
Utility. The Customer and the Utility are not responsible for any agreements other
than those stated in this contract.
THE CUSTOMER AND THE UTILITY HAVE READ THIS CONTRACT AND AGREE
TO BE BOUND BY ITS TERMS. AS EVIDENCE OF THEIR AGREEMENT, THEY
HAVE EACH SIGNED THIS CONTRACT BELOW ON THE DATE WRITTEN AT
THE BEGINNING OF THIS CONTRACT.
Customer
Date:
HUTCHINSON UTILITIES COMMISSION
go
Date:
Hutchinson Utilities Commission
Parallel Generation (Greater than 40 kW) — Net Energy Billing
Amended February 25, 2015
1. Effective In
All territories served by Hutchinson Utilities Commission (HUC).
2. Availabilitv
Available to single-phase and three-phase customers where a part or all of the
electrical requirements of the customer are supplied by the customer's
generating facilities, where such facilities have a total generating capability of
greater than 40 kW where such facilities are connected in parallel with the utility.
The energy rate indicated below is the minimum for electrical energy. Should
HUC be unwilling to pay the minimum rate for electrical energy, HUC shall agree
to transport such electrical energy to another utility that is willing to pay a
different rate. HUC shall recover actual costs of such transportation from the
generating customer.
The budget payment plan will not be available to customers with parallel
generation
3. Rate
Customers shall receive monthly payments for all electricity delivered to HUC
and shall be invoiced by HUC for metering and associated billing expenses
specified in the latest rates of the wholesale supplier unless the latest rates of the
wholesale supplier do not properly reflect avoided costs. In such event, the
Commission, upon request, may determine appropriate rates. HUC shall have on
file a copy of the latest customer -owned generation system rates for its
wholesale supplier.
4. Minimum Charge
The monthly minimum charge paid by the customer shall be the customer
charge.
5. Power Factor
The customer shall operate on a net power factor of not less than 94 percent. A
power factor penalty will apply if the power factor drops below 94 percent.
1
Hutchinson Utilities Commission
Parallel Generation (Greater than 40 kW) — Net Energy Billing
6. Negotiated Rates
Customers with generation systems greater than 40 kW have the right to
negotiate a buy-back rate. The buy-back rate may not be greater than the full,
avoided cost.
The following are the required procedural guidelines:
a. HUC must respond to the customer -owned generating system within 30
days of the initial written receipt of the customer -owned generating system
proposal and within 30 days of receipt of a subsequent customer -owned
generating system proposal,
b. HUC's rejection of the customer -owned generating system proposal must
be accompanied by a counter-offer relating to the specific subject matter
of the customer -owned generating system proposal, and
C. If HUC is unable to respond to the customer -owned generating system
proposal within 30 days it shall inform the customer -owned generating
system of:
1) Specific information required to evaluate the customer -owned
generating system proposal.
2) The precise difficulty encountered in evaluating the customer -
owned generating system proposal.
3) The estimated date that it HUC will respond to the customer -owned
generating system proposal.
d. The Commission may become involved in the utility negotiations upon
showing by either HUC or the customer -owned generating system that a
reasonable conclusion cannot be reached under the above guidelines.
The Commission may provide a waiver to the guidelines and order new
negotiation requirements such that a reasonable conclusion may be
reached.
e. A copy of all negotiated buy-back rates shall be provided to the
Commission. These rates shall not be in effect until approved by the
Commission.
2
Hutchinson Utilities Commission
Parallel Generation (Greater than 40 kW) — Net Energy Billing
7. Charges for Energy Supplied by HUC
Energy supplied by HUC to the customer shall be invoiced in accordance with
the standard applicable rate schedules of the utility.
8. Maintenance Rate
A customer -owned generation facility may be billed lower demand charges for
energy purchased during scheduled maintenance, provided written approval is
obtained in advance from HUC. Demand charges other than "Distribution
Demand" shall be prorated in the event maintenance is scheduled such that HUC
does not incur additional capacity costs. Said proration shall be demand charge
times the number of authorized days of scheduled maintenance divided by the
number of days in the billing period.
9. Contract Required
A contract is required between HUC and the customer -owned generation facility.
The contract shall specify safety, system protection, and power quality rules that
generators must comply with. Contracts with customer -owned generation
facilities selling energy under a negotiated rate shall contain performance
requirements and be of sufficient length to ensure HUC avoids the costs for
which the customer -owned generation facility has been paid.
10. Customer Obligation
a. Metering Facilities
The customer shall furnish, install and wire the necessary service
entrance equipment, meter sockets, meter enclosure cabinets, or meter
connection cabinets that may be required by HUC to properly meter usage
and sales to HUC
b. Interconnection Costs
The owner of the generating facility shall be required to pay all
interconnection costs, incurred by HUC. The owner shall pay said costs
prior to the final service connection to the Utility's electrical system
3
Hutchinson Utilities Commission
Parallel Generation (Greater than 40 kW) — Net Energy Billing
C. Insurance Hold Harmless and Government Approval
The customer shall keep in force a policy of liability insurance, of at least
$1 Million, against personal or property damage to the Hutchinson Utilities
Commission's system, equipment and personnel arising from the
installation, interconnection, and operation of the customer's generating
facility. The customer shall provide proof of insurance to HUC on an
annual basis with said policy specifically naming HUC as an insured.
The customer shall indemnify and hold HUC harmless from all claims of
damage whatsoever.
The customer is responsible for obtaining all governmental permits and
approvals.
d. Interconnection and Operational (Safety and Power Quality) Requirements
Electric Service to a customer -owned electric generation installation may
be disconnected for failure to comply with the following requirements.
1) Interconnection of a generating facility with the HUC system shall
not be permitted until application has been made to and approval
received from HUC. The Utility may withhold approval only for good
reason such as failure to comply with applicable HUC or
governmental rules or laws. HUC shall require a contract specifying
reasonable technical connection and operating aspects for the
parallel generating facility.
2) HUC may require that for each generating facility there is provided,
between the generator/s and the utility system, a lockable load -
break disconnect switch. For installations interconnected at greater
than 600 volts, a fused cutout switch may be substituted, where
practicable. The switches shall be accessible to HUC for the
purpose of isolating the parallel generating facility from the HUC
system when necessary.
3) HUC shall require a separate distribution transformer, where
necessary, for a customer having a generating facility for reasons
of public and employee safety or where the potential exists for the
generating facility causing problems with the service of other
customers.
0
Hutchinson Utilities Commission
Parallel Generation (Greater than 40 kW) — Net Energy Billing
4) HUC shall require that each generating facility have a system for
automatically isolating the generator from HUC's system upon loss
of the HUC supply, unless HUC desires that the local generation be
continued to supply isolated load.
5) HUC shall require that the customer discontinue parallel generation
operations when it so requests and HUC may isolate the generating
installation from its system at times. During such times, HUC shall
not be liable for revenue lost by the customer. Parallel generation
may be disconnected:
a) When considered necessary to facilitate maintenance or
repair of HUC's facilities.
b) When considered necessary during system emergencies.
c) When considered necessary during such times as the
generating facility is operating in a hazardous manner, or is
operating such that it adversely affects service to other
customers or to nearby communication systems or circuits.
6) The owner of the generating facility shall be required to make the
equipment available and permit entry upon the property by electric
and communication utility personnel at reasonable times for the
purpose of testing isolation and protective equipment, evaluating
the quality of power delivered to HUC's system and testing to
determine whether the local generating facility is the source of any
electric service or communication systems problems.
7) The power output of the generating facility shall be maintained such
that the frequency and voltage are compatible with normal HUC
service and do not cause that HUC service to fall outside the
prescribed limits of Commission rules and other standard
limitations.
8) The generating facility shall be operated so that variations from
acceptable voltage levels and other service impairing disturbances
do not result in adverse effects on the service or equipment of other
customers, and in a manner that does not produce undesirable
levels of harmonics in the HUC power supply. The customer agrees
to disconnect the generating facility from HUC's distribution system
or reimburse HUC for the cost of necessary system modifications if
operation of the generating facility causes radio, television, internet,
or electrical service interference to other customers, or interference
with the operation of HUC's electrical system.
Hutchinson Utilities Commission
Parallel Generation (Greater than 40 kW) — Net Energy Billing
9) The owner of the generating facility shall be responsible for
providing protection for the owner's equipment and for adhering to
all applicable national, state and local codes.
10) Customer agrees to locate the generating facility so as to not
interfere with HUC's distribution system. Customer agrees that the
installation shall be in compliance with all applicable electric codes
and the generating facility shall be operated only after the
installation has been inspected and approved by appropriate
authorities. Customer agrees to obtain all required permits, abide
by all building and zoning requirements and applicable inspections.
11) The customer agrees to reimburse HUC for any addition,
modification, or replacement of distribution components made
necessary by the customer's installation.
12) Customer agrees to effectively install grounding and provide surge
arrestor protection to prevent lightning damage to HUC's
distribution system.
11. Utility Obligation
a. Metering Facilities
HUC shall own and install an appropriate meter in order to record all flows
of energy necessary to bill in accordance with the charges and credits of
the rate schedule.
b. Notice to Communication Firms
HUC shall notify telephone utility and cable television firms in the area
when it knows that a customer -owned generating facility is to be
interconnected with its system. This notification shall be as early as
practicable to permit coordinated analysis and testing in advance of
interconnection.
12. Right to Appeal
The owner of the generating facility interconnected, or proposed to be
interconnected, with HUC's system may appeal to the Commission should any
requirement of HUC's service rules or the required contract be considered to be
excessive or unreasonable. Such appeal shall be reviewed and the customer
notified of the Commission's determination.
C
Contract for Parallel Generation Facilities (Greater than 40 kW)
This contract is entered into
Commission (hereafter called "Utility") and
(hereafter called "Customer")
RECITALS
by Hutchinson Utilities
�. - -
Per MN Statute 216B.1611 the Utility shall request the following information for
interconnection of distributed renewable generation.
1) The name plate capacity of the facility (kW)
2) The pre -incentive installed cost of the generating facility
3) The energy source of the facility (Solar, Wind, etc.)
4) Location of the facility
The Customer is prepared to generate electricity in parallel with the Utility.
The Customer meets the requirements of the Utility's rules on parallel generation and
any technical standards for interconnection the Utility has established that are
authorized by those rules.
The Utility is obligated under Federal and Minnesota law to interconnect with the
Customer and to purchase electricity offered for sale by the Customer.
AGREEMENTS
The Customer and the Utility agree:
1. The Utility shall sell electricity to the Customer under the rate schedule in force
for the class of customer to which the Customer belongs.
2. Payment per KWH for energy delivered to the Utility, in excess of energy used by
the Customer. $ see #3, Rate, Hutchinson Utilities
Commission Parallel Generation (Greater than 40 kW) — Net Energy Billing
policy.
1
Per MN Statute 216B.1611 the Utility shall request the following information for
interconnection of distributed renewable generation.
1) The name plate capacity of the facility (kW)
2) The pre -incentive installed cost of the generating facility
3) The energy source of the facility (Solar, Wind, etc.)
4) Location of the facility
The Customer is prepared to generate electricity in parallel with the Utility.
The Customer meets the requirements of the Utility's rules on parallel generation and
any technical standards for interconnection the Utility has established that are
authorized by those rules.
The Utility is obligated under Federal and Minnesota law to interconnect with the
Customer and to purchase electricity offered for sale by the Customer.
AGREEMENTS
The Customer and the Utility agree:
1. The Utility shall sell electricity to the Customer under the rate schedule in force
for the class of customer to which the Customer belongs.
2. Payment per KWH for energy delivered to the Utility, in excess of energy used by
the Customer. $ see #3, Rate, Hutchinson Utilities
Commission Parallel Generation (Greater than 40 kW) — Net Energy Billing
policy.
1
3. The rates for sale and purchase of electricity may change over the time this
contract is in force, due to actions of the Utility. The Customer and the Utility
agree that sales and purchases shall be made under the rates in effect each
month during the time this contract is in force.
4. The Customer must operate its electric generating facilities within any rules,
regulations, and policies adopted by the Utility, which provide reasonable
technical connection and operating specifications for the customer (Hutchinson
Utility Commission's rules and regulations applicable to parallel generation are
attached).
5. The Customer will operate its electric generating facilities so that they conform to
the national, state, and local electric and safety codes, and will be responsible for
the costs of conformance.
6. The Customer is responsible for the actual, reasonable costs of interconnection
which are estimated to be $ The customer shall pay the Utility in
this manner:
7. The Customer shall provide the Utility reasonable access to its property and
electric generating facilities in the event the configurations of those facilities do
not permit disconnection or testing from the Utility's side of the interconnection. If
the Utility enters the Customer's property, the Utility shall remain responsible for
its personnel.
8. The Utility may discontinue providing electricity to the Customer during a system
emergency. The Utility shall not discriminate against the Customer when it
discontinues providing electricity or when it resumes providing electricity.
9. The Utility may discontinue purchasing electricity from the Customer when
necessary for the Utility to construct, install, maintain, replace, remove,
investigate, or inspect equipment or facilities within its electrical system. The
Utility shall notify the Customer prior to discontinuing the purchase of electricity in
this manner:
10. The customer shall keep in force a policy of liability insurance, of at least $1
Million, against personal or property damage to the Hutchinson Utilities
Commission's system, equipment and personnel arising from the installation,
interconnection, and operation of customer's generating facility and shall provide
annual proof of the insurance to the Utility with said policy specifically naming the
Hutchinson Utilities Commission as an insured. The customer agrees to
indemnify and hold harmless the Utility from all claims whatsoever arising from
customer's generating system.
11. This contract becomes effective when signed by the Customer and the Utility.
This contract will remain in force until either the Customer or the Utility provides
E
written notice to the other that the contract is canceled. This contract shall be
canceled 30 days after notice is given.
12. This contract does not serve as an approval of the Customer's generating system
for planning, zoning or permit purposes. The Customer shall have the
responsibility to obtain proper approval and permits from the City of Hutchinson
or other governmental entities pertaining to the construction and operation of the
Customer's generating system.
13. This contract contains all the agreements made between the Customer and the
Utility. The Customer and the Utility are not responsible for any agreements other
than those stated in this contract.
THE CUSTOMER AND THE UTILITY HAVE READ THIS CONTRACT AND AGREE
TO BE BOUND BY ITS TERMS. AS EVIDENCE OF THEIR AGREEMENT, THEY
HAVE EACH SIGNED THIS CONTRACT BELOW ON THE DATE WRITTEN AT
THE BEGINNING OF THIS CONTRACT.
Customer
as
Date:
3
HUTCHINSON UTILITIES COMMISSION
Date:
Amended Aprr'rl24, cvTv
Amended February 25, 2015
POLICIES
POLICY ON PURCHASING
State Statute 471:345
Hutchinson Utilities Commission hereby adopts a general policy on the purchasing of
equipment, supplies and services.
Purchasing Agent is authorized to create requisitions and approve purchase orders for
purchases associated with Hutchinson Utilities' standard inventory part numbers, which
are based on set order points and order quantities.
If requirements exceed current order quantities, either an approved Bill of Materials or
an approved requisition will be required.
All other purchases shall require supervisor permission. Emergency situations may
require a deviation from this policy to insure electric and/or natural gas services to the
customers of the Hutchinson Utilities. Joint purchasing of materials, supplies and
services shall be considered with other departments only when net economic benefits
can be seen. When a tie exists between low bids, preference will be given to a local
supplier.
For purchases when the estimate is more than $100,000:
1. The Hutchinson Utilities Commission will request permission to advertise for bids.
2. Specifications shall be made available to all prospective bidders.
3. Bids will be opened at a public bid opening. Date will be set in the advertisement
for bids.
4. The staff will review bids and recommend to the Hutchinson Utilities Commission
to accept the lowest responsible bidder meeting specifications.
5. Hutchinson Utilities Commission will enter into a contract with the responsible
bidder.
For purchases between $25,000 and $100,000:
1. The Hutchinson Utilities Commission staff will solicit written, informal quotations
from at least three (3) suppliers and tabulate the results.
2. Fuel purchases for electrical generation is an exception, for additional exceptions
refer to Minnesota Statutes 2003, 471.345 Uniform Municipal Contracting Law.
3. Staff will recommend acceptance of the lowest responsible quote.
4. Hutchinson Utilities Commission will approve the quote.
For purchases up to $25,000:
1. General Manager authorized to approve purchases up to $25,000.
2. For purchases of $5,000 - $25,000, the Hutchinson Utilities Commission
staff will solicit written, informal quotations from at least two (2) suppliers
and tabulate the results.
3. Staff will recommend acceptance of the lowest responsible quote to the
General Manager for approval.
For purchases up to $5,000:
Directors and the City Attorney are authorized to approve requisitions via the WIN -STS
System for purchases requiring a purchase order number.
If purchase order numbers are not required each Division may use their assigned credit
card.
1. Division Director will approve all item requests prior to purchasing the item.
2. Receipts will be given to each Division Director as items are purchased to initial,
assign appropriate account number and give a description of the item
purchased; then forward to Accounting.
3. Accounting will keep a file for each Division until monthly credit card statements
are received and reconciled.
For purchases up to $2,0A95,000:
Managers are authorized to approve requisitions via the WIN -STS System for
purchases requiring a purchase order number.
If purchase order numbers are not required, each department may use their assigned
credit card.
1. Department manager will approve all item requests prior to purchasing
item.
2. Receipts will be given to each department manager as items are
purchased to initial, assign appropriate account number and give a
description of the item purchased; then forward to accounting.
3. Accounting will keep a file for each department until monthly credit card
statements are received and reconciled.
Petty cash may be used for purchases less than $25.00.
Employees may make local purchases with prior approval from their
Director/Manager. The employee has the option of using a HUC credit card, paying
cash for the item, if less than $25.00, and being reimbursed from petty cash, or
making the purchase at a local retailer with whom we have an account established.
All receipts must to be turned in to the appropriate Director/Manager to initial, assign
appropriate account number and then forward to the financial manager.
CREDIT CARDS
A purchase by credit card must comply with all statutes and rules applicable to
Hutchinson Utilities Commission (HUC) purchases. Credit card purchases must comply
with the following requirements:
Minn. Stat. 412.271, subd. 2 and 471.38, subd.1. Claims presented to HUC for payment
must be in writing and itemized. Bills from credit card companies do not contain the
detail necessary to satisfy these requirements; therefore, HUC must retain invoices and
itemized receipts for items charged to a credit card.
The Office of the State Auditor strongly urges local government units to develop a
comprehensive credit card use policy to avoid misappropriation of funds or other misuse
of the credit card.
The following are authorized to make credit card purchases on behalf of HUC:
General Manager
EleGtrir Dlyms*en DlreGtnr
Natural Gas Division Director
Electric Transmission/Distribution Manager
Production Manager
Engineering Services Manager
Purchasing Agent
Company purchases up to $5,000 are allowed to be made with a credit card. No
personal purchases are to be made with the credit card. Receipts will be given to each
Division Director/Manager as items are purchased to initial, assign appropriate account
numbers and give a description of the item purchased. The receipt then gets forwarded
to the financial manager.
The financial manager will keep a file for each Division until monthly credit card
statements are received and reconciled. The financial manager has the authority to
approve and question all credit card purchases in so far as the policy applies. The full
amount of the statement must be paid each month.
FIXED ASSET CAPITALIZATION
The Hutchinson Utilities Commission (HUC) will regard fixed assets as capitalized when
all of the following criteria are met:
(1) Assets purchased, built or leased have useful lives of one year or
more.
(2) The cost of the asset (including installation) is $5,000 or more. Multiple
assets whose cost is less than $5,000 but the aggregate requestor
total is $5,000 or more are capitalized.
(3) The cost of repairing or renovating the asset is $5,000 or more and
prolongs the life of the asset.
HUC will regard the purchase of software programs as fixed assets subject to the above
capitalization policy, and will amortize over an estimated useful life of 3 years. Costs
associated with software maintenance and customer support are considered
expenditures and will not be capitalized.
Other Considerations:
(1) REPAIR is an expenditure that keeps the property in ordinary efficient
operating condition. The cost of the repair does not add to the value or
prolong the life of the asset. All repair expenditures are charged to the
appropriate department and fund.
(2) IMPROVEMENTS are expenditures for additions, alterations and
renovations that appreciably prolong the life of the asset, materially
increase its value or adapt it to a different use. Improvements of the nature
are capitalized.
Examples of Repairs vs. Improvements
Repairs=Expenditures
All items -life less than one year
All items under $5,000
Property maintenance, wall repair
Replacement of machine parts to keep
machine in normal operating condition
Property restoration (rebuilding) for
normal operations
Existing building repairs
Replacement of small sections of wiring,
pipes or light fixtures
Patching walls, minor repairs of floors,
painting, etc.
Patching driveways
Improvements=Capital!zed Assets
Life of more than one year
All items $5,000 or more
Property rebuilding
Replacement of machine parts that
prolong the useful life
Property restoration for something
different or better
Building regulation conformity
Major replacement of wiring,
lighting, pipes or sewer
Installation of floor, wall, roof,
wall covering, etc.
New driveway or major repair
Cleaning drapery, carpet, furniture New drapery, carpets, furniture
Depreciation Method — Straight Line over the following useful lives:
Buildings
35-60 years
Transmission Plant (electric)
20-35 years
Distribution Plant (electric)
20-35 years
Building Improvement
15-30 years
Transmission Plant (gas)
10-45 years
Distribution Plant (gas)
10-45 years
Generation Plant
10-30 years
General Plant
5-10 years
Vehicles
5-10 years
Office Equipment
3-5 years
Computer Equipment
3-5 years
Mid -Continent sales
P.O. Box 12887 • Wichita, KS 67277-2887
3900 Rita Street • Wichita, KS 67213
(316)945-0023 • (316) 945-0143 FAX
www.midcontinentmfg.com
Attn: customer
Randy Blake Hutchinson Utilities
225 Michigan St.
Phone 320-234-0551 Hutchinson, MN 55350
Fax 320-587-4721
Quotation
Quote #
2945
Date
11/11/2014
Item
Qty
Part No.
Description
Delivery
Price Ea.
Total
1
1
Miscellaneous
Repair Nozzle Ring
3,456.65
3,456.65
2
1
Miscellaneous
ABB VTR500 Rotor Repair, Case
14,811.54
14,811.54
Repair
Includes:
1. Clean and Inspect Bladed Disc
2. Rebuild and Zyglo 66 Turbine
Blades
3. Install New Lashing Wire
4. Polish and Measure Shaft; Check
Straightness
5. Clean and Inspect Impeller
6. Balance Bladed Shaft Impeller
7. Clean and Inspect Turbine Case
8. Repair Crack in Turbine Case
9. Prepare for Shipment
*THIS IS AN ESTIMATE ONLY.
BASED ON THE ABOVE JOB
SCOPE. ANY ADDITIONAL
WORK OR PARTS WOULD BE
EXTRA. WE WILL BE GLAD TO
GIVE FIRM QUOTE ONCE WE
HAVE DISASSEMBLED AND
EVALUATED YOUR UNIT.
Out-of-state sale, exempt from sales
0.00%
0.00
tax
Terms
Quoted By
FOB
Tota I $18,268.19
Net 30
Micky
Wichita KS
Thank you for the
All Quotes Subject to Prior Sale.
opportunity to quote.
Quote valid: 60 Days
MID-CONTINENTMFG.
2-13-2015
City of Hutchinson, MN
VTR 500 - Turbocharger #67595-96
Randy,
Here is a breakdown of the turbocharger parts repairs after final inspection:
ORIGINAL QUOTE
Repair Impeller & turbine blades- $11,798.00
Repair crack in Case- $958.00
Shaft polish and inspection- $2,055.54
Nozzle Ring repair- $3,456.65
Total- $18,268.19
Minus Nozzle Ring repair- -$3,456.65 (Damaged beyond Repair)
Total- $14,811.54
FINAL QUOTE
Original quote- $14,811.54
Case Crack Repair- 3,475.00 (Pressure Tested 3x)
Sleeve (2) Case Bores $1,904.88 - There are (2) seal bores in the center of the case were the laby
rings on the rotor shaft have contacted in the past and need to be sleeved.
Total-
$20,191.42
Parts-
$11,590.94 (Not Included In Original Estimate)
1
Nozzle ring
$10,267.50
1
Guide Bushing
$275.81
8
Lock washer
$91.20
1
Dampening wire
$625.00
16
Locking plate
$100.00
1
Shrink ring
$231.43
Total
$31,782.36
Minus
10% -Total
$28,604.13
P/N: VTR500-218 $500.00
Please let us know when we are to proceed with the repairs.
-rk4m.k y
M i sky
Micky Thompson
Mid Continent Mfg & Sales
Cell - 316-651-6946
E-mail - micky@midcontinentmfg.com
Web page - www.midcontinentmfg.com
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