6.2. ERMUSR 11-12-2003 ) -h%
Elk River
Municipal Utilities
322 King Avenue phone: 763.441.2020
Elk River,MN 55330 Far 763.441.8099
November 3, 2003
To: Elk River Municipal Utilities Commission
John Dietz
Jerry Takle
James Tralle
From: Bryan Adams
Subject: Great River Energy Capacity Purchase Agreement
The Elk River Municipal Utilities 10 MW diesel generation at our power plant has been
contracted to Great River Energy. This contract expired October 31, 2003. Attached is a
revised contract from Great River Energy for our diesel generation which reflects the
same terms and conditions except this contract is on an evergreen basis.
Based upon our most recent URGE test of 10,407kw, our annual payments for this diesel
generation capacity is $343,431. Commission president John Dietz, authorized execution
of this agreement upon staffs recommendation. This should be confirmed by the utility
commission.
<It
GREAT RIVER
ENERGY')
17845 East Highway 10 • P.O. Box 800 • Efk River, Minnesota 55330-0800 • 763-441-3121 • Fax 763-241-2366 • www.GreatRiverEnergy.com
October 30, 2003
Mr. Bryan Adams
General Manager
Elk River Municipal Utilities
322 King Avenue
Elk River, MN 55330
Dear Bryan:
The purpose of this letter is to extend, on an "evergreen" basis, the contract
under which Great River Energy (GRE) has purchased the capacity and energy
available from the diesel generation units owned by Elk River Municipal Utilities
(ERMU).
The current contract will expire on October 31, 2003. By returning one copy of
this letter, signed by you, to Betsy Engelking, the following amendments to the
existing agreement will take effect immediately.
1. The termination date will change to October 31, 2005. With each
succeeding year the termination date will be incremented by one year.
Either ERMU or GRE may provide the other party notice, no later than
April 1 of a given year, terminating the contract at the termination date
during that given year.
2. ERMU will perform a MAPP annual URGE test and GRE will pay ERMU
110 percent of the actual production cost to perform the test.
3. GRE will pay ERMU a monthly capacity payment equal to the sum of the
individual unit URGE test ratings times the capacity charge rate ($2.75/kW
month). Each annual updated unit URGE test rating will become effective
during the MAPP URGE reporting period of November through the
following October.
A Touchstone Energy"Cooperative 4r)f
Mr. Bryan Adams
October 30, 2003
Page 2
4. All other terms of the attached existing contract will remain in effect as
currently written.
Since ly,
Bets ngelking, • / "�' -"- ✓'�
Manager, Resource Planning Bryan ams, General Manager
Great River Energy Elk Riv r Municipal Utilities
H:\Deb Cavan Selander\102803 Contract Amend 10 2003 B.Doc
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--k GREAT RIVER
ENERGY`"
17843 East Highway 10 • P.O. Box 800 • Elk River, Minnesota 55330-0800 • 612-441-3121 = Fax 612-241-2366
February 9, 2000
Mr. Bryan Adams
General Manager
Elk River Municipal Utilities
322 King Avenue NW
Elk River, MN 55330
Subject: Capacity Purchase/Sale Agreement Extension and Amendment
Dear Mr. Adams,
The purpose of this letter is providing the terms and conditions necessary to further amend the
capacity purchase/sale agreement between Elk River Municipal Utilities and United Power
Association dated June 23, 1994 and the previous amendment dated October 23, 1998. If you
agree with the terms listed below and with the existing terms in the attachment (with references to
UPA change to GRE), please sign below and return an original copy to me.
1. Contract term: the current contract was amended to end on October 31, 2001. The
1 contract is hereby further amended such that the term is extended to October 31, 2003
2. Capacity price: the capacity price is changed to$2.75 per kilowatt month for the
remaining term of the amended agreement and will be first applied in the January 2000
billing cycle.
Sincerely,
GREAT Rh' NERDY Oa
Thomas A. Larson, P.E.
• President, Resource Development
ormation :ec� n`10
�
I o
Date: ,- _dO
:ryan Adams
General Manager
Elk River Municipal Utilities
Attachment: Existing Terms and Conditions
C: Stan Selander
ir
A Touchstone Energy'Cooperative )(
y-.
Attachment to Elk River Municipal Utilities and
Great River Energy letter dated February 9, 2000
1. This agreement applies to the following Elk River diesel units: •
Unit# Nominal Capacity
1 550 kW
2 500 kW
3 3000 kW
4 5400 kW
Total 9500 kW
2. Elk River agrees to operate, maintain, and test the Units in accordance with the Article III
of the Interconnection Agreement and in a manner which allows the capacity of the Units
to be accredited toward GRE's capacity obligations to the Mid-Continent Area Power
• Pool (MAPP).
3. The capacity price shall be applied to the MAPP accredited capacity of the Units.
4. The energy price paid by GRE to Elk River shall be 110%of the actual average
production cost per kilowatthour (kWh) produced by the Units.The average production
cost is defined as the average fuel cost in mills per kWh plus a mutually agreed to
allowance for actual variable costs of production other than fuel.
5. Elk River shall inform GRE immediately of any equipment failure or other condition which
affects the production capacity or operational availability of the Units.
•