ERMUSR MISC Memo 02-24-2009~/
Elk River -~
Municipal Utilities
13069 Orono Parkway • PO. Box 430
Elk River, MN 55330-0430
February 24, 2009
To: Elk River Municipal Utilities Commission
Jerry Takle
Jerry Gumphrey
John Dietz
From: Vance Zehringer
Phone: 763.441.2020
Fax: 763.441.8099
Enclosed is the packet for the Tuesday, February 24, 2009, Commission meeting
beginning at 4:30 P.M.
January 09 electric energy use is up compared to January 08 use by 9.8%. Colder
temperatures, United Health, and other minor load growth account for the increase.
Electric demand for the same period is up by only 2.9% -- this is a positive statistic.
January 09 water use is up compared to January 08 use by 8.6%. An unspecified portion
of that increase may be due to losses in abandoned homes in which water pipes froze and
burst when either gas or electric services were shut off for nonpayment. That problem is
being remedied and will be discussed under agenda item 6.1. Agenda item 6.1 includes,
for your consideration, a proposed Utility Policy and a City Ordinance regarding water
shutoffs in foreclosed/abandoned homes.
Work continues to find a replacement wholesale power supplier. To date, inquiries have
been made to Central Minnesota Municipal Power Agency, Connexus Energy (our
present power supplier for another 9.5 years), Wright-Hennepin Electric, and Minnesota
Municipal Power Agency. Several other possibilities have been identified, but no contact
has been initiated as of this date pending an initial offer from Connexus Energy. Refer to
Attachment A for project status. Also attached for your signatures is a copy of the
Confidentiality Agreement referred to in Attachment A.
Elk River Municipal Utilities is scheduled to present its annual report to the Elk River
City Council on March 2, 2009. Attachment B outlines the information we propose to
present.
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CONFIDENTIALITY AGREEMENT
THIS CONFIDENTIALITY AGREEMENT is entered into as of by and between
Connexus Energy, a Minnesota electric cooperation with its principal place of business at 14601 Ramsey
Blvd NW, Ramsey, MN 55303 (hereinafter "Connexus"), and the City of Elk River, Minnesota for its
Department, Elk River Municipal Utilities, a Minnesota municipal utility with its principal place of
business at 13069 Orono Parkway, P.O. Box 430, Elk River, MN (the "Receiving Party").
WHEREAS, Connexus is a electric distribution cooperative in Minnesota, serving the energy
needs of customers across portions of Anoka, Chisago, Hennepin, Isanti, Ramsey, Sherburne, and
Washington counties.
WHEREAS, Elk River Municipal Utilities is a Department of the City of Elk River, providing
electric and water service to the City of Elk River and managed by the Elk River Utilities Commission - a
Commission of the City of Elk River.
WHEREAS, Connexus has entered. into discussions with the Receiving Party regarding the
provision of electric energy and capacity to Receiving Party under along-term power purchase agreement
("Power Supply Negotiations");
WHEREAS, for the mutual benefit of the Parties, Connexus may provide Trade Secret
Information (as defined below) to the Receiving Party; and
WHEREAS, the Parties wish to define their respective rights and obligations with respect to such
Trade Secret Information;
NOW THEREFORE, in consideration of the mutual covenants contained herein, the Parties
agree as follows:
1. As used herein, the term "Trade Secret Information" means information which is of anon-public,
proprietary or confidential nature to Connexus, including all reports and analyses, technical and economic
data, studies, forecasts, trade secrets, research or business strategies, financial or contractual information
or other written or oral information regarding Connexus or the Power Supply Negotiations. Trade Secret
Information may be in any form whatsoever, including writings, computer programs, logic diagrams,
component specifications, drawings or other media. All information disclosed by Connexus that is
clearly labeled as "TRADE SECRET INFORMATION -NOT FOR PUBLIC DISCLOSURE" and
provided to the Receiving Party shall be treated by Receiving Party as Trade Secret Information pursuant
to Minnesota Statutes Section 13.37, subdivision 1 (b), unless otherwise expressly agreed in writing by
Connexus.
Receiving Party expressly acknowledges that information provided by Connexus relating to the
Power Supply Negotiations is Trade Secret Information (1) provided by Connexus (2) that is the subject
of efforts by Connexus that are reasonable under the circumstances to maintain its secrecy, and (3) that
derives independent economic value, actual or potential, from not being generally known to, and not
being readily ascertainable by proper means by, other persons who can obtain economic value from its
disclosure or use.
2. Notwithstanding the provisions of paragraph 1, the term "Trade Secret Information" shall not
include, and the Receiving Party shall not be under any obligation to maintain in confidence or not use,
any information (or any portion thereof) disclosed to it by Connexus to the extent that such information:
(i) is in the public domain at the time of disclosure; or
(ii) following disclosure, becomes generally known or available through no act or omission
on the part of the Receiving Party; or
(iii) is known, or becomes known, to the Receiving Party from a source other than Connexus
or its Representatives (as defined herein), provided that disclosure by such source is not
in breach of a confidentiality agreement with Connexus; or
(iv) is independently developed by the Receiving Party without violating any of its
obligations under this Agreement; or
(v) is legally required to be disclosed by judicial or other governmental action; provided,
however, that prompt notice of such judicial or other governmental action shall have
been given to Connexus and that Connexus shall be afforded the opportunity (consistent
with the legal obligations of the Receiving Party) to exhaust all reasonable legal
remedies to maintain the Trade Secret Information in confidence.
Trade Secret Information shall not be deemed to fall within the exceptions of subparts (i) to (iv) above
merely because it is included in a document which also includes information that does fall within such
exceptions.
3. The Receiving Party shall keep the Trade Secret Information confidential and shall use the Trade
Secret Information solely in connection with the Power Supply Negotiations and make all reasonable
efforts to prevent its disclosure under the Minnesota Government Data Practice Act, Chapter 13 of
Minnesota Statutes. The Receiving Party shall not disclose the Trade Secret Information to any person,
except that the Receiving Party may disclose Trade Secret Information to any directors, officers,
employees, attorneys, accountants, consultants, advisors and agents (collectively, "Representatives") of
the Receiving Party who require access to such information in connection with the evaluation of the
Project. Before disclosing any Trade Secret Information to a Representative, the Receiving Party shall
inform such Representative of the confidential or proprietary nature thereof and of the Receiving Party's
obligations under this Agreement, and shall obtain the Representative's written agreement to observe the
terms of this Agreement. The Receiving Party shall be responsible for any use or disclosure of Trade
Secret Information by any of its Representatives.
4. All rights to Trade Secret Information disclosed pursuant to this Agreement are reserved to
Connexus. No license or conveyance of any rights relating to the Trade Secret Information is granted or
implied by Connexus to the Receiving Party.
5. This Agreement shall commence as of the date first set forth above and shall continue in effect
until five years from the date hereof. The obligations of confidentiality contained herein shall survive the
termination of this Agreement.
6. Nothing in this Agreement shall obligate Connexus to disclose any Trade Secret Information to
the Receiving Party, and any disclosure of Trade Secret Information shall be at Connexus' sole discretion.
This Agreement does not constitute a commitment or promise by Connexus to proceed with any
transaction. Connexus does not make any representation or warranty as to the accuracy or completeness
of any Trade Secret Information. Neither Connexus nor any of its respective Representatives will have
any liability relating to or arising from any use of or reliance upon the Trade Secret Information.
7. Upon Connexus' request, the Receiving Party shall return to Connexus as promptly as practicable,
but in any event within thirty (30) days, all Trade Secret Information in the possession of the Receiving
Party or its Representatives, including all copies of such Trade Secret Information, all notes or other
documents with respect to or reflecting such Trade Secret Information, and all materials derived from
such Trade Secret Information. Upon completing the foregoing, the Receiving Party shall give Connexus
a certificate confirming its compliance with this Paragraph 7.
8. This Agreement embodies all of the understandings between the Parties hereto concerning the
subject matter hereof, and merges all prior discussions and writings between them as to confidentiality of
information other than as expressly provided in this Agreement, or as duly set forth subsequent to the date
hereof in writing and signed by both Parties. This Agreement may not be assigned by either Party
without the prior written consent of the other Party except in connection with the sale of all or
substantially all of the business or assets of the assigning Party.
9. Without prejudice to the rights and remedies otherwise available to Connexus, Connexus will be
entitled to equitable relief by way of injunction if there is a breach or threat of a breach of any of the
provisions of this Agreement by the Receiving Party. The Parties agree and acknowledge that damages
would not be an adequate remedy in the event of a breach of this Agreement.
10. This Agreement shall be governed by the laws of the State of Minnesota, excluding its conflict of
law rules.
11. This Agreement may be executed in counterparts, each of which shall be deemed to be an original
and all of which shall constitute one and the same document.
12. The provisions of this Agreement are severable, and if any one or more of such provisions is
determined to be judicially unenforceable, the remaining provisions shall nevertheless be binding and
enforceable.
13. The prevailing party in any dispute or litigation arising in connection with this Agreement shall
be entitled to recover its reasonable attorneys' fees and costs.
above.
IN WITNESS WHEREOF the Parties have signed this Agreement as of the date first set forth
Addresses:
City of Elk River,
for Elk River Municipal Utilities
13069 Orono Parkway
P.O. Box 430
Elk River, MN 55330-0430
Connexus Energy
14601 Ramsey Blvd NW
Ramsey, MN 55303
By: _
Title:
By: _
Title:
Attachment B
Annual Report Powerpoint Presentation To The Elk River City Council -- March 2, 2009
1. Mission Statement
2. Organizational Chart
3. Electric Stats (number of customers by class, sales, revenues, reserves, forecast,
payments/free energy/services provided to City).
4. Water Stats (number of customers, sales, revenues, reserves, forecast).
5. Security Stats (number of customers, sales, revenues)
6. Off-Peak, Wind Power, CIP stats, 2008 residential/commercial rebates
7. Landfill gas electric and wind generation stats.
8. Power supply update
9. ERMU participation in Energy City
10. Major 2008 engineering projects
11.2009 engineering projects scheduled
12. Major 2008 water projects
13. 2009 water projects scheduled
14. Foreclosed/Abandoned homes water shutoff update
15. Major 2008 electric construction projects
16. 2009 electric construction projects scheduled
17. Advantages of municipal ownership