Title
Resolution to Approve a Professional Services Agreement with NewGen Strategies and Solutions, LLC, to Complete an Electric Grid Asset Valuation and Municipalization Study ($1,728,000.00)
Memorandum
On January 18, 2022, Ann Arbor City Council requested that the City Administrator, via R-22-017, create a Request for Proposals ("RFP") to formally study the technical, legal, and financial viability of multiple?potential pathways?the City could take to meet its A2ZERO energy-related emissions reduction, clean energy, and equity?goals. The City released this RFP in 2022 and, after reviewing bids, selected a team led by 5 Lakes Energy, LLC to conduct this analysis. In addition to 5 Lakes Energy, LLC, this team included NewGen Strategies and Solutions, LLC, Sunstore, and Potomac Law Group.
In September of 2023, the 5 Lakes Energy, LLC team shared their findings in a report, which included the following recommendations:
* Fulfill 100% renewable electricity by "topping off" with national renewable energy credits ("RECs").
* Pursue Sustainable Energy Utility to accelerate solar development and resilience within the City of Ann Arbor.
* Competitively procure high-quality RECs through virtual power purchase agreements, which can include DTE Voluntary Green Pricing programs.
* Decouple consideration of municipalization from pursuit of 100% renewable electricity, but if interested in pursuing municipalization, acquire renewables that are convertible to municipal utility use.
The report was agnostic on the future of a traditional municipalization effort (i.e., the condemnation and taking of DTE's electrical assets), finding that some taking scenarios could lead to cost savings and some could lead to cost increases for ratepayers. The 5 Lakes Energy, LLC report noted that, should the City be interested in continuing to understand the viability of a traditional municipalization/taking process, a Phase II valuation study would be needed.
In response to this report...
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