REPORT TO COUNCIL
SUBJECT
Title
Action on Software Services Agreement with Power Market Consulting Inc. for OASISLive Subscription Used for California Independent System Operator (CAISO) Congestion Revenue Rights (CRR) Market Participation with Options to Renew for up to Five Additional Years
Report
COUNCIL PILLAR
Deliver and Enhance High Quality Efficient Services and Infrastructure
BACKGROUND
As a participant in the CAISO CRR Market, utilizing the CAISO Open Access Same Time Information System ("OASIS"), the City of Santa Clara’s Electric Utility, Silicon Valley Power (SVP), requires specialized software for:
• Developing market participating strategies using historical and forecasted market data,
• Managing large amount of market transactions data for record keeping and analytical purposes, and
• Creating file templates for uploading into the CAISO user interface as SVP participates in monthly and annual CRR markets.
Since 2009, SVP has used the OASISLive analytical and data management support system (Quantrix Modeler) provided by Power Market Consulting, Inc. (PMCI) for the City’s participation in the CAISO CRR markets. The OASISLive system:
• Is tailored to meet CAISO’s CRR market rules and the City’s established business practices;
• Stores large amounts of public market data and proprietary information related to resource schedules, transmission contracts, and valuation analytics;
• Stores historical data over a long period of time;
• Includes capability for ad hoc CRR and energy market analysis so that users may run queries, perform various calculations using the pre-built matrices, and develop their own analytics using the available data; and
• Is available to staff and consultants from off-site locations
DISCUSSION
The OASISLive solution was originally developed to support the City’s CRR market participation needs in 2009 and continues to evolve as the CAISO’s CRR market rules change. There is a significant amount of City proprietary data and business logic incorporated into the OASISLive system. Therefore, staff does not anticipate changes to this service with the exception of (1) new cloud-based services (Quantrix Enterprise), (2) providing a new short term pricing forecast module in 2022/2023 available both in the existing Quantrix Modeler database and in Quantrix Enterprise and (3) enhanced market intelligence module to enable better tracking of CRR offsets. On this basis, a Sole Source procurement pursuant to Santa Clara purchasing code 2.105.160 was approved by the Purchasing Manager.
In August 2013, the City and PMCI executed a Software Services Agreement. Since then, Software Services Agreement Renewal Notices (Renewal Notice) have been executed annually to extend the term and outline annual subscription fees including rates for other services such as training and consulting. Consulting services include database updates and maintenance, assisting staff with creating new matrices, and transitioning to Software as a Service (Quantrix Enterprise).
Due to several changes in the structure of the service - especially the addition of Software as a Service - staff has negotiated a new Agreement with PMCI which would be effective August 20, 2022.
Staff recommends authorizing the City Manager to execute the Software Services Agreement for the period of August 20, 2022, through August 19, 2026 (Initial Term). In addition, staff recommends authorizing the City Manager to exercise options to extend the Agreement for up to five additional years for a total of nine years. Extensions may be one-year or more years that staff will negotiate at the time that the option is to be exercised.
ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the
California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378 (b)(2) in that the proposed actions are agreements for the purchase of products and services that are continuing maintenance and administrative activities.
FISCAL IMPACT
The maximum compensation for the Initial Term is $1,000,000. PMCI will maintain fixed pricing for that four-year period. Any changes in costs will be associated with changes in the number licenses or subscriptions or use of consulting services.
The total cost if all option years are exercised is estimated not to exceed $3,000,000. Staff’s recommendation includes requests for funding for additional licenses, subscriptions, or additional services resulting from items that are unknown at this time such as market changes, regulatory changes, industry changes, or the known growth in capacity at SVP.
Sufficient funds are available in the FY 2022/23 Operating Budget, in the Electric Utility Operating Fund. Funding for future years will be included in the recommended budget for the corresponding year.
COORDINATION
This report has been coordinated with the Finance Department and City Attorney’s Office.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov <mailto:clerk@santaclaraca.gov>.
RECOMMENDATION
Recommendation
1. Authorize the City Manager to Execute a Software Services Agreement (Agreement) with Power Market Consulting Inc. for OASISLive subscription used for CRR and power market participation in an amount not to exceed $1,000,000 for the four-year initial period;
2. Authorize the City Manager to execute amendments to extend the term of the Agreement for up to five additional years with a total maximum compensation not to exceed $3,000,000; and
3. Authorize the City Manager to amend the Agreement to (a) add or delete services, licenses, subscriptions, and equipment; and (b) allow for future rate adjustments, subject to appropriation of funds.
Staff
Reviewed by: Manuel Pineda, Chief Electric Utility Officer
Approved by: Rajeev Batra, City Manager
ATTACHMENTS
1. Software Services Agreement