REPORT TO COUNCIL
SUBJECT
Title
Action on Authorizing the City Manager to Negotiate and Execute Agreements and/or Purchase Orders with Vendors for the Purchase of Aluminum Tubular Substation Bus Conductors to be Funded by the Electric Utility Capital Fund
Report
COUNCIL PILLAR
Deliver and Enhance High Quality Efficient Services and Infrastructure
BACKGROUND
The City of Santa Clara’s Electric Utility, Silicon Valley Power (SVP), has provided reliable electric service for over 128 years and is experiencing significant continued growth. SVP has developed a City Council approved Capital Improvement Strategy to address near-term and long-term impacts from potential load growth and aged infrastructure to maintain system reliability.
The key growth projects for the System Expansion Program include:
• Kifer Receiving Station (KRS) Rebuild and Replacement;
• Scott Receiving Station (SRS) Rebuild and Replacement;
• Northern Receiving Station (NRS) Upgrades and Expansion; and,
• Northern Receiving Station (NRS)/Kifer Receiving Station (KRS) 115kV Transmission Line.
As part of SVP’s ongoing efforts to support system expansion and address load growth, a series of purchases have been made and are in progress to ensure that the necessary equipment and materials are delivered to meet project schedules.
DISCUSSION
In alignment with the City Council’s actions on the System Expansion Program, staff is now seeking approval to negotiate and execute agreements and/or purchase orders for the purchase of aluminum tubular substation bus conductors for the NRS project. These bus conductors are used to connect equipment like transformers, circuit breakers, and other substation components, facilitating the efficient flow of power.
On April 9, 2025, staff issued a Request for Bid (RFB) for Aluminum Tubular Substation Bus Conductors for the NRS project, which was published on the City’s e-procurement system. In addition, the City contacted several firms directly, informing them of the RFB and directing them to the e-procurement system if interested. This procurement is currently out for bidding and bids are due May 21, 2025.
City staff intends to award the procurement of aluminum tubular substation bus conductors in accordance with Section 2.105.140(d) of the Santa Clara City Code (City Code). This section requires the City to award the contract to the lowest responsible and responsive bidder.
Description and Quantities
The following table outlines the specific items and quantities required for the procurement of Aluminum Tubular Substation Bus Conductors to support SVP’s expansion project at NRS:
Table 1: NRS Aluminum Tubular Substation Bus Conductors
|
Aluminum Tubular Substation Bus Conductors |
NRS Qty (ft.) |
|
3 1/2" IPS ALUM TUBING, 6063-T6 SCHEDULE 40, 40'-0" Length (For 230kV) per ASTM B241-22 |
640 |
|
6" IPS ALUM TUBING, 6063-T6 SCHEDULE 80, 40'-0" Length (For 230kV) per ASTM B241-22 |
920 |
|
5" IPS ALUM TUBING, 6063-T6 SCHEDULE 40, 40'-0" Length (For 230kV) per ASTM B241-22 |
1520 |
|
TUBE, AL, 8" SPS SCHEDULE 40, 6063-T6, 40'-0" Length (For 115kV) per ASTM B241-22 |
1840 |
|
TUBE, AL, 6" SPS SCHEDULE 80, 6063-T6, 40'-0" Length (For 115kV) per ASTM B241-22 |
3080 |
|
TUBE, AL, 3" SPS SCHEDULE 80, 6063-T6, 40'-0" Length (For 115kV) per ASTM B241-22 |
1720 |
|
TUBE, AL, 6" SPS SCHEDULE 80, 6063-T6, 40'-0" Length (For 60kV) per ASTM B241-22 |
3200 |
|
TUBE, AL, 5" SPS SCHEDULE 40, 6063-T6, 40'-0" Length (For 60kV) per ASTM B241-22 |
320 |
|
TUBE, AL, 8" SPS SCHEDULE 80, 6063-T6, 40'-0" Length (For 60kV) per ASTM B241-22 |
480 |
|
TUBE, AL, 3" SPS SCHEDULE 80, 6063-T6, 40'-0" Length (For 60kV) per ASTM B241-22 |
1680 |
Summary
Subject to compliance with Chapter 2.105 of the City Code, staff is seeking authorization from the City Council to allow the City Manager to negotiate and execute agreements and/or purchase orders for aluminum tubular substation bus conductors, up to a total maximum aggregate amount of $900,000 plus a fifteen percent (15%) contingency, inclusive of applicable taxes but excluding any costs associated with tariffs. As staff does not know the impact of tariffs on the cost of the bus conductors, City staff is asking for additional authority to negotiate such amounts and exclude any tariff related cost from the maximum compensation. The requested authorization is subject to the review and approval as to form of all agreements and/or purchase orders by the City Attorney and the appropriation of funds.
Delivery Timeline
Deliveries are expected to take place in September 2025. Payments will be based on the successful completion of key milestones. A minimum of 10% of the contract amount will be withheld until the City’s final acceptance of the equipment. A two-year warranty period is anticipated to cover parts and labor and will commence upon final acceptance of each unit.
Additional Quantities
As part of the expansion, SVP may need to purchase additional bus conductors, subject to the maximum compensation limit. If such purchases are necessary, they will be made pursuant to Section 2.105.130 of the City Code. This section provides that the Purchasing Division Manager may purchase additional quantities after the initial award of a contract or purchase order for products.
ENVIRONMENTAL REVIEW
The actions being considered do not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to section 15378(b)(2) of Title 14 of the California Code of Regulations as the proposed actions solely involve the purchase of equipment for the Northern Receiving Station (NRS) project.
FISCAL IMPACT
The amount to be paid to the Vendor(s) under the Agreement(s) is not-to-exceed $900,000 for the initial quantity of units noted in Table 1 and an additional $135,000 for a 15% contingency of the total contract value for a total maximum authorization not to exceed $1,035,000. Sufficient appropriations are available in the Electric Utility Capital Fund for the NRS Upgrades and Expansion project. On September 10, 2024, the City Council approved the issuance of electric revenue bonds which provide funding for the System Expansion Plan projects.
COORDINATION
This report has been coordinated with the Finance Department and the 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 or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
1. Subject to compliance with Chapter 2.105 of the City Code, review and approval as to form by the City Attorney, and appropriation of funds, authorize the City Manager or designee to negotiate and execute agreements or purchase orders with vendors for aluminum tubular substation bus conductors for the Northern Receiving Station (NRS) project for a maximum compensation of $900,000, plus a 15% contingency ($135,000), for a total maximum compensation not to exceed of $1,035,000 (inclusive of applicable taxes but exclusive of any applicable tariffs);
2. Authorize the City Manager or designee to negotiate and pay any tariff increases imposed on the bus conductors up to 150% of the total maximum compensation; and
3. Authorize the City Manager or designee to (a) take any actions as necessary to implement and administer the agreements and/or purchase orders, and (b) negotiate and execute amendments for (i) design changes, (ii) any unanticipated issues, (iii) tariff increases, (iii) term extensions, (iv) de minimis revisions, or (v) the purchase of additional bus conductors, subject to the above maximum aggregate compensation limit, appropriation of funds, and the review and approval as to form by the City Attorney.
Staff
Reviewed by: Nico Procos, Acting Director of Electric Utility
Approved by: Jovan D. Grogan, City Manager