REPORT TO COUNCIL
SUBJECT
Title
Action on Award of Contracts for As-Needed Engineering Support Services to Electric Power Engineers, LLC, Flynn Resource Consultants, Inc., Handran Engineering, Leidos Engineering, LLC, and Power-Tech Engineers, Inc. with an Aggregate Maximum Compensation Not-to-Exceed $15 Million, Inclusive of the Option Year, to be Funded from the Electric Utility Fund and the Electric Utility Capital Fund
Report
BACKGROUND
The City of Santa Clara’s Electric Utility, Silicon Valley Power (SVP), has provided electric service for over 125 years and is experiencing significant continued growth. In response, SVP has developed a capital improvement strategy to address both near-term and long-term load growth.
On September 28, 2021 (RTC # 21-871), the City Council accepted SVP’s Three-Year Growth Plan Strategy, which identified $300 million of proposed projects to install new facilities and replace aging infrastructure with higher capacity infrastructure. On November 15, 2022 (RTC # 22-1172), the City Council accepted SVP’s System Expansion Plan for the California Independent Operator’s (CAISO) Transmission Planning Process (TPP) FY2023/24.
The SVP System Expansion Plan anticipates a peak system load of 819 megawatts (MW) in 2025 and 1,306 MW by 2032. The plan identifies both near-term and ten-year improvements required to maintain electric service reliability in anticipation of the projected load growth. It also provides a technical basis for the analysis, including a summary of proposed projects.
To support the implementation of these initiatives, SVP requires engineering support services focused on system studies, planning, and operational reliability. These services provide technical expertise in the following areas:
• Transmission planning for real-time operations
• System enhancement and expansion transmission planning
• Project scheduling
• Communications engineering (wide area network)
• System operations business planning
• Commissioning and testing support
DISCUSSION
Pursuant to Section 2.105.140(c) of the Santa Clara City Code, a formal Request for Proposals (RFP) was conducted, with the award recommendation based on “best value.”
The RFP for Engineering Support Services was published on the City’s e-procurement system. Six proposals were received and independently evaluated by a three-member evaluation panel based on the criteria and weights published in the RFP, including experience, technical capability, and cost. The evaluation panel determined five of the six proposals met the requirements of the RFP.
Based on the evaluation results, staff recommend entering into five separate agreements with the following firms:
• Electric Power Engineers, LLC
• Flynn Resource Consultants, Inc.
• Handran Engineering
• Leidos Engineering, LLC
• Power-Tech Engineers, Inc.
Each agreement will have a five-year term starting on December 1, 2025, through November 30, 2030, with an option to renew for one additional year through November 30, 2031. Rates are established in each agreement and will remain fixed for the first two years. Thereafter, firms may request rate increases, subject to approval by the City. Any rate adjustments must be substantiated by the firms to the satisfaction of the City.
The scope of services under each agreement includes system-level and operational engineering support, such as transmission and reliability studies, load flow analysis, project scoping, and regulatory submittals required for the CAISO and the North American Electric Reliability Corporation (NERC) compliance. Work under these agreements will be authorized on an as-needed basis through the work-order process aligned with the RFP award process for the actual work and consistent with Purchasing procedures.
Staff recommends entering into each agreement (Attachments 1 to 5) with an initial compensation of $1,000,000 (totaling $5,000,000), with authority delegated to the City Manager to amend each agreement up to an aggregate maximum amount of $15,000,000. This will allow SVP to manage costs in line with actual work requirements while maintaining the ability to respond as project demands increase.
Approval of these proposed agreements will ensure SVP has the technical resources necessary to support transmission planning, system reliability, and regulatory compliance identified in the System Expansion Plan and Three-Year Growth Plan Strategy.
ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to Section 15061(b)(3) of Title 14 of the California Code of Regulation in that it can be seen with certainty that there is no possibility that the proposed actions may have a significant effect on the environment. The environmental impacts of the associated improvement projects have already been separately analyzed.
FISCAL IMPACT
The combined maximum compensation under the proposed agreements is $15,000,000 over the term of the agreements. Sufficient funds are available in the FY 2025/26 Operating Budget in the Electric Utility Operating Fund and may be included in capital project budgets in the Electric Utility Capital Fund where appropriate.
Funds required for the agreements in future years will be included in the proposed budgets for the corresponding years.
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. Authorize the City Manager or designee to negotiate and execute agreements with (i) Electric Power Engineers, LLC, (ii) Flynn Resource Consultants, Inc, (iii) Handran Engineering, (iv) Leidos Engineering, LLC, and (v) Power-Tech Engineers, Inc. for as-needed engineering support services for a five-year term starting on December 1, 2025, and ending on or around November 30, 2030, with an initial maximum compensation of $1,000,000 per agreement for an aggregate amount of $5,000,000, to be funded by the Silicon Valley Power Operating or Capital Fund as applicable, and subject to the review and approval as to form by the City Attorney; and
2. Authorize the City Manager to take any actions as necessary to implement and administer the above agreements, and negotiate and execute amendments to (a) add or delete services consistent with the scope of services, (b) adjust future rates to account for reasonable changes in labor rates, (c) adjust the maximum compensation in each agreement as needed, subject to a total maximum aggregate compensation not-to-exceed $15,000,000 (an increase of $10,000,000) across all five agreements, to be funded by the SVP Operating or Capital Fund as applicable, (d) exercise an option to extend the term of each agreement through November 30, 2031, and (e) make de minimis changes, all subject to the appropriation of funds, and the review and approval as to form by the City Attorney.
Staff
Reviewed by: Nico Procos, Director of Silicon Valley Power
Approved by: Jovan D. Grogan, City Manager