REPORT TO COUNCIL
SUBJECT
Title
Action on an Agreement for Services with Vicki Vanderburg, Inc. dba Power Systems Operations (PSO) for Software License Update and Maintenance of the Validate, Estimate, Reconcile, Allocate (VERA) Settlements Software and Provision of Cloud Hosting [Council Pillar: Deliver and Enhance High Quality Efficient Services and Infrastructure]
Report
BACKGROUND
The City of Santa Clara’s Electric Utility Department, dba Silicon Valley Power (SVP), uses the Validate, Estimate, Reconcile, Allocate (VERA) Settlements software applications for its Power Trading Division’s settlement of transactions that takes place in the California Independent System Operator (CAISO) wholesale market. These settlements are complicated, and dependent on a number of variables that are adjusted over time causing the need to perform adjusted settlements that go back months and years in time. In any given CAISO invoice there will be the current month’s settlement as well as 6 additional monthly adjustments from prior time periods.
The VERA software was designed and written by Power Systems Operations (PSO) for the purpose of validating the CAISO settlements scheduled through Silicon Valley Power’s Scheduling Coordinator Agreement with Northern California Power Agency (NCPA) and for various industry reporting requirements. Approximately $69 million in transactions which were scheduled through the CAISO were validated and settled in CY2019.
Various VERA modules hold all the algorithms/formulas for calculating settlements, there are 235 California Independent System Operator (CAISO) charge code formulas for settling transactions using the CAISO grid. SVP submits around 82,860 schedules per year. These schedules generate 24 settlements per schedule if they are in the CAISO Day Ahead market, or 268 settlements per schedule, if in the CAISO Real-Time market, amounting to millions of settlement interval calculations that must be validated such that invoices can be paid or disputes submitted in a timely manner. The Agreement with PSO supports editing or adding settlement algorithms/formulas as the CAISO introduces market changes.
The VERA Reporter module is used for daily, end of the month transaction validations and to assure data accuracy and integrity. The VERA Administrator also holds the master calendar that tracks with the CAISO multiple month settlement and adjustment process in a manner that validations are aligned with the CAISO, and counterparty invoices. VERA Communicator categorizes the CAISO charge codes into SVP’s Finance Department’s accounting strings for invoice processing, and budget tracking.
DISCUSSION
Through this Agreement, SVP will maintain its software license for the VERA Settlements Software; receive additional technical services, modifications, and support in response to expected changes made by the CAISO; and receive hosting services. By continuing the use of the VERA Settlements Software, SVP assures that PSO is continually available for supporting, evolving and improving this critical product.
ENVIRONMENTAL REVIEW
This action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378(a) as it has no potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment.
FISCAL IMPACT
The total cost of the agreement for services with Vicki Vanderburg, Inc. dba Power System Operations will not exceed $448,300 over a three-year term. Sufficient funds are available in the Electric Department Business Services division’s budget for FY 2019/20 and will be included in the proposed FY 2020/21 budget.
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
Authorize the City Manager to execute an Agreement for Services with Vicki Vanderburg, Inc. dba Power System Operations for the Validate, Estimate, Reconcile, Allocate (VERA) Settlements Software license update, maintenance and cloud hosting.
Staff
Reviewed by: Manuel Pineda, Chief Electric Utility Officer
Approved by: Deanna J. Santana, City Manager
ATTACHMENTS
1. Vicki Vanderburg Agreement1