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After more than five years of contentious negotiations, the Department of Public Utilities and the Department of Energy have reached consensus on renewing the Electric Coordination Agreement. The current contract ends June 30, 2015.
County negotiators were unable to budge DOE on the key change they were asking for: the ability to earn a profit on county assets.
Since the agreement was first signed in 1985, it has been a cost-sharing arrangement, with DOE using approximately 80 percent of the energy and paying that percentage of the costs. Debt service for county-owned generating facilities has been included in those costs.
The county’s goal was to begin charging a fee to recover the remaining value of its assets when the debt on those assets is paid off on June 30, 2015. Los Alamos National Laboratory would still have realized significant savings, since debt service payments have averaged $6 million a year and the proposed fee would have been $2 million a year, the amount of profit DPU believes it can get on the open market.
An agreement to that effect was reached in 2010, but National Nuclear Safety Administration (NNSA) procurement ruled that profit could not be allowed in a reimbursement type contract.
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