By Dave Edwards
PUC
Back in December of 2005 the “Review” carried a column entitled “Adrian’s Electrical Connections”- a historical piece. It mentioned that “In December of 2003, $880,000 in revenue bonds were sold to purchase a 2000kw diesel generator and axillary equipment, and to make necessary building modifications.” The emergency use generator was test run in April of 2005, and certified for capacity the following month.
It is now 15 years later-177 monthly transfers to satisfy the payments to be exact, and the last payment on that bond issue has just been made! For the first time since the mid 90’s, your utilities are free from bonded indebtedness. Hooray for our side!!
A backward glance shows that since 1996 revenue bonds in the amount of $2,149,660 have been sold to fund public utility projects such as the electrical distribution project of 1996, the water treatment plant in 1998, the Hwy 91 main street project in 1999, and the diesel generation purchase in 2003. All of these bond issues have been retired. The purchase of our emergency use generator would not have been possible without the programs and partnership of Missouri River Energy Services (MRES) – a supplier of power and services to its utility members. To meet their peak power needs. MRES developed a program to assist communities that wished to maintain their generation capabilities AND provide MRES with access to generation when it is needed.
For that availability, MRES has made “reserve capacity” payments to our electric utility. These payments are currently $2.85 per kilowatt ($2.85x2000kw) per month for a monthly total of $5,700. Since June of 2005, the reserve capacity payments from MRES total $897,900. The bond payments (principal and interest) totals $1,294,227. The local share amounted to $396,227. The reserve capacity payments covered 70% of the bond payment. They made the purchase of our emergency use generator possible. We are truly fortunate to have MRES as a partner.
Not long ago a group of elementary students brought their government class to City Hall and participated in a mock City Council Meeting. One of the students asked a question about local generation – “Does the generator run all the time?” A brief discussion about the high cost of diesel fuel served to justify its “emergency use only” status.
A quick look at some actual operating costs show that last April we generated for 48 hours. The CAT diesel consumed 5,000 gallons of fuel at a cost of $2.65 per gallon for a total of $13,250. That comes out to about $10.77 per resident. In April of 2013 we generated for 44 hours- used 4,861 gallons of fuel at $3.45/gallon for a total of $16,770. As originally noted, with that cost it’s for “emergency use only.”
A side note! The old diesel generators ran at about 360 rpm. The CAT diesel spins at 1800rmp. The new generator (15 years old) generates more power than the two large and 2 small units that originally filled the power house, but its horses are thirsty!
What’s next? The reserve capacity agreement with MRES remains in effect as long as the generator meets its certified capacity. The revenue flow will be used to help fund the project planned for the coming summer- the installation of Advanced Metering Infrastructure (AMI) for our electric and water utilities. MRES is again playing a leadership role in the selection and bidding of necessary equipment for the project and in the day-to-day operation of the system when it is up and running. Progress is always easier when you have someone to blaze the trail.
We will have more on the AMI project and its benefits to the utilities and its customers later this spring. Thanks for taking the time.
