MPW takes a leap forward with wind power

December 20, 2013 by  
Filed under Green Energy News

MUSCATINE, Iowa — Officials at Muscatine Power and Water plan to add wind energy to the utility’s arsenal of power production.

Following a closed session to discuss negotiations during Thursday evening’s meeting of the Board of Water, Electric, and Communications Trustees, the board authorized general manager Sal LoBianco to enter into a wind power purchase agreement with Geronimo Wind Energy of Edina, Minn.

The energy will come from a wind farm to be constructed in Jackson County, Minn., and will be equivalent to around 5.5 percent of MPW’s native system energy requirement. The project is expected to be completed and operational in 2015.

MPW and Geronimo have been discussing a wind power purchase deal for months. “This project is the most favorable we’ve been offered in terms of size and cost,” LoBianco said in a prepared statement. “There are many benefits to adding wind energy, including hedging against future regulation of fossil fuels and the resulting costs, adding fuel diversity to MPW’s generation resources, and aligning with our core value of environmental stewardship.”

The addition of wind energy is expected to result in a small increase of all customer rates in the short term after the project is operational.

Financial report

During financial reports at Thursday’s meeting, it was reported that  MPW’s electric utility posted a loss of $235,677; but that’s better than the budgeted loss of $868,775.

A loss of $6,615 was budgeted for the water utility, but instead a net income of $4,118 was realized.

The communications utility was expected to be $8,225 in the red, but it posted a net income of $5,554.

Not all ends well

Two new wells will cost more than estimated. The board approved Revised Project Summary Forms for Well No. 44 at the Main Well Field and Well No. 45 at the Progress Well Field, raising the cost of Well 44 from $300,000 to $551,467 and the cost estimate for Well 45 from $312,375 to $384,302.

The scope of both projects has changed, LoBianco explained. He said modifications at the Well 44 site will require more transmission than anticipated. “We drilled test wells in that area and found it wasn’t the water quality we were after,” he said.

The board also approved a recommendation to receive bids and set public hearings for construction of the two wells.

Write-offs

MPW customers who are behind on their accounts may be in for a break — or not. The board unanimously approved writing off $152,000 of uncollectable customer accounts, but LoBianco said that doesn’t necessarily mean those customers are off the hook. “Even though we write them off, we still try to collect them.

And, he added, “We are fairly successful,” he said.

Goedken departs

After 43 years of serving as board attorney, Duane Goedken attended his last board meeting Thursday. Officials and trustees joined in praising and thanking Goedken for his over four decades of service.

“It has been a privilege and honor to be associated with Muscatine Power and Water,” said Goedken. “One of the things I’ve been impressed with the staff is the pride they have in this organization.”

In other business

  • The board approved payment of expenditures and transactions for November totaling $7,935,667.
  • The board approved changing the March and December 2014 meeting dates from the last Tuesdays of those months to Thursday, March 27, and Thursday, Dec. 18.
  • The board approved the appointment of Trustee Steven Bradford to the MAGIC Governing Board.

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