Bowling Green residents and businesses will pay millions extra above market prices for electricity due to Prairie State Coal Plant
BOWLING GREEN — Wood County Citizens for a Livable Future today released a detailed analysis showing that Bowling Green residents, small businesses, and large users, including BGSU, will have to pay millions of dollars above market prices for electricity if the City continues to obtain electricity from the Prairie State coal plant. The Institute for Energy Economics and Financial Analysis (IEEFA), headquartered in Cleveland, Ohio, prepared the analysis at the request of Citizens for a Livable Future. The report, prepared by IEEFA Director of Resources and Planning Analysis David Schlissel, shows that power from the Prairie State Energy Campus (PSEC) will cost the City of Bowling Green and its ratepayers approximately $118 million more between 2012 and 2021 than buying power from AMP’s Northern Pool and capacity and supporting auxiliary services from the PJM markets. The average residential rate-payer will pay extra $1,870 and the average small business $7800 more. BGSU will pay $17.6 Million more and local employer Southeastern Container will pay $15 Million more.
link to report
These estimates are based on the assumption that the Prairie State plant will operate as efficiently as originally promised and much better than has been achieved so far. If this turns out not to be the case or if carbon taxes are imposed for carbon dioxide pollution produced by the plant, the costs will be much more.
Bowling Green has signed a contract with American Municipal Power (AMP) to receive 50% of its electricity for the next 50 years from the coal-fired Prairie State power plant, located in Southern Illinois. AMP promised the city in 2007 that the plant would provide reliable and affordable electricity, below the market price of power. Bowling Green and other municipalities signed “take or pay” contracts for power from the plant, meaning that the city bears the financial risk for the plant, coal mine, and coal ash disposal. The plant was $1 billion over budget and has had a series of operational problems, all of which have made the electricity significantly more expensive than promised.
David A. Schlissel, Director of Resource Planning Analysis at the Institute for Energy Economics and Financial Analysis prepared the report at the request of Citizens for a Livable Future. Since 1973, Schlissel has served as a consultant, expert witness, and attorney on engineering and economic issues in the fields of energy and the environment. He has been retained by regulatory commissions, environmental groups, consumer advocates, publicly owned utilities, non-utility generators, and governmental agencies states to prepare expert analyses on issues related to electric utilities. He has presented testimony in more than 100 cases before regulatory boards and commissions in 35 states, two federal regulatory agencies, and in state and federal court proceedings.
PDF of press release
Full IEEFA report:
How the high cost of power from Prairie State is affecting Bowling Green Municipal utilities’ customers (pdf)