Complaints on BG electric fail to spark council action

BOWLING GREEN – “Saying he had so far failed to make his point about the cost Bowling Green is paying because of a long-term energy contract, resident Neocles Leontis came prepared to show how deep the bite will be for ratepayers.

Leontis, of the group Citizens for a Livable Future, said a study by The Institute for Energy Economics and Financial Analysis show that the contract with the American Municipal Power will cost city ratepayers $118 million more than market rates from 2012 to 2021.  Leontis wants the city to revisit that contract which was signed in 2007.

Under terms of that contract the city will receive half of its electricity from a coal-fired Prairie State power plant in southern Illinois. The project has proved far more expensive than anticipated. The study claimed the deal will cost the average residential customer an extra $1,870 over that period with small business paying $7,800 more. Bowling Green State University, the city’s biggest electric customer, would pay $17.6 million more. Accenture, a  consulting firm that studied possible cost savings for the university, asserted that the university is paying too much for electricity.”

Written by David DuPont, Sentinel Tribune

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Full IEEFA report and press release

City Council considers complaints about energy expenses

PS-truck-trail

BOWLING GREEN – “The city’s contract with Prairie State Energy Campus and its cost for the city and its residents was discussed at yesterday’s city council meeting.

The city entered into a 50-year contract with Prairie State in 2007, which is operated under American Municipal Power and gives much of the city’s power through coal, as well as some hydroelectric energy.

Resident and University chemistry professor Neocles Leontis voiced his concern with the city’s contract with Prairie State in May and said the city is paying too much to Prairie State for energy, and wishes it would renegotiate or break contract and look elsewhere.

Leontis presented a report which he hoped would make the issue more clear. He requested the Institute for Energy Economics and Financial Analysis, a non-profit organization, to do the report. While Leontis agreed with the report in that Prairie State was costing the city money, he did not completely agree with the numbers.

‘These numbers are really lowball numbers,’ he said. According to the report, the city will be paying an extra $118 million between 2012 and 2021 than if they looked to other suppliers, and Leontis thinks that number could be larger.”

By Seth Weber, The BG News

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Full IEEFA report and press release

Report: How the high cost of power from Prairie State is affecting Bowling Green municipal utilities’ customers

PRESS RELEASE

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)

Prairie State

BOWLING GREEN – “In 2007 the city of Bowling Green contracted with Amp-Ohio, a wholesale power supplier with involvement in a coal generation plant in Illinois known as Prairie State – with the goal of providing long term electric price stability in a volatile energy market. The group, Citizens for a Livable Future, believes this may not be the best plan. Joining us are Dr. Neocles Leontis and Roberta Wade.”

By NW Ohio Journal, WBGU TV, Public Broadcasting Service (PBS)

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Report: Prairie State Power Plant bad business deal

PADUCAH- “The Prairie State Power Plant in southern Illinois was a poor investment for Paducah Power, according to a 32 page report from the Institute for Energy Economics and Financial Analysis.

The report says the promises of a low cost, stable source of electricity from Prairie State are turning out not to be true.  The 17 electric companies who bought into Prairie State, including Paducah Power, won’t see an economic benefit, the reports said, until the late 2030′s or 2040′s.

The original cost of plant construction was estimated at $1.8 billion, but grew to almost $5 billion. The report said power companies should have known the cost was going to increase because almost every coal project had sky-rocketed since 2000.”

By Robert Bradfield, WPSD News Channel 6

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Paducah Power customers upset with high cost of utility bills

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PADUCAH – “Paducah business owner Ronnie Goode is very outspoken about the decision Paducah Power made five years ago to sever ties with the Tennessee Valley Authority.

‘The board has refused to admit that it was a poor decision,’ Goode said as he was reading from a letter to the editor in The Paducah Sun.

Goode calculated his company’s power costs from February 2013 to February of this year.  He said he’s paying 32% more to keep his lights on. He expects his bills to stay high.

‘I don’t see a light at the end of the tunnel. I don’t see but anything getting worse,’ he said.

‘The power rates have really put a hurting on the families,’ said Necie Smith. She is the emergency services coordinator for Paducah Cooperative Ministry.  She oversees PCM’s funds for families looking to pay down their utility bills.  ‘They are not really looking for a hand-out.  They are looking for a hand-up,’ Smith said.”

By Robert Bradfield, WPSD News Channel 6

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Power debate in BG still charged

electric_BG_City_Building.2723_rotator BOWLING GREEN – “Concerns about the city’s electrical contract with an Illinois power facility remained energized Monday night.
Lisa Kochheiser, a member of the local group Citizens for a Livable Future, rose at the meeting and made note of a recent incident at the Prairie State Energy Campus in southern Illinois which damaged the plant.

A press release issued on May 28 by the campus addressed the May 24 incident, saying that ‘a water storage tank overflowed resulting in an unexpectedly high release of steam and water that damaged the siding and associated equipment. All employees and workers on site are safe. No explosion, fire or injuries occurred.’ Damage was reportedly not done to the turbine generator or boiler.

A piece on the website of the Columbia Daily Tribune in Missouri concerning the incident said that ‘a rupture disk for a pressure release system blew off and knocked a large hole in an exterior wall.’

Members of Citizens for a Livable Future have consistently voiced concerns about the Prairie State campus, with whom Bowling Green has a nearly 50-year contract through American Municipal Power, at recent meetings, saying that the contract could cost power customers $48 to $54 million more over the next seven years. They have also voiced other concerns, among them that AMP may have had a conflict of interest in the matter because the city engaged a consultant also used by AMP….

By Peter Kuebeck, Sentinel Tribune 

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Despite stern letter, Schmitz supports Prairie State

“GENEVA – Despite its strong wording, a letter from State Rep. Tim Schmitz, R-Batavia, asking Attorney General Lisa Madigan to investigate Prairie State Energy Campus, the lawmaker said he supports the downstate energy campus.

‘The basis for the letter … was the $300 million in bond money from the state for the project,’ Schmitz said. ‘I don’t care how much anyone else spent.’

Schmitz said the letter reflects his concern regarding cost overruns on the $5 billion project and the impact on participating communities that might have to pass the cost along to ratepayers….

Geneva is a member of – and has a contract with – Northern Illinois Municipal Power Agency for an entitlement share of 35 megawatts in Prairie State Generating Company, which owns Prairie State Energy Campus….”

By Brenda Schory, My Suburban Life

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Delay in disclosure of accident at Prairie State

CLEVELAND — During the Painesville City Council meeting on Monday night, Councilman Andrew Flock called the city’s attention to the accident that occurred at the Prairie State coal plant on May 24th, and questioned whether American Municipal Power (AMP ) has been transparent in its dealings with the city.

Councilman Flock quoted from a memo he received from AMP on May 28th, four days after steam and water blew a hole through Unit 2 of the plant, resulting in both generating units being taken offline.  Councilman Flock stated, “For them to tell me by document that the incident occurred on May 24th and they’re sending a document May 28th does not to me show transparency from AMP-Ohio or Prairie State.”  During the Council meeting, City manager Tony Carson stated that the city was not informed of the accident until the day that Councilman Flock called him about it.

AMP has reported that Unit 1 of the coal burning power plant has been returned to service, and that “Unit 2 will not return to service before June 16th. ” Members of Council expressed their relief that no one was hurt or killed during the accident.   Meanwhile, the longer the unit is down, the less power the plant produces, resulting in expensive electric bills for communities.

Click here to watch the Painesville City Council video (starting around minute 33).

By Sarah Batke, Ohio Citizen Action

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Residents keep pressure on Geneva officials over electric deal

GENEVA – “More residents turned up at the Geneva City Council meeting Monday night to urge the aldermen to ask the Illinois attorney general to investigate the city’s electric deal with Prairie State.

A handful of Geneva residents said they plan to continue to speak out about the deals that locked Geneva, Batavia and other cities into decades-long contracts, now that the costs to the cities have been higher than company representatives originally predicted….

Because much of the operation is protected by confidentiality clauses, there should ‘be an investigation to determine if Geneva was intentionally deceived’ about costs and rate projections, resident Bill Scown said to the council.

The council should urge Illinois Attorney General Lisa Madigan to launch an investigation into whether “Geneva was somehow tricked into signing this deal,” said resident Jean Pierce.

[Mayor Kevin] Burns said there is no evidence of fraud or misinformation in the city’s deal….. He said he’s willing to sit down with any concerned resident to discuss the city’s investment in Prairie State…”

By Alexa Aguilar, The Chicago Tribune

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