While Burns & McDonnell finishes the Generation Master Plan for Independence Power & Light, the Independence City Council decided to have the company do an updated rate study, as well.
The council earlier this week unanimously approved the rate study contract for $92,400.
The master energy plan, being conducted Burns & McDonnell for $325,000, is scheduled to be completed this summer. That plan will make recommendations for IPL's energy portfolio, generating capacity and staffing levels and discuss energy-efficiency options. Of particular interest will be recommendations on the Blue Valley Power Plant on Truman Road on the east side of the city, which is due for costly upgrades soon but generates a tiny fraction of the utility's power.
City staff said Burns & McDonnell's proximity and experience with such studies make it best suited for the study, and having it do both studies will make coordination between the two easier. The study is to be completed by the end of September.
Council Member Karen DeLuccie asked if one study might be too co-dependent on another.
“Inherently, we see these as related on one another,” City Manager Zach Walker said. “Power production is a very costly endeavor. We think it will benefit the council in making their final determination.”
IPL's current rates are based on a study completed in 2008 – that included annual increases through 2013. Another rate study was completed by Sawvel in 2015, but the council never approved the recommendations, which included included simplified rate structures and a fixed cost that would have increased the minimum bill.
Walker said that given the rapid changes in the energy industry, circumstances for rate studies would be different even now than three years ago. A management study completed last summer recommended that the 2015 study be updated.
“We're making sure we're providing the council with the most up-to-date information possible,” Walker said.
Council Member Mike Huff said that from his many years in IPL, so many rate studies would call for raising rates.
“My expectation on this is a little different,” he said. “I'm wanting to see ways to make us more competitive, other than a rate increase.”
In general, city staff said Burns & McDonnell's proposed study will simplify existing rates and update all rate structures. Walker said the city's financial stresses but also citizens' fear of rate increases have been made known to the person doing the study.
“There's no predetermined outcome here at all,” Walker said. “It's something they're aware of – where we're at as a community and organization.”
The council also named Larry Porter to the Public Utilities Advisory Board, filling the vacancy created by Blair Wildermuth's recent resignation via several missed meetings.
DeLuccie wanted to table to the vote until May 21 in case past applicants or other candidates could be interviewed. Porter, a longtime former city employee as a meter reader and supervisor, had just applied last week. The council had not re-established a firm policy on interviewing and appointing commission members.
Council Members John Perkins and Tom Van Camp agreed with the need to establish a set policy, but argued for the immediate need to fill the vacancy and to not keep Porter in limbo since his name was on the agenda.
Perkins, Van Camp, Dougherty and Huff (who had requested the appointment) voted against DeLuccie's motion, and Mayor Eileen Weir joined them in approving Porter's appointment.