Independence's Blue Valley Power Plant, which began operating in 1958, has produced a fraction of energy used by Power & Light consumers.
Even so, the plant has 39 IPL employees, down from the mid-40s a year or two ago. In 2018, 40 employees at Blue Valley were paid nearly $4.5 million in total compensation, including $442,000 in overtime, according to city documents The Examiner requested.
A proposal for replacement capacity from a natural gas plant in Oklahoma, which could lead to Blue Valley closing in mid-2020, is scheduled to be on Monday’s City Council agenda.
If IPL ends production at Blue Valley and maintains its six oil-fueled combustion turbines around the city – used at times of peak demand – analyst reports project it would retain 23 full-time equivalent positions at a cost of about $3.47 million annually, so the estimated staff savings of closing Blue Valley would be about $1 million a year.
Analysts have advised the city the gas-fired Blue Valley plant is near the end of its useful life, barring costly upgrades. But while Blue Valley produced 3.2 percent of the power used by IPL customers last year, because of its membership in the regional Southwest Power Pool the city must replace at least a portion of the plant's 98-megawatt power capacity if indeed the council votes to close the plant's power units.
In some recent years, Blue Valley's production has accounted for even less than 3 percent. But workers are needed to make sure the plant is always ready to go and in good repair if called upon by the power pool, and overtime generally occurs when the plant fires up, said Elaine Kaifes, production operations superintendent at Blue Valley, and IPL General Manager Brenda Hampton.
“Shift supervisors, if we didn't have them here 24/7, we'd have to have a two-day startup time,” Kaifes said. In the latter case, Blue Valley likely wouldn’t be called for production as much, and no production means no chance to recoup any revenues from the SPP, no matter how small. Right now, startup time is about nine hours.
“We've tried to figure out how we can reduce startup times,” Hampton said.
The city is in the power pool to get the benefit of the cheapest electricity at any given time. That helps hold down rates. The Blue Valley plant, being older and less efficient, isn’t called upon as often as many others in the system.
So far this year, Kaifes said, Blue Valley has fired up 15 times – up from seven at this point last year. The plant ran more than 50 times last year, she said.
It's a trade-off, Hampton said, between overtime costs several times per year or hiring more employees.
Indeed, the four operations shift supervisors had far and away the most overtime among Blue Valley employees and are among the plant's more senior employees. But with the plant's limited runs, Hampton said, that's less expensive than making an additional hire and training that person.
Also, she said, if and when Blue Valley is shut down, IPL wouldn't need an additional shift supervisor to oversee the six combustion turbines, which are monitored at Blue Valley).
As an older and thus more expensive operation, Blue Valley normally is far down SPP's chain for power sources it calls on, and Blue Valley running doesn't necessarily mean peak usage in Independence or across the region. It could mean a large power unit somewhere else can't go that day, or the forecast indicates the wind farms won't be active, or the most ideal use of transmission lines across the SPP region involved Blue Valley running.
“We don't always know exactly why we're called to go on,” Kaifes said. “That's why you're ready all the time.”
Added Paul Lampe, system operations manager for IPL, “Within the pool, there's probably a unit out (of service) at all times.
“You have to balance the generation with the load,” he said, adding that SPP is always looking at how to make that work best for a particular day.
On this particular day Blue Valley's 54-megawatt unit is running, along with two combustion turbines off-site. So, the boiler is orange-hot inside, the turbine hums loudly. No production doesn't mean idle time, though, and important repairs that pop-up and get done in-house can also mean some overtime.
“When we're not running, we have all the auxiliary pieces we have to maintain,” Kaifes said. “It's kind of like firefighters, waiting to possibly be called.”
“There's a number of different things we have to monitor,” Hampton said.
That includes the machine parts, computers and even the water used to create steam for generators and also to cool machinery.
“Water quality has to be good,” Lampe said.
The city's decision simply to stop burning coal in 2016 allowed IPL to reduce some staff at Blue Valley, as it takes fewer employees to safely produce power with natural gas, and IPL has tried to make some mechanical adjustments when possible to make the 60-year-old plant run relatively smooth. It's just not the same as working at a 20-year-old plant.
Hampton, who became IPL's general manager late last year, said the employees at Blue Valley have done admirable work considering the plant's age and uncertain future.
“We've made as many changes as we can to be as efficient as possible,” Hampton said. “In some ways, their job is more difficult now.”