Power plant options on the table
Independence’s Public Utilities Advisory Board wants city staff to consider possible future Power & Light energy sources in the near future, particularly with the uncertain future of IPL’s combustion turbines.
A PUAB majority last week approved a recommendation “to determine the most cost effective and reliable source of energy for the rate payers of IPL in the future.” While the recommendation did not specifically state it, a new power plant in some form could be considered such a source.
The recommendation offered by board member Mark McDonald initially read that such action “would include discontinuing the current combustion turbine operations” and seek base load solutions within regulations of the Southwest Power Pool, the city’s wholesale power broker. Fellow board member Jack Looney offered to change the phrase to begin with “may include.”
“I think it’s inappropriate to say what we’re asking to be determined,” Looney said.
Board members Larry Porter, Joe Zsak and David McDowell joined McDonald and Looney, while Garland Land voted no and Bridget McCandless abstained, saying that as a newer board member she didn’t have the background information from prior discussions to make an informed vote.
McDonald said his recommendation, which will be forward to the City Council, is “to get the ball rolling” and open the possibility for a way the city could “sell energy and possibly enjoy income.”
“We need to be looking for the future,” he said. “The reliance on coal is subject to change very quickly.”
When Land asked if by base load power McDonald meant building a new power plant, McDonald said, “I’m talking about just finding what’s available, something you can count on.
“The engineers would know more about (the best solution) than I would.”
“The way it’s worded leaves it open to opportunity,” Looney added.
Independence’s six combustion turbines account for 93 megawatts of power capacity, most of which is necessary for IPL to satisfy its capacity requirements with the Southwest Power Pool. However, they’re mostly peaking stations and provide just a fraction of the energy actually used by IPL customers.
A consultant’s report last year said the turbines, all at least 45 years old, have been maintained well and can be viable a couple years or longer, but necessary maintenance would quickly get expensive – nearly $47 million if done for 10 years. The same report showed estimates that a natural gas plant for similar capacity would ultimately cost more than $100 million.
The PUAB approved a similar recommendation from McDonald a year ago after that report – to discontinue using the six combustion turbines after the city finds an alternative, and ideally cheaper, power source – though the city has taken no notable action since. That recommendation came shortly after the city completed a process for a 10-year contract for 45 megawatts from a natural gas plant in Oklahoma, Oneta, allowing the city to close the Blue Valley Power Plant.
City Council Member Mike Huff said earlier this year that, with interest for bonds at historic lows, the city could consider buying into a more permanent power source or perhaps building one to fill some capacity requirements. What self-owned power isn’t used could be sold, he said.
Such a discussion should happen sooner rather than later to help assure the city’s power supply, Huff said.
“The can’s flat and rusted and can’t be kicked too much longer,” he said.
Huff’s remarks came about the same time Evergy (from the Kansas City Power & Light and Westar merger) revealed plans to possibly retire its coal plants early. IPL has a contract through 2050 for 52 megawatts of power from the Iatan 2 power plant near Weston, which was built in 2010 by KCPL. It is the company’s newest coal plant, and that agreement covers 26 percent of IPL’s purchased power.
The city utility also has a 40-year agreement with the Nebraska City plant owned by Omaha Public Power District for 57 megawatts.
Jim Nail, director of IPL, said that while coal plants are slowly being phased out around the country, the Nebraska City and Iatan plants are two of the newest, cost-efficient coal plants.
“From our contacts both at Evergy and Omaha,” Nail said, “neither of those are on the table for early retirement.”
“As far as we know, those contracts are stable.”