City utilities hires energy consultant
WILLMAR -- For over a year now, Willmar Municipal Utilities officials have been wondering how new U.S. Environmental Protection Agency standards to cut carbon pollution from new and existing power plants will affect Willmar's 66-year-old coal-fir...
WILLMAR - For over a year now, Willmar Municipal Utilities officials have been wondering how new U.S. Environmental Protection Agency standards to cut carbon pollution from new and existing power plants will affect Willmar’s 66-year-old coal-fired power plant and other local generating resources.
Possible answers to that question will be addressed with assistance from an energy industry consultant hired Monday by the Willmar Municipal Utilities Commission.
The commission approved a contract not to exceed $60,450 with Burns and McDonnell of Kansas City, Missouri.
The consultant will propose a series of scenarios for future local generation based on a number of assumptions, which include fuel costs, EPA rules affecting coal-fired facilities and their associated costs, the impact of new pipelines and global price exposure, and renewable fuels, costs and availability.
Utilities General Manager Wesley Hompe said the study will take into account the utility’s history of generation and reliability requirements, and the utility’s historic commitment to district heating customers.
“It’s going to be a fairly comprehensive look at our generation systems,’’ Hompe said. The utility has six diesel units, two generators in the power plant, and a power plant boiler for the district heating system.
“With all of those pieces and you relate all of the different variables that go along with it, we anticipate having a variety of scenarios from (Burns and McDonnell) that we look at, digest and debate about for the future, which would probably be a 10-year horizon,’’ he continued.
“It’s like any other forecast: if you make it today, it will be wrong tomorrow. But you have to go in some direction,’’ Hompe said. “Apparently Burns and McDonnell have done this for a quite a few other utilities, so they have a fairly good format on how to go about it.’’
The eight- to 12-week study will begin as soon as the utility provides data to the firm.
Commission President Steve Salzer asked Hompe if the study will present alternatives. Hompe said yes.
“They plan to put together more than three and less than 10 scenarios we can look at based on what we have and what the projections are, what we have existing, what we may want to keep, what we may want to modify,’’ said Hompe.
“We can use those assumptions or modify them and see what works for us on our future plans. It’s going to be a strategic planning tool,’’ Hompe said.
He said the EPA announcement against coal “was not a surprise but it was fairly significant and we don’t see that trend reversing or slowing down a whole lot and that will be addressed as part of the results here.’’
The utility in July requested proposals from firms interested in analyzing the future of Willmar’s generating facilities. Bid proposals were received from three firms, were studied by staff, and the low bid of Burns and McDonnell was proposed.
The bid was discussed and proposed by the commission’s Planning Committee, which met Oct. 14, committee Chairman Dan Holtz reported Monday.
Holtz said the analysis will tie into a goal identified by the commission during the 2013 strategic planning session “where we’re really going to look at our local power generation and just kind of map out a direction for our future: what are we going to do here.’’