CU board authorizes $280M in power supply projects

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The governing board of City Utilities of Springfield has given the green light for up to $280 million in power supply projects.

The Board of Public Utilities on Sept. 26 approved a gas turbine project with a price tag of roughly $210 million and a battery project estimated to cost $75 million, according to a news release.

"Initial funding for these projects is available through operating capital funds with reimbursement provided through various financing alternatives," CU officials said in the release. "CU is also eligible for cost-share provisions through the Inflation Reduction Act, which will reduce the overall cost of the battery project."

The projects are slated to comprise three 50-megawatt gas turbines to be installed at the CU-owned McCartney Generating Station, near Strafford, and 36 MW of battery storage within the CU system.

The gas turbines, which would run on natural gas with a fuel oil backup for emergency events, would be CU's most efficient generators when they come online in February 2027, officials say. The batteries are expected to be put into service by October 2026.

CU officials say the utility organization is responding to required increases in its planning reserve margin, or required power generation capacity, brought about by increasing electric demand, aging power generation units and extreme weather events. CU will be required to maintain a PRM of 36% during winter months, up from 15% now, by 2026, according to the release.

Incoming CU CEO Dwayne Fulk told Springfield Business Journal in August that CU's fiscal 2025 budget includes $200 million for future power supply contingency.

"We have to acquire additional capacity, buy it on the market, to satisfy that requirement,” Fulk said of CU's PRM.