CU, manufacturers' group at odds over power issues

In an Aug. 26 meeting in the City Utilities Training Center, CU officials and members of Southwest Area Manufacturers Association will discuss options for Springfield's future power supply. As stated in letters to CU General Manager John Twitty, dating back to last November, SAMA and its Executive Director Rita Needham believe alternative power-generating methods exist. They're asking CU to consider them.

But Twitty said such alternatives have already been discussed within CU.

"I assure you that we have studied everything that (SAMA) has suggested, before they suggested it," he said. "That's our job, and we've done our homework."

The biggest concerns for Needham and the nearly 50 member companies of SAMA, representing approximately 4,500 manufacturing jobs, is the timing of expected cost increases.

CU's original proposal to build a 275-megawatt, coal-fired power plant would raise electric rates 16 percent over four years. Springfield's Board of Public Utilities has put that proposal on hold while CU officials consider a partnership with Joplin-based Empire District Electric Company and Omaha, Neb.-based Tenaska Inc. Expected rate increases in the three-way partnership have not been announced. CU already has received approval to raise rates 3 percent in October.

Needham suggests the 16 percent increase could eliminate some area manufacturers and thus threaten jobs.

"Some of these options are delay strategies that could avoid having to present this huge rate increase to voters at a time when the economy has been struggling," she said.

Some of the options to be discussed are:

extending and possibly increasing existing power supply contracts;

considering other independent power producers, such as Tenaska, to partner with;

eliminating growth of CU's territory; and

purchasing excess capacity on the open market.

Twitty expects the final suggestion to receive much attention considering the recent blackout in the northeast that affected more than 50 million customers connected to the nation's transmission grid. While Twitty has confidence in the regional grid servicing CU, he does not want the utility to rely heavily on it.

"We have known for a long time that the transmission system has a lot of failing in it," he said. "This was but another example of that weakness in the basic infrastructure. Much of the reason that we recommended prior approval of Southwest II was because we did not think ... that you could depend upon the transmission system to deliver the kind of energy we're looking at."

CU has three contracts to purchase power from the grid: 51 megawatts from Kansas City Power & Light; 60 megawatts from Grand River Dam Authority in Oklahoma; and up to 50 megawatts from Southwest Power Administration, the U.S. Department of Energy agency that serves this area. Twitty said about 25 percent of energy delivered to CU customers annually comes from these contracts. However, Springfield's plants are capable of generating 100 percent of the power used.

Needham is glad for the opportunity to discuss these issues.

"I want to commend City Utilities and John Twitty in particular about having the openness and willingness to discuss this with us," she said."We have a responsibility to advocate for the manufacturers in this area. ... We're speaking out."