Archive for Thursday, July 20, 2006

City’s generators are cranking, saving money

July 20, 2006

It's hot. Temperatures are hovering around the 100 degree mark and the heat index is even worse. That means electrical use is way up, but Baldwin City has the advantage over most cities with the ability to generate its own power.

That's exactly what's going on as both the new power plant on Orange Street and the downtown plant have been providing the needed 9 megawatts the city is using during the day.

"We have been generating for the last seven days, using both plants," said City Administrator Jeff Dingman. "We are generating in the mornings just to 'shave peak' and keep from setting a new demand.

"We are being curtailed by KCPL -- by terms of our agreement with them -- in the afternoons," said Dingman. "Our power plant operators have had a busy week."

KCPL bases its charges for the entire year on peak demand. With Baldwin's ability to keep demand low from KCPL, it means lower rates year around.

"We only get a demand charge if we're bringing power in; we're not charged demand on energy we produce and use ourselves," he said. "So, we spend a little money to generate in the summer months -- mostly for generation fuel and some labor overtime -- but then we're able to benefit from the savings off of the demand charge all year long.

"Doing our 'peak shaving' helps us in that we avoid setting new demand charges and even try to lower our peak demand," said Dingman.

There are other advantages, as well. The city has contracts with other power sources for 5.5 megawatts. By generating its own power, the city has the ability to sell that at a premium.

"We also get the benefit of being able to sell our contracted power either to other members of our power pool or on the open market," he said. "So, by generating our city load, we both shave our peak demand and have the potential to profit by selling our contracted power. That's the idea, anyway."

The city is contracted through KCPL for 5.5 megawatts. The city generates during summer days, but uses that power at other times.

"We're around 9 megawatts now," said Dingman. "The 5.5 megawatts of the contracted power is usually what we use instead of running our plants at night and in the winter months."

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