City explores electricity options
The City of Hebron has not opted out of signing a 20-year contract with Nebraska Public Power District, but it has hired John Krajewski of JK Energy Consulting out of Lincoln to analyze the NPPD contract and compare it to other options for flat fee of $9,000.
Krajewski said Hebron is the sixth city he has consulted. Three of the cities chose to stay with NPPD, which is offering a 20-year contract that does not list prices, but includes a financial performance standard, alluding NPPD will do its best to maintain rates that operate off a national benchmark.
Hebron will receive an economic assessment from Krajewski, who will provide the pros and cons of choosing a power supplier other than NPPD.
He said he is waiting on data from Hebron, and should be finished by the April 1, however, he will spoon information to the council in February and March based on econonomic and non-economic factors.
The gist of it is, no one will know the benefits of either choice until 20 years have passed.
“That’s the reality of it,” he said about the unforeseen events that cause rates to change, such as fuel costs and regulations.
One company vying to provide power to a number of cities and towns in Nebraska is Aksamit Resource Management, which offers a fixed price for energy and demand response or capacity, the company’s contractual permission to use power from the grid.
“Right now, if commodities go up, like fuel, or there is an emergency, those costs go back to the ratepayer. In my opinion, their costs have been a problem,” Phil Pogge of Aksamit said.
Energy and capacity are two of four components needed to honor a power contract. The other two are the cost of running transmission and reliable ancillary services.
“The process is who can offer cheaper power,” Pogge said. “There are a handful of entities that have made the choice to change power suppliers.”
Meanwhile, Nebraska Power to Choose lays out rate increases since 2008 and provides a self-analysis of how much or little resdential and business rates affect customers.
As a state that hasn’t offered competition in power providers, Nebraska climbed from a 6.58 average in 2008 to 8.8 in 2014. Iowa, also non-competitive, went from 6.89 to 8.24.
In competitive arenas, Ohio saw an increase from averages, 8.39 to 9.67 and Michigan, 8.94 to 11.1.
Nebraska Power to Choose advocates for competition and transparent billing because customers should be able to see where rate increases originate.
Most places where privately-generated wholesale power has been adopted, electricity bills have gone down,” Pogge said. “It’s competition.”
Aksamit has also filed for interconnection for its Milligan project in Saline and Fillmore counties and Monument Road wind turbine project in Thayer County, which it says will generate $725 million for economic development from annual payments to landowners, jobs and other monies and provide enough to power 125,000 homes without using Nebraska water.
Interconnection permissions could take several years to come to fruition.
“This would be the biggest economic development project in these counties, perhaps ever. What this could mean in terms of funding for school districts and county governments is very important to future generations,” CEO Gary Aksamit said in a press release.
