At Tuesday night’s Muscatine Power and Water (MPW) Board of Trustees meeting, the Board of
Trustees heard MPW staff recommendations on fleet vehicle replacements. Two of the vehicles
are all-electric, aligning with the Utility’s strategic plan to further electric vehicle (EV) adoption in

Gage Huston, general manager, explained, “MPW isn’t just preparing the community for EVs,
we are starting to transform our own business practices by incorporating environmentally
responsible solutions for the utility fleet.”

The Trustees were informed that ongoing global supply chain issues continue to impact the
Utility’s vehicle replacement schedule. The current lead time from ordering to receiving often
exceeds 12 months.

To remain on schedule, MPW staff recommended ordering four utility vehicles as soon as
possible to avoid delays and ensure the Utility has adequate resources for utility work. Payment
for the vehicles will not be due until the vehicles are received, so there will be no impact on
2022 cash flow.

Capital estimates to replace the vehicles in 2023 were included in last year’s 10-year financial
projection. The current capital estimates will also be included in the 2023 operating budget,
which will be presented to the Board in October.

Ryan Streck, director of utility service delivery, noted while the up-front costs are a bit higher for
the all-electric option, pricing has become competitive. With the reduced “fuel” cost and lower
anticipated maintenance costs, MPW staff estimates the 10-year total cost of ownership to be
less than a gas-powered alternative.

The collective bargaining agreement (CBA) with the International Brotherhood of Electrical
Workers Local No. 55.10 was recently re-opened to negotiate wages. The 2019-2024 CBA
includes a wage re-opener prior to the close of the third year (2022).

The amicable negotiation represents a positive step forward for the Utility and the Bargaining
Unit (BU). Both sides acknowledged the benefit of the high-level cooperation and support in
working through COVID-19, navigating the changes in power generation operations, and in
completing major projects such as Fiber to the Home and the Line 106 high-voltage
transmission line.

“The Muscatine community benefits from the positive working relationship we have with our
union employees,” said Huston. “The senior leadership team at MPW is proud to have skilled,
knowledgeable and dedicated skilled trade employees working on behalf of the Utility, providing
essential services to our customers.”

MPW is sponsoring the Professional Developers of Iowa (PDI) fall conference September 28-30
at The Merrill Hotel. PDI is comprised of economic development professionals working to grow
and develop Iowa’s economic base. The 300-plus members represent a variety of disciplines
including county and regional developers, community developers, utilities, legal and financial
firms, higher education, engineering, rail transportation and construction firms.

Mark Roberts, director of finance and administrative services, presented the August financial
reports. MPW had its third strong month in a row, with the result that year-to-date net income of
$7.2m was $7.3m above budget and $8.0m above last year. Roberts noted “the 2022 summer
has been much different than expected, with high natural gas prices pushing up wholesale
electricity prices.” He went on to state, “MPW’s coal-fired generation fleet was able to provide
energy to the market at low costs to MPW, with the margins providing substantial benefits to our

For August, Electric utility net income was $2.9m, while the Water and Communications utilities
had net incomes of $132k and $141k, respectively. The Electric and Communications utilities
performed better than budget; however, the Water utility fell $58k short of budgeted net income
due in substantial part to higher water treatment costs. Fluoride, chlorine and phosphate costs
have significantly increased due to inflation and supply chain issues.

In other business, the Board:

  • Approved payment for the August 2022 expenditures and transactions.