Approximately 70 residents participated in a public forum, hosted by Muscatine Power and Water (MPW), Wednesday, May 19 to discuss goals and objectives resulting from MPW’s Strategic Plan and laying the groundwork for a cleaner future.
“The benefit of completing a comprehensive update to our Strategic Plan is that it gives us a roadmap to best serve our customers”, explained MPW’s General Manager Gage Huston. “Although we don’t have a crystal ball, our Strategic Plan, along with studies and analyses conducted by industry experts, gives us direction to make sound decisions so we can continue to provide cost-effective, reliable energy for decades to come.”
In sharing MPW’s “Power the Future” strategy during the customer forum, Huston noted it sets MPW on the path to continue to meet the energy needs of MPW’s customers reliably, cost-effectively, and with significant environmental improvements.
MPW is pursuing additional renewable energy sources to add to MPW’s energy portfolio and transitioning to cleaner energy. “In keeping with our core value of environmental stewardship, the addition of more renewables into MPW’s energy portfolio makes sense,” shared Huston. “And, decreasing our carbon footprint will have a positive, lasting impact on the environment.”
Huston shared that the best path for consumers is one that maintains MPW’s award winning reliability, assures that MPW rates continue to be affordable, provides flexibility during a time that the electric industry is in a rapid state of change, and furthers MPW’s sustainability initiatives resulting in cleaner air, lower water usage, and other positive impacts on climate factors.
Leaders from local businesses have approached MPW with interest in adding solar to their energy consumption mix. “In addition to business interest, more residential customers are participating in our ‘Choose Green’ renewable energy program. The time appears right to incorporate solar into our energy portfolio.”
Doug White, Director of Power Production and Supply, updated forum participants that MPW staff have been evaluating the addition of 30 megawatts of solar energy locally. Customer interest and commitment will determine how quickly MPW can move forward with a utility-scale solar project.
The solar installation could be constructed in the Grandview Well Field area near the intersection of Highway 61 and Dick Drake Way. The location is already owned by MPW and is also near an existing substation, factors reducing the total cost to add solar. The Utility is exploring an additional 30-megawatt solar installation with the location yet to be determined.
MPW staff investigated the option of generating power using 100% local renewable resources – discovering this choice was the most expensive and least reliable of all scenarios. A solar array spanning over 6,000 acres would be required to meet Muscatine’s energy needs. The array, plus the batteries needed for storage, would cost ratepayers over 1 billion dollars and nearly double electric rates.
Huston highlighted an important distinction, “Adding renewables to the existing system is becoming more and more affordable, but trying to actually transtion the electric system to be fully supported by renewables and storage would be extremely costly and bring significant reliablity risks.”
Although transitioning to 100% renewable supply would reduce carbon emission at a much-accelerated rate, the economic costs and greatly reduced reliability make this an unattractive option for Muscatine.
MPW has relied on “dispatchable” generating resources for the bulk of its power supply since the inception of the Electric Utility in 1922. Dispatchable resources are those that can run as needed to meet energy needs. “Intermittent” generating resources, like wind turbines and solar arrays produce energy when the fuel source is available – either the wind blowing or the sun shining. Because the wind and sun aren’t always “on”, intermittent generating resources are less reliable and full reliance on intermittent generating resources would put Muscatine’s economic future at great risk. “One of the unique attributes of Muscatine is its large industrial presence. For these industries to maintain production, they must be able to rely on us to provide reliable, consistent power,” said Huston. “Everyone at MPW takes this responsibility seriously because we know the positive economic impact these industries and their employees have on our community.”
To meet lofty emission reduction goals MPW set as part of its Strategic Plan, the Utility is performing a detailed evaluation of a phased transition from coal-fired generation to cleaner burning, low-cost natural gas to go along with the increased renewables. This scenario includes the retirement of Units 7, 8, and 8A by the end of 2022, which will reduce MPW’s carbon emissions by 30%. Carbon emissions will be further reduced by 65% by the end of the decade, if a replacement resource for Unit 9 is in place by then. Staff has been thoroughly investigating the replacement of Unit 9 with a more efficient, combined heat and power natural gas unit.
Investigation is continuing, but installation could take place by 2028 if it ultimately works out to be the most viable option. The scenario would still allow for local generation to support Muscatine’s residential, large industrial, and commercial businesses energy needs.
The scenario that provided the best overall results in the study included a new, local natural gas-fired resource that could be part of a Combined Heat and Power (CHP) arrangement. This type of a facility would maximize the efficient use of energy at the site and allow for a continued partnership with one of MPW’s largest customers that has benefitted all electric customers for over 20 years. White explained, “Combined Heat and Power projects are encouraged by the EPA, the Department of Energy, and the Iowa Economic Development Authority due to their efficient use of energy. A project like ours would be somewhat unique and it would continue to set Muscatine as a great example for making the most of the resources we have.”
While these transitions point toward environmental benefits, they bring about some unfortunate negative consequences to MPW staff and the local economy. When fully implemented, the retirement of Units 7, 8, and 8A will negatively impact MPW’s workforce. Approximately 25-30 positions will need to be reduced through a combination of retirements, job transfers, and phased layoffs.
“This decision is gut-wrenching”, said Huston. “We appreciate the years of dedication of all of our Generation staff. Their institutional knowledge of our generating units, pride in maintaining these units, and their service cannot be overstated. Our record of high reliability is, in large part, due to them.”
Despite the significant changes in MPW’s future, Huston emphasized, “The most important message is MPW is here to stay. While the make-up of our power supply is changing, we will continue to honor the commitment made to the citizens of Muscatine nearly 100 years ago to provide reliable, low-cost electricity to our great community.”
Community members are encouraged to visit Powering the Future to learn more about the Utility’s plans and submit questions.