Pharos-Tribune

Local News

March 27, 2013

Board takes another look at rate study

LOGANSPORT — Logansport city officials are taking a second look at the rate study that pushed them toward finding a new power source, questioning whether the costs were represented fairly or forecasted accurately.

City Utility Service Board members addressed the author of a financial study done last November to assess Logansport Municipal Utilities’ energy needs at its meeting Tuesday.

LMU and city officials say the motivation behind their pursuit of a waste-to-energy power plant comes from the impending multi-million-dollar upgrades that would be necessary in order to continue buying electricity from its current supplier, Duke Energy, or buying electricity wholesale, as well as future fees that will be imposed on coal-powered plants by the Environmental Protection Agency.

Last November, financial consulting firm Crowe Horwath LLP assessed the alternatives LMU was considering to fill its energy needs based on a report prepared by engineering consulting firm Lutz, Daily & Brain, LLC. The alternatives include redevelopments to LMU’s system like installing new combustion turbines and re-powering existing boilers to handle natural gas. The Crowe Horwath report concludes that each alternative would result in up to a 95 percent increase in utility rates.

Because of the large increase in rates, city officials opted to pursue a developer to invest in building a power plant powered by refuse-derived fuel. City Council voted in favor of entering into negotiations with energy consulting firm Pyrolyzer LLC to develop the plant at its March 4 meeting.

The Crowe Horwath study has been contested recently with the concern that it may have front-loaded many of the costs that should have been spread out over time, leading to the large utility rate increases.

For instance, for an alternative pertaining to performing the necessary upgrades to LMU’s system to keep buying energy from Duke, the engineering report prepared by Lutz, Daily & Brain states the upgrade would cost about $14.25 million, while the financial report prepared by Crowe Horwath adds costs to come up with a total of about $38.7 million, leading to up to a 95 percent increase in rates.

When this point was brought up at Tuesday’s Utility Service Board meeting, John Skomp, a consultant with Crowe Horwath, said the motive was to compare alternatives at “full build-out.”

“We wanted to see when the full alternative was completed, what rates would be,” Skomp said, adding that he could have assessed it year-by-year, but felt it more important to assess a broader idea of what rates would be required to support the alternative.

Utility Service Board Chairman John Davis referred to the alternative in the reports pertaining to switching LMU’s system over to natural gas, which showed an increase in the price for natural gas over time.

“When it jumps up in those future years, one of the assertions that’s been thrown out there several times is that the cost that’s being estimated for purchasing natural gas has been inflated,” Davis said.

Skomp agreed this was a concern of his as well while conducting the Crowe Horwath study, but reminded Utility Service Board members that the figures pertaining to natural gas inflation came from the Lutz, Daily & Brain report, which the board accepted. He added having Lutz, Daily & Brain go into further detail on these figures would have required an additional cost and said he had no reason to think they were inaccurate.

Davis also said at the meeting that he is planning on inviting representatives from the Midwest Independent Transmission System Operator, Inc., the Indiana Municipal Power Agency, the Wabash Valley Power Association and Duke Energy to meet with Utility Service Board members to explore further alternatives for LMU if Pyrolyzer’s proposal doesn’t come to fruition.

Mitchell Kirk is a staff reporter at the Pharos-Tribune. He can be reached at 574-732-5130 or mitchell.kirk@pharostribune.com.

1
Text Only | Photo Reprints
Local News
  • SPT - PT072914 Colts-pic [Duplicate] QB Luck making progress ANDERSON — Wind chill estimates put the temperature at 59 degrees Monday morning at Anderson University.During one stretch of his fifth training camp practice of the year, however, it likely felt much colder to Andrew Luck.The Indianapolis Colts quar

    July 29, 2014 1 Photo

  • District's tire collection effort still going strong If you’ve got old tires, the county still wants them.The Cass County Solid Waste District extended the county-wide tire collection program Monday for the next few weeks — or until the new semi-trailer is full at least.District director Bob Ehle has b

    July 29, 2014

  • Permanent road closure has Miami Co. residents worried PERU — Residents who live near a safety-flare company that’s expanding north of Peru spoke out against a proposal to permanently close a section of county road that runs through the company’s facilities.Orion Safety Products, located at 3157 N. 500 W

    July 29, 2014

  • NWS-PT072914 Legal Services3.jpg Church opens nonprofit immigration clinic She’s worried about her oldest daughter, now almost 18, who’s residing with strangers in Honduras.She talks to her daughter almost daily, she said, but the last time she saw her in person was when her daughter was 7 years old.That’s because she’s und

    July 29, 2014 3 Photos

  • Board approves gravel pit in Walton Homeowners in the area of a proposed gravel pit and other interested Cass County residents packed the commissioners hearing room Monday night to voice their concerns over the pit that local firm Engineering Aggregates Corp. wants to dig, only to have

    July 28, 2014

  • Cass Co. deputies assist in high-speed pursuit

    An Illinois man driving at speeds of 120 mph led officers from three counties on a high-speed chase Sunday before crashing into a utility pole.

    July 28, 2014

  • Illinois man leads police on high-speed chase PERU — An Illinois man driving at speeds of 120 mph led officers from three counties on a high-speed chase Sunday before crashing into a utility pole. Peru police say Isaac K. Hoefling, 31, Lamont, Illinois, was first pulled over by Howard County dep

    July 28, 2014

  • Teachers worry about revamped ISTEP test INDIANAPOLIS (AP) — Indiana teachers heading back to classrooms starting this week are facing the daunting task of preparing students for a standardized test that's been retooled for the third time since 2009. Some teachers and district administrator

    July 28, 2014

  • Police Blotter: July 28, 2014 Have a tip? Anyone with information on a crime is encouraged to call Crime Stoppers at 800-222-TIPS. Information leading to an arrest or conviction could lead to a reward of up to $1,000.

    July 28, 2014

  • NWS-PT072814 McKinley Mortar Work on Logansport senior-living facility continues The transformation of a building on Logansport’s north side that formerly accommodated children is expected to be complete this fall, when it will start catering to those on the other end of life’s timeline.Indianapolis-based Crestline Communities ha

    July 28, 2014 3 Photos

Featured Ads
More pharostribune.com
Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide
AP Video
Kerry: Humanitarian Cease-fire Efforts Continue Raw: Corruption Trial Begins for Former Va Gov. The Carbon Trap: US Exports Global Warming UN Security Council Calls for Gaza Cease-fire Traditional African Dishes Teach Healthy Eating 13 Struck by Lightning on Calif. Beach Baseball Hall of Famers Inducted Israel, Hamas Trade Fire Despite Truce in Gaza Italy's Nibali Set to Win First Tour De France Raw: Shipwrecked Concordia Completes Last Voyage Raw: Sea Turtle Hatchlings Emerge From Nest Raw: Massive Dust Storm Covers Phoenix 12-hour Cease-fire in Gaza Fighting Begins Raw: Bolivian Dancers Attempt to Break Record Raw: Israel, Palestine Supporters Rally in US Raw: Air Algerie Flight 5017 Wreckage Virginia Governor Tours Tornado Aftermath Judge Faces Heat Over Offer to Help Migrant Kids Kangaroo Goes Missing in Oklahoma More M17 Bodies Return, Sanctions on Russia Grow
Parade
Magazine

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.
Poll

Should grocery and convenience stores be allowed to sell cold beer?

Yes
No
Unsure
     View Results
eEdition