Logansport Mayor Ted Franklin announced the purchase power agreement for a proposed power plant is now final and will be released to the public Friday.
Franklin and Logansport Municipal Utilities Superintendent Paul Hartman said at a press conference April 25 the plant will run on natural gas first with the option of developing a renewable fuel alternative later on.
Franklin added he has been negotiating with Total Concept Solutions Logansport LLC, which was started by a developer out of France. He declined to reveal more about the developer for the time being.
The about 40-page purchase power agreement, or PPA, sets an initial rate of 5.3 cents per kilowatt-hour, Franklin said. Logansport Municipal Utilities, or LMU, customers currently get about 70 percent of their power from Duke Energy at a wholesale rate of about 7 cents per kilowatt-hour and the other 30 percent from LMU’s coal-powered plant on Race Street.
The agreement states this 5.3 cents per kilowatt-hour rate would remain in affect until December 31, 2020. The rate would then start to rise in accordance with the Consumer Price Index, Franklin added.
“I’m very comfortable with that,” Franklin said.
The exact size of the plant is yet to be determined. A 500-megawatt plant is estimated to cost about $803 million, Franklin said, while scenarios continue to be explored through negotiations of a plant requiring an investment of about $3.2 billion. All costs, including those associated with necessary improvements, would fall on the plant’s investors.
Development would require about 1,000 construction workers for at least two years, Franklin continued. LMU’s generating plant’s 31 employees would be hired on at the new plant along with the addition of about 160 others. Workers’ relationship with the American Federation of State, County and Municipal Employees would remain intact as well.
LMU’s average annual load amounts to about 70 megawatts per hour, meaning all excess power generated at the new plant would be sold on the grid. Franklin and Hartman said the PPA states the city and LMU would receive 4 percent of the plant’s gross sales. If a 200-megawatt facility is built and excess power is sold at 6 cents per kilowatt-hour — the smallest likely option — that would bring in a total of more than $4.2 million annually for LMU and the city. If a 2,000-megawatt facility is built and excess power is sold at 10 cents per kilowatt-hour — the largest likely option — that would bring in more than $70 million annually for LMU and the city.