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July 22, 2013

DAVIS: Shed some light on the situation

(Continued)

We, as a board, received requests for proposals for an electric system master plan. Once they had been received, we assembled our own team of consultants to review the proposals, and ultimately, we selected Lutz, Daily and Brain Consulting Engineers. The Lutz, Daily and Brain report offered four options, however, a financial review by financial consultants Crowe Horwath, subsequently, indicated that the cost of such a project to the utility and its rate payers was prohibitive.

We then received requests for proposals for an "electric generating plant repowering and expansion project." Of those received, our consultants recommended the Pyrolyzer proposal and the utility board and city council approved the city entering into a memorandum of understanding with Pyrolyzer. Negotiations have been ongoing with a target date of October for a Build Operate Transfer Agreement (BOT) and a Purchase Power Agreement (PPA).

Those who have attended USB meetings know that I have previously requested that we also investigate alternatives while we await the Pyrolyzer negotiations. Specifically, I asked that we investigate the membership in the Indiana Municipal Power Association (IMPA) or Midwest Independent Transmission System Operator (MISO). I believe we must also continue open communication with Duke Energy, our current supplier of purchased power, and that we should also approach Wabash Valley about the potential for purchasing power. Our attorneys have currently indicated that we cannot pursue such discussions until the Pyrolyzer proposal is either terminated or successfully negotiated.

If the negotiations are terminated we will be forced to go in another direction, probably one of those previously discussed. If they are successfully negotiated — and the process is followed that we were assured would be followed — the public should have a number of opportunities to voice its support, questions or concerns. The BOT and PPA documents should come first to the Utility Service Board, then the Logansport City Council and finally, the Logansport Board of Public Works and Safety. I believe the public interest that we have seen in this project has been a positive force and that public input should continue through the review of these agreements.

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