Everyone knows that President Bush was reelected on November 2nd but did you know that voters in three municipalities voted to take control of their electric systems? In Rolfe, Iowa (pop. 675), the vote was 182-19, in Wellman, Iowa (pop. 1,393) the vote was 470-159, and in Auburn, New York (pop. 28,574) the vote was 4,726-987 to allow their cities to form municipally-owned power companies. The two Iowa cities already control their natural gas utilities so the move toward electricity should be a natural extension. Auburn voters hope that electricity costs can be cut dramatically through a combination of local control and ownership of the electric distribution system and the development of renewable energy and efficiency projects. The American Public Power Association says that only 46 municipalities have successfully established public power agencies in the last 20 years.
With the passage of the ballot initiative in Auburn, NY, city leaders are examining the feasibility of building some renewable energy projects including a small hydro plant, a landfill gas-to-energy project and wind projects. They believe these new projects will allow them to distribute electricity throughout their city for less than the 13 cents/kWh currently being charged by New York State Electric & Gas Corp. (NYSEG). According to reports, Auburn will soon begin talks with NYSEG to try to buy the investor-owned utility’s wires and poles in Auburn.
The municipal power authority was an initiative in Mayor Tim Lattimore’s re-election campaign. In a public meeting prior to the November 2nd election, Mayor Lattimore argued that taking full control of the electric system was a natural extension for the city since it already has several electric power plants operating including a geothermal system (providing heating and cooling for City Hall and part of Cayuga Community College), landfill gas plant, and two hydroelectric dams. The new agency will recommend and develop alternative energy sources, purchase power on the wholesale market and negotiate with New York State Electric & Gas for the use of substations or transmission facilities.
Rolfe and Wellman, IA
In the midwest, residents in Rolfe and Wellman, Iowa, will be expanding their local control of energy into the electricity sector. Each city currently operates their natural gas utilities. Both communities are currently receiving their electric service from Alliant Energy. News reports indicate that more than a dozen cities in Iowa have been considering taking control of their electric systems since a feasibility study and financial analysis released in 2003 showed that 19 Iowa cities could at least break even and, in some cases, realize substantial savings if they formed municipally-owned utilities. The study was completed by Latham & Associates (Cedar Rapids, IA). The cost was shared by the cities based on their size.
The next step for the two Iowa communities is to start negotiations with Alliant to buy out the investor-owned utilities assets. If a deal is unable to be struck, the cities could take their case to the Iowa Utilities Board.