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<br />______________________________________________________________________________ <br /> <br />Page 2 of 2 <br />• Since the March meeting, staff have had several conversations with representatives of <br />Glencoe Light & Power (GLP) regarding the external fuel tanks and approximately <br />10,000 gallons of stored diesel fuel. GLP stated they expect to spend $35,000 to <br />transfer the storage tanks and fuel and another $20,000 to $25,000 to rehab and paint <br />the tanks. These costs will be split between Glencoe and Janesville, another municipal <br />utility, as they will each take one of the tanks. In recognizing these additional costs, <br />ERMU staff has proposed a nominal price of $500 per tank and $1000 for the five-year- <br />old fuel, pending ERMU Commission approval. The revenue will offset the cost to <br />retrofit the external filling station so the engines’ internal day tanks can be filled for <br />demonstration purposes. Our legal counsel at Campbell Knutson has confirmed ERMU <br />can sell directly to another municipal agency without using an open-bid process. <br />• Staff are also in talks with representatives of the Minnesota Municipal Power <br />Association (MMPA) as they are interested in purchasing the plant’s transformer and <br />recloser. Both items are expected to be used in future renewable energy projects <br />supporting ERMU’s service territory. Staff have proposed the equipment be sold at <br />their respective depreciated balances, pending ERMU commission approval. Campbell <br />Knutson has confirmed that MMPA is considered a municipal agency. <br />• Staff will begin pursuing options for marketing the large engines in the coming months. <br />One municipal utility has expressed interest in the largest engine but is not able to take <br />it for three to five years. Updates will be provided as they are available. <br /> <br />Discussion Questions: <br />• Is it acceptable to the Commission to offer equipment assets to peer municipal utilities <br />at potentially below market rate? <br />• Is it acceptable to the Commission to suspend planning efforts on the future of the <br />power plant until after the larger equipment assets presented above are sold and <br />removed? <br /> <br /> <br />ATTACHMENTS: <br />• ERMU Power Plant Renderings <br />100