6.2. ERMUSR 07-11-2006 - Laserfiche WebLink

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of them would probably be happy to keep the system but contract out the management and operation. • Many small systems (Lanesboro is an example) don't have much in the way of customer programs, and suffer in comparison to the local IOU or co-op. A contract service that provided and administered customer programs would help maintain customer satisfaction with the municipal utility. • We have a number of areas in the state in which there are a lot of small municipals that could easily be operated or managed jointly. The Iron Range, the area south and east of Rochester, and the area around New Ulm and Fairfax are examples. An experienced and capable manager could oversee the operations of several systems, improving their performance and likely saving the utility money at the same time. • A similar program could be established for line crews, which is essentially what MRES is doing for some of its members. An appropriately-sized crew could support several local utilities, improving efficiency and perhaps lowering costs overall. Is it time for MMUA to take a serious look at offering contract management and/or operations services? Gas Agency One of the issues that surfaced during our involvement in the Aquila gas system sale over the past year is the potential benefits of establishing a municipal gas agency in Minnesota. There are a number of services that a gas agency could provide, including: • Provide technical and operations assistance to small gas systems. • Provide contract management and operations services to systems that would like to essentially turn the operations over to someone else. • Provide an existing system that cities considering the development of a municipal gas utility could tap into. (A few years ago, Thief River Falls decided not to exercise abuy-out window in their gas franchise, because they didn't want to take that task on without a support system. Their decision might have been different if there had been an operating gas agency.) • Provide schedule and balancing services for small gas systems. • Provide a mechanism for joint purchase of gas supplies. o Joint purchase should offer benefits due to larger volumes as well as geographic and climate diversity. o The agency could also purchase gas for agencies or municipal utilities that need gas for electric generation. Adding summer generation load to winter heating load would improve the collective load factor and benefit all participants. Under this scenario gas systems would be able to choose the level of service that they want. Our gas circuit rider program might also be transferred over to the agency. 9