5.8 ERMUSR 10-11-2005 - Laserfiche WebLink

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i 16 Elk River I Municipal Utilities 13069 Orono Parkway phone: 763.441.2020 Elk River,MN 55330 Fax 763 4418099 ' October 4, 2005 ' To: Elk River Municipal Utilities Commission .ferry Takle John Dietz Jim Tralle From: Bryan Adams Subject: 4th Engine/Generator at Landfill ' As you are aware, we are pursuing the installation of the 4th engine/generator at the Elk River Landfill. The cost of this addition is estimated to be $650,000. N The air permit application has been submitted to the MPCA. Preliminary indications are they desire further study which takes more time. Our consultants feel the outcome will not change and a permit will be issued. The Elk River Landfill is also applying for a ' landfill expansion permit, and the MPCA is apparently having difficulty keeping these two permit applications separate. In the process of negotiation with Waste Management, it is apparent they desire more payment for their gas to cover their increased cost. We subsequently ask Great River Energy if the wholesale purchase power price will increase for the 4`h unit. They in response, increased the payment for the 4`h engine which increases the revenue by approximately $1,538,000 over the remaining 16 years of the purchase power contract. The issue now at hand is how we distribute these extra funds back to the 3 parties of Waste Management, Elk River Municipal Utilities and Sherburne County in an equitable fashion. The attached financial pro-forms reflect projected revenue costs and distribution. Description of these pro-forms is as follows: ' Line 12 Existing purchase price of energy y ' Line 35 Proposed purchase price of energy Line 37 Net difference in revenue to be distributed after appropriate expenses have been increased due to addition of 4`h' unit. ' Line 41 Increase in revenue to Waste Management through higher gas price total increase $595,589 I