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<br /> <br /> <br />Page 1 of 2 <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br />UTILITIES COMMISSION MEETING <br /> <br />TO: <br />Elk River Municipal Utilities Commission <br />John Dietz – Chair <br />Al Nadeau – Vice Chair <br />Daryl Thompson – Trustee <br />FROM: <br />Troy Adams, P.E. – General Manager <br /> <br />MEETING DATE: <br />July 2, 2013 <br />AGENDA ITEM NUMBER: <br />5.5 <br />SUBJECT: <br />Diesel Power Plant Operator Call-Out Provisions <br /> <br />BACKGROUND: <br />Over that past year, staff has worked with Great River Energy (GRE) on revisions to the <br />Capacity Contract for our Diesel Power Plant. The revisions reflect changes to the market as <br />well as changes to how generation is now scheduled with Midcontinent Independent System <br />Operator (MISO). The revision also now has our engines specified as emergency generation. <br />The new MISO capacity market is “year ahead” and we are committed for this MISO planning <br />year covered under our current contract. ERMU will have the opportunity to revise the contract <br />for the next planning year based on our experience this planning year. <br /> <br />DISCUSSION: <br />The contract specifies if MISO call upon GRE for our engines to run, ERMU is required to have <br />them on line within four (4) hours. In the past we have not been called on to run our engines <br />often. The last time we’ve been called to run was in 2006. <br /> <br />The MISO capacity market has significantly changed this year and GRE is working through the <br />details with their contracted generator to make sure we are able to meet the run and reporting <br />requirement. These discussions with GRE have led to ERMU identifying our internal <br />deficiencies relating to our ability to meet our contractual obligations. There is potential for our <br />generation to be call upon afterhours, on a weekend, or on a holiday. Because our power plant is <br />not staffed 24/7, we need to address how we’d meet our requirement to run if we are called upon. <br /> <br />Even with the changes in the MISO capacity market, the likelihood for our generation to run is <br />small. The may run this year, but not often enough to justify the costs for ERMU to has an on- <br />call rotation for power plant operators. Instead, staff proposes an incentive program in the form <br />of a call out stipend specific for the running of the diesel generation afterhours, on weekends, or <br />on holidays. <br /> <br />77