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<br />Elk River -=~ <br />Municipal Utilities <br />13069 Orono Parkway • P.O. Box 430 <br />Elk River, MN 55330-0430 <br />April 14, 2009 <br />To: Elk River Municipal Utilities Commission <br />John Dietz <br />Jerry Gumphrey <br />Daryl Thompson <br />From: Vance Zehringer <br />bJ~ <br />Phone: ?63.441.2020 <br />Fax: 763.441.8099 <br />March 09 electric energy use is up 9.1 % compazed to Mazch 08. Minor load growth and <br />colder weather account for this increase. Electric demand for the same period is up by <br />only 6.3% -- this is a positive statistic. Mazch 09 water use is down 17% compared to <br />Mazch 08. <br />Antennas have been installed by Met Council on the Gary Street water tower. The <br />installation is complete. <br />_ Discussions with Central Minnesota Municipal Power Agency (CMMPA) continue as we <br />look for a replacement wholesale power supplier beginning in 2018. According to a <br />number of sources, finding a supplier outside of the municipal power agencies is <br />becoming more difficult because of an overall lack of excess capacity and there are few <br />new facilities on the drawing boazd. This is resulting in shorter contract offers or even <br />refusals to renew between municipal utilities and IOUs such as Xcel or Power <br />Cooperatives such as GRE. This makes Big Stone II an interesting alternative for ERMU. <br />While Connexus Energy is willing to renew our contract, the requirement for ERMU to <br />cease acquiring service territory is paramount in discussions to date. <br />The attached Rate Comparison has been revised to include newly acquired data. Note this <br />yeaz, ERMU has a 4% lower residential rate than Connexus Energy and is neazly the same <br />as Xcel's residential rate. ERMU has a 10% lower small commercial rate than Connexus <br />Energy and is 5% less than Xcel's small commercial rate. Unfortunately, our large <br />commercial rate is still 7% to 9% higher than Connexus Energy and Xcel's lazge <br />commercial rate, but this perennial gap continues to close, and we should continue to <br />work on the issue. <br />Commissioner Thompson and GM Zehringer attended MMUA's Winter Legislative <br />Conference on March 25 & 26. Summaries of some of the more pertinent presentations <br />include "Energy Issues In Minnesota" by William Glahn, Office of Energy Security. He <br />concentrated on Conservation Improvement Programs (CIP) and also on the movement <br />towazds C-BED (community based energy development) programs. MMUA's Position <br />