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Expatriate 
Group: Members
Posts: 16786
Joined: Oct. 2004
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Posted on: Sep. 13 2013,8:52 am |
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Alliant Energy Corp. ( LNT ) inked agreements to shed its Minnesota electric and natural gas distribution operations for a total consideration of $128.0 million
http://www.nasdaq.com/article...m272580
What’s the real story here, has that White Elephant (Bent Tree} dragged Alliant under?
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History is no more than the lies agreed upon by the victors.
~NAPOLEON BONAPARTE
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| Post Number: 2
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Alfy Packer
Group: Members
Posts: 1197
Joined: Dec. 2004
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Posted on: Sep. 13 2013,10:04 am |
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In the last rate case that went before the PUC it became apparent the Alliant had made several bad deals, that had gone against the utility, which they wanted the public to pay for. Unfortunately the PUC didn't agree entirely with Alliant and after first agreeing to interim rates that Alliant had requested, rolled those rates back substantially.
If you read the press release, one will see that although the distribution business will be sold to a group of co-ops, Alliant will still wholesale electricity to the group distributing electricity to our homes, schools, and businesses. I think this mean that being that Freeborn Mower is a co-op, and Alliant will become a wholesaler the PUC will no longer have a say in the rates we pay. I think as electric consumers we all should be worried!
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| Post Number: 3
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Expatriate
Group: Members
Posts: 16786
Joined: Oct. 2004
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Posted on: Sep. 13 2013,10:46 am |
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Alliant has given Southern Minnesota Energy Cooperative (SMEC) a ten year contract for firm power. load undisclosed.
SMEC is an REA cooperative without any meaningful generation capability although they hold rights on Government Subsidized
power they purchase power through Heartland Power.
Every time the temperature hits 85 degrees the REA is flooding the radio with energy alerts, this tells me they’ve surpassed their purchase
agreement and are forced to buy on the open market, Midwest ISO (MISO) the grid saw thousand dollar Megawatts
in August!
Heartland Power Resources
QUOTE In order to meet the growing needs of our customers, Heartland maintains a diverse power supply portfolio. Our baseload resources include coal-fired generation from Whelan Energy Center Unit 2 near Hastings, Nebraska, and Laramie River Station near Wheatland, Wyoming. Renewable energy generated at Wessington Springs Wind Energy Center near Wessington Springs, South Dakota, accounts for 16% of Heartland's power supply, surpassing South Dakota's voluntary renewable energy standard of 10% by 2014. Other resources include nuclear power generated at Cooper Nuclear Station near Brownville, Nebraska, and peaking sources located in our customer communities.
Our power is delivered over the Integrated System (IS), a high-voltage transmission system that covers a seven-state area and consists of over 9,300 miles of line. Heartland jointly owns the IS with Western Area Power Administration and Basin Electric Power Cooperative.
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History is no more than the lies agreed upon by the victors.
~NAPOLEON BONAPARTE
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| Post Number: 4
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Expatriate
Group: Members
Posts: 16786
Joined: Oct. 2004
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Posted on: Sep. 13 2013,10:12 pm |
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I don’t think the REA will Enron Albert Lea but I do see it as missed opportunity for Albert Lea to take charge of it’s own electrical and gas utilities.
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History is no more than the lies agreed upon by the victors.
~NAPOLEON BONAPARTE
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nzeroesc
Group: Super Administrators
Posts: 258
Joined: Aug. 2005
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Posted on: Sep. 14 2013,10:55 am |
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So you are suggesting a format similar to Austin, or any other city owned utility, where the "profits" of a not-for-profit entity are transferred directly to the general fund of the controlling city, specifically Albert Lea in this case?  Are you nuts? Give them one more avenue to milk us dry.
Or in the current proposed situation, your new utility provider would be a not-for-profit entity where the profits are returned to you the member owner, lowering your electric costs in the most direct way possible. And also it is you who has a voice and a say in the direction and operation of the cooperative.
Last year Austin retained $1.6 million dollars "profit" to their general fund from utility operation. If you take that and divide it out by the census numbers of households, which is artificially high due to multi-unit housing, using the number of 10398 occupied households in the city of Austin, that gives you ~$154 of individual household profits to the utility. Compare that with property tax numbers for Mower and Freeborn County. Median real estate taxes paid over a 5 year average from 2006-2010 for Freeborn County were $1,127 +/- 36, and Mower was $948 +/- 28. Add the $154 dollars of property taxes back to Austins numbers and you end up well within the margin of error for the differences between the two. So are Austins property taxes really that much lower than ours or are the numbers just shifted somewhere else?
I personally look forward to this and hope it is approved. I want to be in control of my utility usage and have the transparency and knowledge that my usage impacts my returns more directly, and I am not paying for our cities repeated bungled decisions.
*Sources:
Property Tax Lookup - taxfoundation.org - The Tax Foundation is a non-partisan tax research group based in Washington, D.C.
US Census 2007-2011 American Community Survey 5-Year Estimates
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Expatriate
Group: Members
Posts: 16786
Joined: Oct. 2004
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Posted on: Sep. 14 2013,12:26 pm |
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I would rather see decisions about Albert Lea’s future power needs made by a public utility under the city’s jurisdiction and not subject to 12 member REA association’s decision that holds no allegiance to Albert Lea.
Albert Lea is dead in the water, once smaller communities who have control over their Utilities have left Albert Lea in the dust Owatonna, Faribault, New Ulm to name a few!
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History is no more than the lies agreed upon by the victors.
~NAPOLEON BONAPARTE
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| Post Number: 7
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nzeroesc
Group: Super Administrators
Posts: 258
Joined: Aug. 2005
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Posted on: Sep. 14 2013,1:23 pm |
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And again I ask that are you really considering who you are placing that trust in by saying you want the city to make those decisions?
While I think you are right to be distrusting of any "new" company or market approach, I think you may be mis-coloring the facts a bit. While the Tribune and other articles about the sale painted the FMCS as being in a group of other southern MN cooperatives, my understanding is that was for no other purpose than to close the sale of Alliant to each separate cooperative service area. You are right that they don't have an interest in Albert Lea alone, but primarily Freeborn and Mower counties, and with the completed sale, Albert Lea alone will make up a large percentage of their overall customer interests.
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| Post Number: 8
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Expatriate
Group: Members
Posts: 16786
Joined: Oct. 2004
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Posted on: Sep. 15 2013,11:27 am |
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Electricity prices can be volatile, these co-ops have band together for monetary reason, they will approach Heartland with their new megawatt load and try to negotiate a long term contract.
Purchasing Alliant Energy and forming the electricity-buying partnership will give the co-ops the ability to cut cost and spread risk.
Here’s Albert lea’s problem, let’s say Dorman lucks out and hooks up with a heavy industry looking to build in Minnesota requiring a 4 or 5 MWH load, the City can’t say sure thing no problem to the prospective industry they have to call Freeborn-Mower, well they have call a meeting of the 12 co-ops, IF they agree they have to call a meeting with Heartland or Alliant to renegotiate their long-term contract, maybe this contract isn’t as favorable because of increased electrical price do you think these co-ops some a hundred miles away will vote for or against Albert Lea’s interests. This whole process could take months to give the prospective industry an answer.
At the same time this prospective industry is looking at Austin, Owatonna, Rochester, Faribault that all give the prospective at the initial meeting five megawatts an hour no problem.
If the REA could beat the price of the other Utilities that would be a plus, but the REA is a retailer not a wholesaler, they don’t own any real generation just a little peaking (spendy power)!
Time will tell I hope it proves me wrong!
The 12 co-ops include Brown County REA, BENCO Electric Cooperative, Federated Rural Electric, Freeborn-Mower Cooperative Services, Minnesota Valley Electric Cooperative, Nobles Cooperative Electric, People’s Energy Cooperative, Redwood Electric Cooperative, Sioux Valley Energy, South Central Electric Association, Steele-Waseca Cooperative Electric, and Tri-County Electric Cooperative.
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History is no more than the lies agreed upon by the victors.
~NAPOLEON BONAPARTE
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| Post Number: 9
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nzeroesc
Group: Super Administrators
Posts: 258
Joined: Aug. 2005
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Posted on: Sep. 15 2013,8:47 pm |
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Except here is the rub in your theory. FMCS purchases the bulk of thier power from Dairyland and will probably continue to do so as far as the majority of the customer base is concerned. Dairyland is wholly owned by the same member cooperatives that it serves. Seems kind of defeatest to screw your owners for short term gains. Yes I understand about double profiting but thats only going to get you so far. I am sure the agreement to purchase only concerns the absorbed service areas and will be amortized over the entire service area.
Now to touch on your comparison between us and other cities in the region with public utilities that can give such a quick answer as you say.
Owatonna, per their own information... Owatonna Public Utilities is a member of the Southern Minnesota Municipal Power Agency (SMMPA) from which it purchases all of its electricity. Learn more about SMMPA on their website.
Austin, per the annual statement... The Austin Utilities purchases power from Southern Minnesota Municipal Power Agency (SMMPA) under a power sales contract, which extends to April 1, 2030. Under the terms of this contract, the Utilities is obligated to buy all the electrical power and energy needed to operate the electric utility.
Rochester... same thing, same supplier, same situation.
Faribault - I think you left the reservation at this point. Xcel serves the City of Faribault. Unless you are referring to the Faribault Energy Park there. Yeah that's owned by yet another municipal power cooperative. MMPA. They sell power to most cities north and west of the Metro, and South St Paul.
Pretty sure none of the cities you named are going to have a magic 5 minute answer for anyone in any meeting. And going back to the original proposal of Albert Lea having their own control instead of FMCS. I suppose we could build a power plant on the Blazing Star Landing and really light that puppy up. Otherwise we would be in the same boat every other city is in, still buying wholesale and selling retail to residents. Aside from the fact that we own a giant water treatment plant we built for a non-existent employer. Anyone remember how long the city dicked around Mrs. Gerrys and Select Foods on their expansions when it came to increased waste water discharge? Or care to recall the pleasant changes we all experienced when the city "adjusted" water and sewer rates to absorb the maintenance costs of the underused facility? See them going down again anytime soon?
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| Post Number: 10
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Expatriate
Group: Members
Posts: 16786
Joined: Oct. 2004
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Posted on: Sep. 15 2013,11:46 pm |
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It’s a moot point, it’s the REA or candles, the city will rollover as usual.
Whenever the REA runs short of power which is frequently they advertise using Heartlands name, Heartland is a bigger player than Dairyland, but they may well have contracts with both. Don’t believe what you read in bios they’re often incomplete.
Those are city owned utilities those plants were bought and paid for by the city, or should I say profits made by those plants, they may have united under SMMPA, they maybe contracted for a certain load but they can and do make decisions independently! I thought Faribault owned a piece of that gas turbine but I could be wrong.
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History is no more than the lies agreed upon by the victors.
~NAPOLEON BONAPARTE
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