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June 28, 2010

Utility looks to public for guidance

BY BRIAN McGILLIVARY bmcgillivary@record-eagle.com

TRAVERSE CITY — A proposed biomass power generating plant turned into a public relations fiasco for Traverse City Light & Power and led some officials to question the city-owned utility's future.

The utility board tucked biomass on the back burner during its June 22 meeting, and members indicated they'd instead turn to pursuing power generation with a natural gas-fired plant. But several board members subsequently said they must first determine whether the community would support such a move.

"Is the opposition about local generation, or is it about emissions, or is it about both?" said Mike Coco, chairman of the utility board. "Our board will have to go back and start from scratch and talk with the community to see if it supports local generation."

City Commissioner Jim Carruthers said he's asked environmental group leaders who opposed the biomass plant if they'd back a natural gas-fired facility.

"I want to know if they are truly concerned about environmental issues, or if they just don't want a generating plant in their backyards," Carruthers said. "I think a lot of it has to do with, 'Not in my backyard.'"

Traverse City resident Jeff Gibbs helped lead biomass opposition. He said he was "stunned" at Carruthers' not-in-my-backyard suggestion and said he "should be removed from office."

"We're organizing to stop biomass power in Traverse City, the adjacent communities, the rest of the state, and across the country," Gibbs said.

Gibbs said he doesn't know enough about natural gas electricity generation to offer an opinion, but agreed the community needs to weigh in on whether or not it supports the concept.

"Whether it should go into a neighborhood with schools, a hospital and homes, that's an interesting question," Gibbs said. "The community needs to take that up."

Light & Power wants to replace about 50 percent of its base electricity load, about 30 megawatts, by 2015 when some of its downstate power sources close. Coco said the utility can purchase electricity on the open market, but it's costly and likely will originate from coal-fired plants.

The utility's strategic goals, which members plan to revisit in July, point to local generation, with 30 percent of fuel sources from renewable energy by 2020. Without a biomass plant, utility officials agree it won't reach its 30 percent goal.

The board has to consider the cost to ratepayers, though some biomass opponents said they would be willing to pay more for green energy that's not biomass, Carruthers said.

"There are a lot of people in this town who live on the edge, who struggle to pay their mortgage," Carruthers said.

Light & Power will consider asking its partners in a Kalkaska natural gas plant that kicks on during peak power demands to convert it to base power. It would provide more power, about 50 megawatts, than Light & Power needs. The power also would feed into the statewide power grid before arriving in Traverse City.

John Welch, a Light & Power board member, said local generation makes sense and would allow Traverse City to control its future and offer protection should the power grid fail.

The next test for local generation may involve Light & Power's study of a possible 10 megawatt natural gas-fired plant in Building 52, the old powerhouse at the Grand Traverse Commons.

Power plants burn fuel to create steam that turns electrical turbines. With a 10 megawatt plant, Light & Power would pipe hot water to facilities that have existing hot water heat, and in doing so, double the plant's efficiency.

Several potential customers are based near the Commons, but none exist near the Kalkaska plant, said Ed Rice, Light & Power's executive director.

"It's a significant waste not to use that heat," Rice said.

Carruthers said if the community doesn't want local generation, the city needs to reconfigure its utility board and operations as a power-purchaser.

"If we're not going to generate electricity, if we're just going to purchase it, do we need so many high-priced administrators, do we even need half the current staff?" Carruthers said.

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