Wise people learn from the mistakes of others, so they don’t repeat the mistakes, themselves. Will Ohio legislators learn from this lesson (and a multitude of other states and countries)? Let us hope so, for the sake of our businesses and residents…
For Springfield aldermen opposed to the 10-year-old Sierra Club deal that required the city to buy power from two wind farms, December 2018 can’t come fast enough.
By then, both contracts will have expired, at which point City Water, Light and Power estimates it will have spent up to $150 million. So far, the utility has spent about $101 million.
Ward 10 Ald. Ralph Hanauer, who wasn’t on the city council when the deals were approved, calls the wind-power contracts “the most costly mistake in the city of Springfield.” He added that the lack of a clause that allows the restructuring of the contacts to keep costs closer to market value — as just happened with CWLP’s coal contract — was part of the mistake….
The Sierra Club’s wind-power agreement… The 2016 price for both contracts for wind power is $58.97/MWh, according to figures provided by the city.
The variable cost of producing the same power from CWLP’s own generation has been about half that — less than $30/Mwh — over the course of the wind contracts. And the new price in the most recent coal contract makes CWLP’s variable cost of generation even lower — roughly $17 to $26/MWh, depending on the unit….
“Wise economics should determine whether future wind and solar investments are pursued,” McMenamin said. “Generally speaking, going forward, municipally owned electric utilities should concentrate on electricity distribution rather than generation.”…
“At the time, we didn’t realize how devastating it was going to be,” Redpath said.
While walking his ward and talking to the residents, Redpath said he’s run into a lot of people who are opposed to the wind-power contracts.
“There’s definitely a lesson for the future,” he said. “We have to be very, very careful when this contract comes back up. I don’t know how I could vote for it in most any form.”
Source: CWLP shells out $100M-plus for wind power