Lake Worth City Commissioners approved an $850,000 settlement on Tuesday to end the city's lawsuit against the Florida Municipal Power Agency. The settlement must still be accepted by FMPA, the Orlando-based power cooperative that supplies electricity to Lake Worth Utilities. The dispute arose from gas-transmission fees that FMPA quit paying in 2009 after the City Commission voted to end its power-supply agreement with the coop in 2014. The Palm Beach Post has more on the settlement here.
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Construction began this week on Minnkota Power Cooperative’s $312 million, 250-mile transmission line, which will run from Center to Grand Forks, North Dakota. The 345-kilovolt transmission line is the longest line built in North Dakota in more than 30 years and should be completed by the end of 2013. The line will deliver coal-fired power from a plant near Center, which will allow Minnkota to designate an existing transmission line for wind energy. Click here to read more about the ongoing construction.
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Verendrye Electric Cooperative will officially take over the electrical facilities at Minot Air Force Base on June 1. In 2010, the coop was awarded a 50-year federal contract to purchase, maintain and operate the electrical distribution infrastructure on the base. According to Air Force estimates, the contract will be worth nearly $85 million over the 50-year period. The Minot Daily News has more on this story here.
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Florida Municipal Power Agency, an Orlando-based power coop that supplies electricity to City of Lake Worth, has proposed a $850,000 settlement with Lake Worth to end a dispute over natural gas transmission fees. The city board will consider the settlement at its next meeting. Click here for more information.
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The National Rural Utilities Cooperative Finance Corporation (CFC) recently helped Nacogdoches, Texas-based East Texas Electric Cooperative (ETEC) secure $115 million through a syndicated credit facility. CFC and Regions Bank, based in Birmingham, Alabama, participated in a four-year, unsecured revolving credit transaction in which CFC will serve as the administrative agent. ETEC will use the funds to construct a 50-MW biomass plant and a 24-MW hydroelectric facility on the Trinity River near Livingston, Texas. Click here for more.
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As expected, the Public Service Commission of Wisconsin approved a new high-voltage power line that is designed to reduce grid congestion in the Midwest power grid. The Journal Sentinel has more on the project and the approval.
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At a meeting Thursday, the Public Service Commission of Wisconsin was expected to decide whether to approve a power line that would run between Alma and Holmen in western Wisconsin. Northern States Power Company, Dairyland Power Cooperative and WPPI Energy are all working on this $234 million project. Read more here.
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American Municipal Power, Inc., an Ohio coop, sued a company last year for breach of contract and two torts, seeking $97 million in damages per claim. The suit alleges that Bechtel Power Corp. lowballed its estimate of the construction costs for a coal-fired supercritical power plant in Ohio by more than $1 billion, and then unexpectedly raised its estimate by $1 billion, forcing the coop to scrap the project. The judge recently ruled that the facts alleged by the coop support a plausible claim that Bechtel wantonly failed to inform the coop of the price increase in a timely manner, but found the tort claims redundant. For more information about this case, click here.
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Hoosier Energy, a cooperative based in Bloomington, Indiana, will retire a 250-MW coal-fired plant in Petersburg, Indiana, in 2015. Hoosier explained that the costs associated with new and proposed U.S. Environmental Protection Agency rules motivated the company to close the plant. Additional details may be found here.
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East Kentucky Power Cooperative (EKPC) is seeking approval from the Kentucky Public Service Commission to join PJM Interconnection (PJM), a regional transmission organization that coordinates the movement of wholesale electricity in 13 states and the District of Columbia. Citing operational and regulatory constraints, EKPC says PJM membership would allow for more efficient and economic coop operations. Click here for more.
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Basin Electric Power Cooperative, based in Bismarck, North Dakota, is paying nearly $800,000 in new tax revenue to school districts, counties and other governmental entities, which is about $300,000 more than projected by the South Dakota Public Utilities Commission two years ago. Taxes for the $363 million, 108-turbine wind project, located on 40,000 acres in three counties, are based on energy production and are paid in addition to preexisting property taxes. However, power generation from the project has been very strong, and because the taxes are tied to generation, the generation rates may have pushed tax revenues higher. The Daily Republic has the full story here.
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Agriculture Secretary Tom Vilsack has announced that rural electric coops in 10 states will receive loans, worth $334 million total, to install smart grid technologies and make improvements to their facilities. The loans will be provided by the USDA Rural Development's Rural Utilities Service. The new funding includes almost $20 million to install smart grid technologies. In Georgia, Jefferson-based Jackson Electric Membership Corporation will receive a $102.8 million guaranteed loan to build and improve more than 850 miles of distribution line and make other system improvements. Click here for a full list of the rural utilities that will receive USDA funding, which is contingent upon the recipient meeting the terms of the loan agreement.
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Although load growth remains tepid, the various financial ratios that are used to evaluate the financial strength of coops continue to improve. According to the annual Key Ratio Trend Analysis by the National Rural Utilities Cooperative Finance Corporation (CFC), equity as a percent of assets increased to a five-year high of 42.24, percent and payments from consumers remained reliable. See the CFC’s press release for more.
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The Southern Maryland Electric Cooperative (SMECO) announced it anticipates breaking ground on a $100 million transmission project this May, which will feature upgraded line poles able to carry more power with a more aesthetically pleasing appearance. Developers expect a project in-service date of March 2015. Click here for the full story.
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Basin Electric Power Cooperative and Minnkota Power Cooperative have each paid a North Dakota “coal conversion” tax under protest in anticipation of an upcoming vote by North Dakotans regarding whether to abolish property taxes, which would include the coal conversion tax. If approved, the change would apply retroactively to January 1. The coal conversion tax is assessed based on the amount of power produced from coal facilities. Additional details can be found here.
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Three Minnesota cooperatives (Great River Energy, Minnesota Valley Electric Cooperative and Lake Region Electric Cooperative) are participating in a $5 million demonstration project to pay for new smart-grid software in attempts to smooth (and track) their customers’ demand. The Minneapolis Star-Tribune has more on the story.
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According to a report from Standard & Poor’s Research (S&P), the proposed U.S. Environmental Protection Agency (EPA) restrictions on carbon dioxide emissions from new coal plants are unlikely to affect the credit quality of electric cooperatives. The EPA has proposed new emissions restrictions that will require modification at some coal-fired plants. The S&P report predicts that the new regulations will put coal at even more of an economic disadvantage. Click here for the full story.
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Meade-based CMS Electric Cooperative, Inc. and nearby Pratt-based Ninnescah Rural Electric Cooperative, Inc. have both closed deals to become 100-percent borrowers of the National Rural Utilities Cooperative Finance Corporation (CFC). Both coops cited CFC’s high level of customer service and the low interest rates and savings that CFC could provide by refinancing their existing debt as reasons behind this decision. CMS is expected save about $7 million over the life of the new notes. More details about the deals are available here.
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Two Montana senators, Max Baucus and Jon Tester, are asking U.S. Energy Secretary Steven Chu to create a timeline for implementing upgrades to the state's power grid in order to aid cooperatives. The plan, if implemented, would affect the Bonneville Power Administration and the Western Area Power Administration, which serve electric coops that provide electricity to more than 400,000 Montana citizens. To read more about the key issues highlighted by Sens. Baucus and Tester, click here.
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On April 25, the House Appropriations Committee approved by voice vote an amendment to the fiscal 2013 Energy and Water spending bill that blocks funding for proposed changes that would affect power marketing administrations (PMAs) and their customers. In testimony before the House Committee, NRECA CEO Glenn English raised concerns that the proposed plans would impose high costs on PMAs. Energy Secretary Steven Chu had proposed several initiatives, which called for the PMAs to promote renewable energy, serve as research grounds for cyber security technologies, respond to solar flares and design rate structures that encourage the use of electric vehicles. Both political parties were opposed to the directive, arguing that it took PMAs out of their traditional role as power marketers. Click here for more.
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The Rural Energy Savings Program Act (RESPA), sometimes referred to as the Conrad-Lugar Amendment, includes four policy improvements designed to help rural families, farms and small businesses save money on their energy bills. Generally, the proposed legislation: (1) authorizes coops to provide low-interest loans to members for energy efficiency improvements; (2) changes the definition of “biomassed manufacturing” as it relates to the Biorefinery Assistance Program; (3) streamlines rules and provisions of the Biomass Crop Assistance Program; and (4) eliminates the requirement under the Rural Energy for America Program that farmers install an additional meter for onsite power generation. See Sen. Richard Lugar’s press release for more.
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The North Dakota Public Service Commission approved a final route for the state’s largest transmission line project in decades. Minnkota Power Cooperative will construct the 250-mile line from Center, North Dakota, to Grand Forks. The project is estimated to cost approximately $312 million. Construction is expected to be completed by the end of 2013. Click here for the full story.
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The Small Business Credit Availability Act passed the U.S. House of Representatives this week and moves on to the Senate. The bill would revise the Dodd-Frank Act to exempt smaller banks, including those offering financing to rural coops, from certain provisions of the major regulatory reform law. With less red tape and new costs to deal with, smaller banks and similar financial institutions should be able to extend more loans and create jobs. Read more here.
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The Heartland Rural Electric Cooperative is kicking off a program to encourage its customers to save power during the summer peak season. The Peak Savers Program will pay customers $1 for every kilowatt-hour saved during peak hours between July and August. The coop tested this program with a small group last year, but more than 1,000 customers are expected to participate this summer. Click here for more.
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Governors in Georgia, West Virginia, Iowa, Washington and Kentucky have signed copper theft bills into law. The Washington bill was partially vetoed by Gov. Christine Gregoire who objected to the creation of a 24-member task force to study the issue of metal theft and make recommendations to the legislature. Gov. Gregoire did, however, approve the parts of the bill that make it first-degree theft to take metal wire from a utility, including a “consumer-owned utility,” if the resulting property damage is at least $5,000. The new Georgia law prohibits cash payments for these materials, and requires the registration of recyclers and the maintenance of a statewide database. Click here to read more about the content of the newly enacted laws.
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The New York Power Authority (NYPA) Board of Trustees has approved an allocation of 2,300 kilowatts of low-cost power for the Amphenol Aerospace Operations of Sidney, New York. The $20 million incentive package to Amphenol is intended to keep the company in Sidney and save nearly 1,000 jobs. The power allocation request was submitted to NYPA by the Delaware County Electric Cooperative on behalf of Amphenol and will be contingent upon service interconnection between the coop and the Company. Click here for the full story.
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Tri-State Generation and Transmission Association, Inc. has filed suit in the U.S. Court of Appeals for the District of Columbia Circuit, challenging the U.S. Environmental Protection Agency’s new mercury and air-toxics emissions standards for coal-fired power plants. The coop, Colorado's second-largest power utility, serves some 1.5 million customers in Colorado, New Mexico, Wyoming and Nebraska. Tri-State claims the EPA standards, which took effect Monday, will drive up electricity costs because of expensive technology needed to meet the rules. Several other entities, including the American Public Power Association, the National Mining Association and the Utility Air Regulatory Group, have also filed suit. The new emissions standards are the first federal rules that require coal- and oil-fired power plants to limit their emissions of these pollutants. The Denver Business Journal has the full story.
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Electric cooperatives continue to receive high marks from utility customers, according to the latest reading of the American Customer Satisfaction Index. Electric cooperatives collectively earned a score of 81 while investor-owned and municipal utilities each received a score of 76. Natural gas distributor Atmos Energy and gas-and-electric supplier Sempra Energy were the two top-ranking energy utilities. Click here for more.
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Cape and Vineyard Electric Cooperative, a Massachusetts coop, awarded contracts to Broadway Electrical Company, Inc. for 44 solar projects totaling 50 MW. The projects, backed by Rockland Capital, will cost roughly $200 million to complete. A number of obstacles remain, and the interconnection of at least some of the projects will have to be approved by Boston utility NStar. The Cape Cod Times is following this story.
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Power4Georgians, a group of electric cooperatives, signed a letter of intent with Taylor Energy Fund LLC to provide financing for a 40% stake in Plant Washington, an 850-MW, coal-fired facility, after Cobb EMC withdrew from the project early this year. The financing comes at a key time in the project development process. Power4Georgians recently reached an agreement with environmental groups over challenges related to Plant Washington’s air permit. Power4Georgians will still need to obtain additional financing to begin construction. The Telegraph has the full story.
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Mountain View Electric Association’s Big Sandy-Lincoln-Midway transmission line is back online after upgrades were made to improve resilience against storm damage. The improvements were completed in time to serve the irrigation loads expected along the eastern and southern Colorado power path. Read more here.
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The South Mississippi Electric Power Association may enter a power purchase agreement and opt for a minority ownership share in the 2,200-MW expansion of the Virgil C. Summer Nuclear Generating Station in South Carolina. Santee Cooper, South Carolina’s state-owned utility, wants to sell a portion of its interest in the project in response to forecasts of reduced capacity needs in the future. The two-unit project is scheduled to be operational in 2017 and 2018. Click here for more.
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West Oregon Electric Cooperative, Inc., with help from the Federal Emergency Management Agency (FEMA), has found a way to keep the lights on through storms. FEMA’s hazard mitigation funds have helped the coop repair storm-related transmission line damage and install new underground lines. As nonprofit agencies providing essential services, coops are eligible for federal disaster assistance during a presidentially declared disaster. For more information on how to benefit from these funds, read the article here.
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Kit Carson Electric Cooperative recently broke ground on a project to build a 1.5-MW solar field, along with developer Standard Solar, in north-central New Mexico. The coop plans to buy solar output from the new facility under a 25-year agreement. When the solar field comes online, it is expected that every business and residence in that part of New Mexico will be entirely solar-powered. Continue reading here.
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Lake Country Power Cooperative, the electricity supplier for much of rural northeastern Minnesota, is asking its members to vote on how rates should increase to cover a projected $1.5 million shortfall. Unlike other coops in the area, Lake Country Power’s 48,500 customers are often located far off of the main lines. The coop serves an average of only six consumers per mile of line. Lake Country Power will hold several information meetings for members prior to mailing a ballot, which will contain three rate increase options. The Duluth News Tribune has more here.
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A jury awarded $750,000 to a Minnesota dairy farmer for damages caused by stray voltage from the Wright-Hennepin Cooperative Electric Association electric system. The court also determined that electricity may be considered a trespass on property under certain circumstances. Whether the coop will appeal the verdict is not yet known. Click here for more information.
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The renewable energy credits (RECs) associated with renewable energy generation projects in Idaho are in high demand by the utilities that purchase power from the projects and the small power producers that generate it. Kootenai Electric Cooperative is one of many small generators trying to retain the marketable RECs, claiming the RECs are a separate product from the actual power produced. The Spokesman-Review has the full story.
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The Kentucky Public Service Commission (PSC) approved a $3.7 million rate increase for South Kentucky Rural Electric Cooperative Corporation (Kentucky RECC), less than half the amount originally applied for by the coop. Residential and small commercial customers will see an increase in monthly charges, but usage charges will remain the same. Citing current economic strains on consumers, the PSC refused to grant a larger increase, which Kentucky RECC had planned to use for capital credit payments to member-owners. Read more.
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Power4Georgians, a consortium of four Georgia electric membership cooperatives, has reached settlement terms with environmental groups opposed to the development of one of its projects, Plant Washington (an 850-megawatt, coal-fired plant in Sandersville, Georgia). Once the opposition groups sign the settlement, Power4Georgians will have the final state permit for construction of Plant Washington. Under the settlement, Power4Georgians agreed to comply with safeguards for mercury pollution and other air pollutants, forego building another coal-fired plant in Ben Hill County and invest $5 million in energy-efficient and renewable projects. The Telegraph has additional details.
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South Carolina company Pee Dee Electricom, a subsidiary of Pee Dee Electric Cooperative, and Marion County have announced a partnership to build a 50,000-square-foot building in the Marion County Industrial Park. This building will be used to attract industry and jobs to Marion County. Construction is expected to be completed by September. Click here for more.
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An Internal Revenue Service (IRS) change could affect the way that electric coops report capital credits on federal tax forms. The change affects Form 990, which organizations exempt from federal income taxes must file annually to provide their financial information to the government. New language in the instructions of Form 990 states that “patronage dividends paid” by tax-exempt electric coops should be reported as “benefits paid to or for members” (Form 990, part IX, line 4). Uncertainty surrounding this language means that coops should consult their tax advisers. The form is due May 15 for most coops. Read more here.
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Several Western states have faced unpredictable weather this spring, which has caused ongoing challenges for electric coops attempting to keep power flowing to customers. In New Mexico, Springer Electric Cooperative, Inc., has been working to replace at least 150 poles and restore service to about one-third of the coop’s more than 3,000 consumer-members after snow and high winds battered its service territory on April 2. Many coops have experienced damages due to windstorms, such as Montana-based Flathead Electric Cooperative, which faced a loss of power to thousands of members after a March 28 windstorm. Click here for more.
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The Nuclear Regulatory Commission has approved a license for two new nuclear reactors in South Carolina. The new licenses come less than two months after the NRC issued its first new permit in more than 30 years for two units at the Alvin W. Vogtle Nuclear Plant in eastern Georgia. Marvin Fertel, president and CEO of the Nuclear Energy Institute, predicts that there will be an additional 5,600 megawatts of nuclear generating capacity on the Southeast’s electricity grid by the end of the decade. In South Carolina, two new reactors are expected to begin operating in 2017 and 2018 at the Summer plant, which is co-owned by Santee Cooper and South Carolina Gas & Electric. Read more here.
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The National Rural Utilities Cooperative Finance Corporation (CFC) has finalized a $25 million loan sale to KeyBank National Association on behalf of KAMO Power, an Oklahoma-based cooperative. Although CFC has made more than $1 billion in loan sales to Farmer Mac over the past five years, this three-year, unsecured loan is the first loan sale made to a bank. KAMO plans to use the funds for a 345-kV transmission project that will stretch from the northeast corner of Oklahoma into Missouri. Click here for more.
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Arkansas Electric Cooperative Corporation issued a press release yesterday announcing its agreement to purchase 51 MW of wind energy from the Flat Ridge 2 South Wind Farm in Kansas. The project is in the construction phase and is part of a larger 419-MW facility financed by BP and Sempra U.S. Gas & Power. Read more here.
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A large number of civil claims were filed against Bluebonnet Electric Cooperative following a fire in September 2011. Plaintiffs allege that the coop failed to remove dead trees and branches near power lines and that this failure contributed to the fire. A number of pretrial tasks, motions and proceedings are still outstanding, and it is expected the case won’t go to trial until summer 2013 at the earliest. The Bastrop Advertiser is covering this story.
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Coop members have overwhelmingly approved the merger of Humboldt County Rural Electric Cooperative and Midland Power Cooperative. Merged operations are slated to begin in January 2013 under the name Midland Power Cooperative. Supporters of the merger cite it as a means to control operating costs and increase resources. Read more here.
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Historically low natural gas prices have again had a direct impact on electric coop rates. Texas-based Bluebonnet Electric Cooperative has lowered the cost of power for its members for the second time in six months, citing gas costs as the main contributing factor. Natural gas is used to generate about half of the electricity in Texas. (Subscription required for full article.)
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In a filing before the Federal Energy Regulatory Commission (FERC), the National Rural Electric Cooperative Association recently identified significant reliability and safety risks that could be caused by the proposed revised procedures for interconnecting small solar generation with the grid. NRECA requested that FERC reject the Solar Energy Industries Association’s request for blanket amendments to the interconnection procedures in Order No. 2006 (FERC Docket RM12-10). Instead, NRECA suggested that these changes be applied on a case-by-case basis for qualified utilities. For more on the proposed changes to solar interconnection, click here.
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Mohave Electric Cooperative (MEC) is seeking permission from the Arizona Corporation Commission (ACC) to offer its members prepaid electric service. If approved, the service would provide pay-as-you-go service for customers who request it. AARP Arizona has submitted comments to the ACC raising some questions about MEC’s proposal, especially with regard to how the proposed service would apply to customers with medical conditions, such as customers who have life support equipment. MEC has responded that prepaid services would not be offered to people with medical problems who need access to uninterrupted electrical service. The Mohave Daily News has more.
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