HILLSBORO—In the grips of the worst cold in decades, on Tuesday evening, Feb. 16, the Hillsboro City Council heard from Mark Chesney of Kansas Power Pool with an update on power and on the city’s power meter reader project.
Chesney said “a heck of a lot” of electricity is generated using natural gas, rather than coal, and gas prices rolled down to electric companies.
Chesney commented the prices of natural gas were “breathtakingly expensive,” while “the sport market price for electricity makes you swallow hard.”
While Hillsboro was not subject to one of the rolling blackouts across the Midwest, Chesney said cities that did experience blackouts had “very little notice. Some cities got between zero and five minutes notice before the power was interrupted and saw a duration of up to 120 minutes. This was not comfortable. It can be explained; it’s not at all comfortable.”
Councilman Brent Driggers asked if this “was a perfect storm” of circumstances. Chesney said it was a “fluke.” However, the council may want to look at its contracts with customers, particularly commercial and industrial users for the ability to potentially curtail use in the event of an emergency. Driggers pressed if Kansas Power Pool had gained any insights regarding the overall power grid.
Chesney said in last week’s situation, “I don’t think there’s much more I would suggest.”
Mayor Lou Thurston asked about sources of electricity generation Kansas Power Pool is considering. With a board meeting scheduled for Feb 18, Chesney did not have an immediate answer. However, he did note “a rather remarkable swing in the pendulum in federal energy policy,” and he was “particularly pleased with the fact that KPP has taken a very unhurried approach to carefully study the economics and operation feasibility of installing natural gas fired generated resources that compliment the intermittency of renewable resources.”
Chesney said renewable energy can account for up to 50% of power generation. However, without the ability to store energy in an effective way, bringing power plants online quickly is the key to balancing renewables and meeting energy demand. Chesney said a new kind of “quick start” power plant can be online “in less than five minutes” and plan to be viable about 18 months after the Kansas Power Pool’s contract with Evergy, formerly Westar, ends in 2022.
Chesney said the new plants “can capture spot-market prices” for electricity and “only run when there is money to be made in the marketplace.” Chesney said it will save between $7 and $9 million per year, as opposed to relying on Evergy. He also noted Kansas Power Pool “is almost completely out of the coal business” when the contract with Evergy ends.
When it came to the Kansas Power Pool meter purchase agreement, the council approved the $187,530 project on a 10-year note. The interest rate on the project will be determined in the summer, as Kansas Power Pool’s bonds come around at the end of June. Brooke Carroll of Kansas Power Pool said the agreement allows the company to purchase the AMI on the city’s behalf, and the power pool is not adding a markup to the price of the project.