“All we can do is hope that it rains.”
City Operations Manager Matt Mueller’s comments during a community meeting earlier this week is about the only answer available to city electric customers who question their higher than usual electric bills.
Mueller said the ongoing drought has halted the generation of low-cost hydropower generation at Grand River Dam Authority in Mayes County where Claremore’s electric supply originates.
GRDA, as a result, announced a positive power cost adjustment in July following an actual rate increase in April of this year. The latest hike was blamed directly on the lack of water for hydro generation at the Pensacola Dam and work at the Holway Pumpback Station near Salina. Other contributing factors include escalating coal costs for coal generation and the high cost
of buying open market power to supplement the shortfall.
Claremore electric customers are not alone. Other area municipalities, like neighboring Pryor, are in the same situation.
City Manager Troy Powell said the city is still working with GRDA under an existing contract. Talk about a new 30-year contract is still on the table.
Powell admits the prospects for finding lower cost electricity anywhere else are dim.
High electric and power costs are a “national phenomenon,” Powell said, and “not just a local problem.
“We went to every public power supplier in this state,” Powell said. Due to Claremore’s existing delivery system, “PSO was our only option, and it was double what GRDA is charging.
“What we found is that GRDA is still the cheapest electricity.”
Powell said one thing the City can do to control further electric increases is control city operations costs.
The majority of the city’s operation dollars (money for salaries, etc.) come from electricity revenue, Powell said. While tax money is collected it is earmarked for specific areas such as streets, alleys, police, fire, parks and now the wastewater treatment plant. Money for city management and operations — nearly 90 percent — comes from electric.
“What we can do is lessen our reliance on electric and other utilities,” Powell said. “We’ve already taken steps to do that.”
Cutbacks in city personnel and realignment of departments have already brought about a nearly $1.4 million savings in city operations costs for the 2006-2007 fiscal year.
For the long term, Powell said Claremore continues to work within a “customer group,” made up of other municipalities who purchase power from GRDA, to work out a contract.
“We will not be signing a contract until we are all comfortable with it,” Powell said.
The city manager said he will be meeting with GRDA’s CEO Kevin Easley later this week.
“GRDA is coming to the table with some things,” Powell said. “I want them to know we want to be a partner and establish a good working relationship.”
In the meantime, the city staff will be taking a “proactive” role by attending all GRDA meetings and seeking leadership roles in both the electric authority and MESO (Municipal Electric Systems of Oklahoma).
Contact Clarice Doyle, email@example.com or 341-1097.