Great Falls Tribune

 

February 4, 2009

 

City votes to accept blended rate for energy

By ZACHARY FRANZ
Tribune Staff Writer

Great Falls city commissioners Tuesday accepted an offer for a new energy rate that, at least for now, is cheaper.

After months of postponing the decision, the commission voted 4-1 to accept the offer of a "blended rate" that Southern Montana Electric Generation & Transmission Cooperative offered in August.

The blended rate includes low-cost federal power and electricity from dams and coal-fired power plants.

City Fiscal Officer Coleen Balzarini said the blended rate has traditionally been lower than the rate the city has been paying, and seems likely to remain lower going forward. However, there is no guarantee.

SME made the surprise announcement on Monday that the cooperative is changing course in regards to the proposed Highwood Generating Station outside Great Falls, and now intends to build a smaller, natural gas-fired power plant at the site rather than a coal-fired plant.

Commissioner Mary Jolley voted against acceptance, urging the commission to delay their decision until they could explore the issue in further depth.

Still, Commissioner Bill Beecher said there wasn't much of a downside to the offer.

"This is a way to get a better rate than we've had, based on what historically has happened," he said. "I don't see a reason not to go in this direction."

The city won't immediately see smaller bills. SME has asked members to build up a deposit that will cover one month's worth of power, Balzarini said. The cost savings between the old and new rates will go toward that deposit, she said. The money will be held by SME, but will still belong to the city and will earn interest, she said.

Board members of Electric City Power, the city's utility arm, voted unanimously in December to urge the commissioners to accept the rate.

Board member Bob Pancich said the city, if it had had the blended rate in June, would have been more than $100,000 better off and would have turned an $80,000 profit that month.

Electric City Power has lost more than $1 million over the past several years, but city officials hope the new blended rate will chip away at the city's deficit.

The city's customers are primarily government agencies and businesses in the Great Falls area.

Another member of SME, Yellowstone Valley Electric Cooperative, complained in a lawsuit filed in December that Electric City Power is getting favorable treatment with the offer of the blended rate.

Also at Tuesday's meeting, the city recognized staff members of the Golden Corral restaurant who previously won the Neighborhood Council 4 Good Neighbor Award.

Since the restaurant burned down last fall, owners have used insurance money — and some of their own money — to keep some staff members on the payroll. The dozen or so staff members have been shoveling snow for senior citizens and people with disabilities, delivering food for Meals on Wheels, and doing other community service work.

Golden Corral co-owner and manager Deb Hudson said the owners have an interest in keeping a core group of staff employed, so they can hit the ground running when the restaurant is rebuilt. Working together to do good deeds for others has also brought them closer together, she said.

Hudson said the restaurant will be rebuilt in its former spot in the Marketplace area, and could open in September or October.

In other action, city commissioners voted to rezone a 2.7 acre tract of land between the city water treatment plant and Warden Bridge. That area was changed from a public land and institutional district to a mixed-use transitional district.

That change could facilitate development of the land, though City Commissioner Bill Bronson doubted the land's value.

"I think in the end it's going to be used for a parking space," he said.