MAYVILLE - The county's methane-generated electricity is still selling at an "extraordinarily low" rate, according to Finance Director Darin Schulz - even lower than this past summer.
In June, Schulz broke the news to the County Legislature's Audit and Control Committee that the energy market had fallen through the floor.
As a result, the power being generated by the county's new methane-to-electric plant wasn't worth as much as officials had budgeted - and it still isn't.
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Darin Schulz is pictured here addressing one of the County Legislature’s standing committees.
P-J file photo by Nicholas L.?Dean
In June, Schulz told the committee that the county looked to be $1.5 million down from its 2010 revenue projection - likely to net only $498,000 of the $2 million which had been budgeted.
On Monday, Schulz told the Public Facilities Committee that, through October, the county has seen only $297,492 in profit from the plant.
He also informed the committee that the county is submitting a proposal to the state of Massachusetts, a proposal which could secure a 15-year contract for some of the plant's electricity. If accepted, the agreement would significantly bump up the plant's revenue while making it easier for the county to budget revenues.
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In recent years, Schulz explained, the average price for a megawatt was $102. This year, however, the price dropped to under $50.
Had the average price remained over $100 per megawatt, the county would have been receiving $2.6 million in revenue this year.
The bid being put forth by the county, should Massachusetts accept it, could mean a price of $85 per megawatt - putting the county between $1.5 and $2 million in revenue.
"That would be the total package," Schulz told the committee of the bid. "That would be the price of electricity and the renewable energy credits combined. And the bid that we've submitted is $85 per megawatt with a 2 percent escalator for 15 years."
The length of the potential contract gives Massachusetts a benefit in the long run, Schulz explained. With the price of electricity likely to rise down the road, the county and Massachusetts would be locked into a price for 15 years which benefits the county up front and Massachusetts later on.
Maybe more importantly, the revenue would be a fixed and stable rate which the county could more confidently count on.
"And then we would know exactly our dollar figure and we wouldn't be guessing like we did last year," said committee member Larry Barmore, R-Gerry.
"When we looked at putting this bid together," Schulz said, "we thought that was the best way to go - to try to lock in a guaranteed return. Even though we may potentially lose out in the long run when rates are extremely high, it will take away the fluctuations. We are in the final stages of working with Massachusetts on this bid, so I think there's a good chance that we'll get it."
PLANT EXPANSION
Work also continues on the county's plans to expand its methane-to-electric plant.
The Public Facilities Committee reviewed two resolutions Monday regarding the proposed expansion - one to authorize standardization of the two new engines and one to bond $1.4 million to pay for the project.
A total of four engines are currently converting methane gas from the Ellery landfill into electricity. Two additional engines will be added to process the gas, one first in 2011 and the second in 2012.
Each engine will send 1.6 megawatts to the plant. A fifth engine will make the plant an 8-megawatt plant, while the sixth will take it to a 9.6-megawatt plant. According to Schulz, the additional electricity generated from the two engines will not be a part of the deal with Massachusetts - meaning the county will be free to sell it at market rate.
To expand the plant to the 9.6 megawatt capacity will cost $3.5 million, with $1.9 million in funding secured by Senator Charles Schumer and $1.4 million bonded for by the county.
"And these are rough numbers," Schulz said. "We are currently in negotiations with contractors to get the best price."
The legislature will meet at 6:30 p.m. on Wednesday, Dec. 15.