BPU customers can look forward to not seeing any rate increases across the board in 2013, according to the recently proposed budgets.
All five divisions of the BPU, electric, water, wastewater, solid waste, and district heating and cooling will see rates stay the same for customers if everything continues to go well in 2012, said David Leathers, general manager of the BPU.
"I commend all of our staff in the water resources and electric divisions," said Leathers. "They've done a great amount of work to try to control costs and our performance in 2012 year to date is good. We presented five draft budgets to the board that show no rate adjustments or increases for 2013, so we're hoping that between now and the December board meeting that those are the budgets that get approved. It's extremely important that we maintain rates as best we can and we've been able to do that this year. As far as I know, it may be unprecedented having no rate increases between all five divisions, so all of us are pretty proud about that at this time."
Aside from the budget, the BPU also approved several resolutions, one of which will see them filing a New York State Department of Environmental Conservation application to convert one of their three coal boilers to run on natural gas. According to David Gustafson, BPU electric and gas resource manager, the current coal boilers do not meet many of the emission standards that have been set, and are therefore difficult to run. This conversion from coal to natural gas for fuel would allow the BPU to have a backup system in place if something were to happen to their primary natural gas turbine.
"It's something that we've been working on as a staff, trying to determine what would be a good project for us to progress related to backing up the LM6000 gas turbine as we prepare for a transition away from the current coal plant," said Leathers. "From a financial standpoint, we can't see anything other than this project to do in the next year, which is to convert one of the coal boilers to run on natural gas."
The project, which would cost an estimated $2 million to $2.2 million, would give the BPU the capacity for roughly 12 megawatts of backup power, which from a reliability standpoint is very much justified, according to Leathers.
"It should pay for itself over time," Leathers continued. "We get capacity payments from the New York Independent System Operators for the generation and the megawatt capacity that we have. We would expect that over a 10 year period those payments would offset the cost of the project. It makes sense on a number of different fronts."
The intention of this project is not to compete for electric energy production, but reliability. During peak hours, the demand for electricity in this area can reach as much as 100 megawatts of power. At the Dow Street transfer station, which supplies power from other parts of the Western New York grid to Jamestown, the system is built to handle a maximum load of roughly 100 megawatts. According to Gustafson, it would be dangerous to have the Dow Street station at maximum capacity for a long period of time, which is where this converted generator would be able to help.
"If, during the peak winter season, the LM6000 gas turbine isn't available, we feel it's important to be able to take 10 to 12 megawatts off of our peak so we're not straining the Western NY grid," said Leathers. "The electricity from this unit will be more expensive than the electricity from our gas turbine, so this is really just a reliability option."
The BPU also passed a resolution approving a feasibility study that would look into the possibility of building a natural gas fueling station for use with vehicles from the BPU, Jamestown Public Schools and other organizations.
Currently, the BPU operates a petroleum gas fueling station on Steele Street for vehicles from the BPU, the city, Jamestown Community College and the Jamestown Public School system.
"We're trying to see if there's a site in the general area here that makes sense for a fueling station and trying to see what the permitting and construction costs would be," said Leathers. "It's a two-phased approach to see if this is feasible or not. If it does look like it will be feasible, around March, we will be preparing applications to pursue funding to help support the construction of the fueling facility."
The $45,500 feasibility study, to be conducted by Wendel Engineering, will investigate the benefits and realities of building a municipal natural gas fueling station. Natural gas costs significantly less than both gasoline and diesel fuel and could potentially save as much as $200,000 in fuel costs. If the study determines that the project would be worth completing, the BPU is prepared to look for grants to cover the cost of the station construction as well as the necessary conversion that would be required for vehicles to run on natural gas.
"From a financial perspective, it makes a lot of sense to run vehicles on natural gas versus the fuel station that we have," said Leathers. "This is just the beginning of a three or four month process to look at that."