Sometimes, you just don’t know what people want until you ask them, as the municipal utilities board of directors in Fremont, Nebraska, learned when they set out to diversify their municipal power portfolio.
City Administrator Brian Newton recalled that one of his first projects after joining the city staff three years ago was to work with the board of directors on a strategic plan for their power supply. At the time, the city of around 27,000 was powered mainly by coal and natural gas. “The board decided it would be a good idea to investigate adding other resources,” said Newton.
Consulting experts, customers
His initial reaction was that the customers would not be interested in solar energy. After all, Fremont residents enjoy a low residential rate of just 8 cents per kWh, and no one had installed a privately owned solar system.
That was a smart move, because SEPA research has shown that a successful community solar project starts with knowing your audience. The survey SEPA conducted was an eye-opener for Newton. “More than 70 percent said they were interested in solar power, and some said they’d pay $10 more per month for it, which I doubted,” he said.
Just to make sure the survey results were on track, Newton held numerous public meetings to explain community solar to customers and get feedback from them. More than 500 people signed up to receive information about solar energy and many were adamant about joining the community affair. They not only wanted the solar power to be sold in Fremont, they also wanted it built by local developers, financed by local money and under community control.
Designed to sell
To make participation easy, Fremont put together a unique package of options. Customers can choose between purchasing panels, buying one or more solar energy shares and subscribing to a combination of panels and shares.
Solar subscriptions can cover up to 80 percent of residential customers’ annual kilowatt-hour consumption and 50 percent for commercial customers. One panel generates an average of 43 kWh monthly, while one solar energy share represents 150 kWh monthly. Customers who purchase panels are able to take advantage of the Federal Solar Investment Tax Credit, making participation even more attractive.
If the utility board of directors had any remaining doubts about customers’ interest in solar, those were laid to rest when the 1.5-megawatt solar farm sold out in seven weeks. Fremont promoted the project with customer meetings, emails and bill stuffers, the usual avenues for getting the word out. Newton noted that the 1.2-MW second phase of the solar farm is selling out by word of mouth alone.
Newton may have been surprised by customers’ eagerness to invest in renewables, but he told SEPA the rural community’s latent environmentalism shouldn’t be surprising. The community has always been firmly rooted to the land because agriculture is central to the local economy, he said. “Damaging the land or air isn’t an abstract idea. Fremonters can see the impact of environmental degradation on their livelihoods.”
Or, as one resident observed, Fremont’s support for solar power is not a surprise, as much as it is the natural progression of a long history of civic involvement in environmental stewardship.
WAPA Administrator Mark Gabriel will present WAPA’s prestigious Administrator’s Award to South Sioux City, Nebraska, Oct. 18 at the Delta Hotels in South Sioux City. The presentation is part of 2017 National Bioenergy Day, an event that will be attended by local, state and federal officials and high-ranking industry representatives. Gabriel will also deliver the keynote address, “The Importance of Renewable Energy Diversification,” at Bioenergy Day. The event will also include a tour of the new Green Star Energygasifier power plant.
Despite its small size—a population just over 13,000—South Sioux City has consistently delivered innovation along with affordable, reliable power year after year, warranting the honor the award confers on a WAPA customer. But these accomplishments feel almost secondary to the vision that made them happen. South Sioux City is well known among its peers and many other WAPA customers for being exceptionally forward thinking and tenacious at finding and leveraging win-win partnerships.
Leading in renewables South Sioux City is pursuing clean, low-carbon electricity with a unique mix of projects.
A 2.3-megawatt (MW) photovoltaic array is only the latest example of the town’s efforts to reduce its carbon footprint. The 21-acre solar park began operation in January and generates the equivalent of 5 percent of the city’s total electricity needs. South Sioux City also recently selected a firm to build 15 MW of new wind power and signed an agreement to begin receiving generation from it in 2018. Both the wind and the solar projects are public-private partnerships.
In a region where agriculture and related businesses are the leading industries, biomass represents an energy resource that South Sioux City has captured through different projects. Three major food processing plants divert animal, grain and other wastes to an anaerobic digester that extracts methane from the stream and feeds it into the natural gas pipeline. The nearby Siouxland Ethanol Plantdisplaces up to 9 percent of its natural gas needs for ethanol production with landfill gas from the LP Gill landfill.
The Scenic Park campground was the site of a pilot program in 2015, using a gasifier woody biomass system to generate 50 kilowatts of electricity from wood waste from storm damage. The unit was so successful that South Sioux City entered into an agreement with Green Star Energy to build a 3-MW gasifier. The new power plant will take city and industrial waste wood and dead and dying trees destined for the landfill and convert it into electricity.
Another potential project with Green Star Energy shows that South Sioux City has not lost sight of the tried-and-true renewable resources. The partners are seeking funding to build an innovative hydropower generator along the Missouri River that flows through the south end of the city. The run-of-river turbine design resembles a boat dock, would be safe for fish and aquatic animals and could produce enough electricity to save South Sioux City about $450 each day.
Conserve, reduce, manage Energy innovation in South Sioux City is not limited to developing new resources. Planning and wise use are just as important to creating a cleaner, sustainable energy supply.
When peak demand needs to be curtailed, the city takes a two-pronged approach. First, a major industrial load voluntarily ramps down its demand by 11 percent to save not only its own energy costs but the energy costs for the city as a whole. On the residential side, the municipal utility has placed demand meters into service to control peak demand from air conditioner use. Both strategies have helped the community to contain electric costs.
The municipal utility has performed energy audits on all city buildings and facilities to identify energy-saving opportunities. Improvements included adding variable speed drives, converting street and signal lighting to LED and installing LED office lighting. Energy-efficient heating and cooling measures and practices have also been implemented in city buildings.
To address the need for backup support and electric demand relief during peak times, the city is designing a 5-MW, state-of-the-art natural gas-powered generating station. Excess generation from the unit will be offered to the Southwest Power Poolmarkets.
Practicing stewardship South Sioux City was the first city in Nebraska to implement a paperless city council. In addition to reducing environmental impacts, the approach simplifies the archiving of council activities and makes it easier for the public to access more information. A voice-activated council chamber video recording system allows citizens to access live and archived meetings.
Tree health and sustainability are important to South Sioux City, which has qualified for the Arbor Day Foundation’sTree City USA designation for 25 years and earned the Growth Award for 10 years. For the past eight years, the city has planted one new tree for every 30 residents.
Residents enjoy the city’s two community gardens and the more than 200 fruit trees the city planted in 2014. The orchard is part of a facility designed in partnership with the University of Nebraska – Lincoln to provide storage and opportunities for youth outdoor learning activities. The new building is the first compressed laminated timber structure in Nebraska. Ash tree planks salvaged from emerald ash borer kill and milled by the Nebraska Forest Service side the building. The project received the 2017 Community Enhancement Award from the Arbor Day Foundation.
Quality of life is part of environmental health too, and South Sioux City actively promotes healthy lifestyles. The city’s extensive network of developed trails earned the first “Bicycle Friendly Community Award” in Nebraska in 2006. The trail system connects to 60 miles of trails in four cities and three states, and hosts many rides, runs and other events throughout the year.
Partners make it happen Innovation doesn’t occur in a vacuum and partnership is as critical to South Sioux City’s efforts as vision is. City Administrator Lance Hedquist acknowledges that the city’s success with energy efficiency and renewable energy projects results from the support and trust of the mayor, council and staff who share his passion to make the city a great place to live and work.
South Sioux City’s collective approach to innovation, partnerships, governance and trust would be impressive in a city many times its size. In a small municipality, it deserves recognition: WAPA is proud to honor South Sioux City with the Administrator’s Award.
Development of a renewable energy project is governed by circumstances specific to that site, and the reasons for building the generation are often just as unique. For the little town of Neligh(pop. 1,600) in northeastern Nebraska, renewable energy offered a creative path to avoiding high peak demand charges.
The city installed a 6.5 megawatt bio-diesel electric generation plant—one of a kind in the state—in 2012. The generation capacity allows Neligh to purchase economical electricity from outside entities while using the bio-diesel generators for peak electric demand and emergencies. Self-generation saves the city a wholesale electricity supplier demand charge.
“The bio-diesel generation has been a great savings for our community, and a safety net for Neligh and the surrounding communities,” commented former Mayor Jeri Anderson, who left office at the end of 2014. “Neligh can generate to help the capacity loads for other communities in emergency situations, and it is a great backup energy resource for us.”
Searching for solutions For large electricity customers, demand charges—that fee your power provider adds to your bill for your highest energy use—can be notoriously tricky to control. Efficiency reduces the overall amount of energy a facility or community uses. However, an unexpected event like a large manufacturing order or extreme weather can cause the need for electricity to spike, and that need must be met. For years, Neligh bought expensive wholesale power to meet peak demand and emergencies, resulting in monthly supplier demand charges of around $50,000.
Besides reducing demand charges, the city also wanted to purchase low-cost “economy energy” from the Municipal Energy Agency of Nebraska (MEAN). Economy energy is the standby reserves that large generators always have on hand to meet sudden demand. To offset the cost of producing this energy, the generators sell it to various buyers on an hourly or day-by-day basis. Under the state Power Review Board (PRB) rules, a city may buy economy energy if it owns generation capable of producing 115 percent of its demand. Clearly, it was not difficult for Neligh to make a business case for building its own power plant.
Answer is green The problem with that solution was that a private investor cannot own a generator in the all-public power state of Nebraska. Also, the PRB must approve all new generation, which places the burden on cities and villages to prove a verifiable need for additional generation. That is a difficult hurdle to clear in a state that has plenty of generation capacity.
A potential loop-hole opened several years ago, when a hog farmer installed a methane digester generator and petitioned the PRB to sell his excess power to Nebraska Public Power District . The board determined that since this energy was renewable—“green”—it was regulated by FERC, so the PRB had no authority to rule either way on the sale. “When I learned of the decision, I began researching green energy systems that Neligh could install,” said City Attorney Jim McNally.
A bio-diesel generator of less than 40 megawatts met the PRB’s criteria, and Neligh was issued a permit to build. Mayor Joe Hartz attributed the outcome to a strong relationship with NPPD and to cooperation between Neligh’s municipal utility, NPPD and MEAN. “That allowed us to provide the best of all worlds for our customers,” he said.
Logistically, economically feasible The installation itself was a straightforward project, since the generators are conventional diesel equipment. It is the fuel—100-percent soy oil in Neligh, rather than fossil fuel—that qualifies the project as renewable. Only the rubber hoses had to be changed out on the four used Caterpillar generator sets. Because the fuel tends to jell when cold, the plant is housed in a heated building.
The city paid a little more than $3 million for the generators and some lightly used controls, financing the purchase on a 15-year bond. The power plant now qualifies Neligh to purchase economy energy from MEAN, but more importantly, having its own power supply has saved the city from paying demand charges. “In place of the $50,000-per-month demand charge, we have a monthly bond payment of about $17,000 for the equipment,” McNally explained. “The city nets around $30,000.00 a month in savings, or $300,000 annually after the bond payment. That is significant for a city of 1,600.”
The attorney added that Neligh’s new access to the economy energy market is what makes the renewable aspect of the project economically viable. “Wholesale power in Nebraska is less expensive than self-generation with either diesel or biodiesel,” McNally acknowledged.
Potential environmental regulations could change the equation, but McNally believes the bio-diesel generators will continue to be a net winner for the city budget. The little city of Neligh should not have any problems handling whatever the future holds. Volatile prices and new rules are no match for ingenuity and savvy planning.