"MAGICAL MYSTERY TOUR" beatles

The snake oil salesmen from AMP-OHIO are at it again. Either Martinsville is the testing grounds or maybe they're viewed as bigger hicks than Painesville.
Read the newspaper article and see if you spot what Martinsville does that Painesville would never do?

City awaits AMP data on project

Sunday, November 21, 2010

By MICKEY POWELL - Bulletin Staff Writer

Martinsville officials now think it will be mid-December before they receive from American Municipal Power (AMP) details about a power plant project in Ohio in which the city may participate.


That is because of the many technical aspects involved in changing a coal-fired project into a natural-gas fired project, the city’s new Power Advisory Committee learned during its first meeting Friday.

The city electric department hoped to have that information already. The new target date is based on city officials’ recent talks with AMP staff.

Six city residents are on the advisory committee. It will recommend to the Martinsville City Council whether the city should participate in the project by buying electricity generated by the plant over a period of years.

AMP has given the city until March 31 to decide whether to take part in the project. The committee anticipates making its recommendation in February.

GDS Associates Inc., a Georgia firm with which the city consults on power issues, also will make a recommendation on whether the city should take part in the project, probably in January, said City Manager Clarence Monday.

The city will provide the information from AMP to the committee at about the same time GDS releases its recommendation, said Monday and Duane Dahlquist, executive director of the Blue Ridge Power Agency (BRPA).

If the information is provided to the committee before then, Monday said, members might have questions for city, GDS and BRPA staff and that could lead to a delay in analyzing the information.

BRPA is a regional organization allowing members, including Martinsville, to pool their resources to achieve efficiencies that could result in them paying less for wholesale electricity.

Ultimately, the committee should base its recommendation on information AMP provides but keep GDS’ recommendation in mind, Monday said.

Documents from AMP that the committee will examine include a feasibility study of the plant as well as a “beneficial use analysis” conducted by R.W. Beck, a consulting firm that studies energy issues, officials have said.

Committee meetings will be open to the public, but those documents will not be made public. Monday said that doing so may result in a lawsuit against the city because the information may contain “trade secrets” such as technical specifications for equipment that companies might consider proprietary.

At the least, he said, releasing information on the project’s anticipated cost factors could hinder AMP’s ability to negotiate costs, which could delay the project and increase costs.

Committee members will be asked to sign agreements that they will not release documents that officials deem unreleasable, said Monday.

He said the committee may choose to go into closed session sometimes to discuss certain information.

Monday said committee members will be shown the documents in private, maybe two at a time. They will not have the documents in their possession during meetings, he said.

“Can I believe what (information) AMP provides?” asked committee member Vince Stone.

“We do not rubber stamp everything AMP says,” Monday said. “That is why we do due diligence,” such as by having consultants and the committee look at the project.

AMP is an Ohio-based nonprofit organization through which Martinsville and 127 other member cities — all of which are considered part-owners — buy wholesale electricity. The power that Martinsville purchases then is sold and distributed to city electric department customers.

Monday indicated that because AMP is nonprofit, it would have nothing to gain by skewing information. He mentioned that other electricity providers which the city has dealt with in power purchases are for-profit entities.

GDS’ recommendation can be trusted, Monday indicated.

“They work for the city, not for AMP,” he said. “They don’t get a commission” for giving an AMP project a positive recommendation.

Martinsville already has agreed to participate in two other power plant projects AMP is developing.

By taking part in AMP power plant projects, the city essentially would be a part-owner of those projects, officials have said. Therefore, the city could buy electricity from the projects for less than it can buy power on the wholesale market, they have reasoned.

The city had agreed to take part in a coal-fired power plant project in Meigs County, Ohio, but that project was stopped last fall after development cost projections came in much higher than expected. AMP is to develop the gas-fired plant on the same site.

A document shows Martinsville’s estimated share of the “sunk costs” toward the ceased coal-fired plant is $1.7 million. Monday said the city has not yet paid any of that cost. Neither has it received an invoice, he said.

The exact costs will not be known for “many months,” Monday said, due to ongoing negotiations with — and maybe litigation against — contractors and suppliers of equipment and construction materials.

Dennis Bowles, the city’s director of electrical operations, said the city can pay back its share of the costs through the costs of purchased power.

AMP “would tack on so much cost” to the price that the city is charged for electricity, he said.

David Maddox, whom committee members elected their chairman, said he thinks city residents would like to see a document prepared that shows how much money AMP committed toward the coal-fired plant, how much money has so far been spent and how it was spent.

With litigation possible, Bowles said he knows AMP would be reluctant to release that information anytime soon.

The committee plans to schedule another meeting before Christmas.

Maddox said the committee has a lot of work to do and the information it will examine will be “overwhelming” in terms of trying to understand it.

“The gray hair I have in my head probably came from (stress over) power purchases,” Monday quipped.

Subcommittees may be formed to study some portions of the information AMP provides, Maddox said.

Also have heard through the grapevine that AMP - Ohio may rename the Meigs County site 'Area 51'.