When the agenda came out last Friday for tonight's City Commission meeting, I questioned this item . Commissioner Jolley asked that the item be pulled from the consent agenda for further discussion, which it was. According to John Lawton, this is what it means:
* SME buys power from PPL and sells it to the city.
* During the course of the month, sometimes the demand for power is high, sometimes it is not. This imbalance is tracked by NorthWestern, the cost of which is market driven.
* It takes a few months for the actual imbalances to be calculated and the invoices sent to the city.
When the vote was taken on this item, Commissioner Jolley dissented.
So yes, Firefly, you do need to add $130,700 to your totals for 2007.
* SME buys power from PPL and sells it to the city.
* During the course of the month, sometimes the demand for power is high, sometimes it is not. This imbalance is tracked by NorthWestern, the cost of which is market driven.
* It takes a few months for the actual imbalances to be calculated and the invoices sent to the city.
When the vote was taken on this item, Commissioner Jolley dissented.
So yes, Firefly, you do need to add $130,700 to your totals for 2007.
6 comments:
So, I still don't get it. Is this money spent for energy we bought, but don't use? Or is it for energy we didn't buy, so had to buy after the fact?
The impression I got, and Commissioner Jolley please correct me if I misunderstood, is this was power that was used but not purchased, so had to be bought after the fact.
Maybe I've missed the boat on what happened here and I'm asking the wrong question, but how could the city so miscalculate the usage of power during this time frame? And I wonder what the final two months of the year will show.
my guess is that like many answers from "Staff" the answer was designed to confuse.
I think that we are "advised" by our partner as to how much power we need and then when we run low we pay through the nose for power that our partner than sells us for ?profit?"
How could the city not miscalculate - it is a business they /we know nothing about. I fear we will be using the same knowledge base to LEASE our water rights to SME.
Thanks for keeping an eye on this gfgirl.
Thanks very much Mary for making me feel better!
There have been many times after Staff has given an explanation, I found myself asking, "Self, what the hell does that mean?" There have been a few times I thought I just wasn't smart enough to be getting it.
I'm glad to know from an "insider" that when there are times I/we are confused, its because that's the way they want it.
On my Commercial power bill there is a charge called "demand charge" which is over and beyond my actual KWH charge. It has to do with peek usage. If you use a constant power level of electricity over the month it is relatively low but if your usage spikes for a short period you pay through the nose. I think it is because the supplier has to size the entire system around the peak users with high KW demands even if their monthly KWH usage is small.
Because Lawton used the word "demand" in his explanation I thought this might be relevant. But it is Lawton so who knows.
We purchased "blocks of power." We sell "blocks of power." If a customer demands more than they purchased, any premium for that power should be paid not by the City (reseller) but by the customer, right? Presumably, the $130k or so we just sent to SME was paid to us by our customers that demanded the power, right? If true, it's a wash from the City's point of view. Why didn't Mr. Lawton point that out?
Assuming the "blocks of power" we purchased do not exceed the "blocks of power" we sell, how do we ever have a shortage of power (whether spike or overall) that requires us to buy more power?
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