Leadership from businesses making up more than a quarter of the BLP’s power load learned about the looming decision on whether the public utility will continue to invest in the J.B. Sims Generating Station on Harbor Island, or close the coal-fired facility by June 2020 — a move presented to the municipal utility’s Board of Trustees in February.
“What we’re intending to do is put together a budget for next fiscal year that either contains a significant overhaul or doesn’t,” BLP General Manager Dave Walters said. “We’ve got to put a substantial amount of money into the power plant next year, and we’ve got to put it in this (next) budget.”
BLP staff say they’ve spent the past several months evaluating maintenance items identified in a 2012 planning process and via other assessments since then, which will need to be addressed if the plant is to operate for the next 5-7 years. This analysis has shown that many components have reached the end of their expected life. At least $15.5 million worth of fixes are needed to keep the plant running at its current level.
“We’re either going to pick the date the plant goes down, or the plant is going to do it for us,” said Erik Booth, power supply manager for the BLP.
Upgrades are needed to the facility’s turbine, boiler, pollution controls, electrical and auxiliary equipment, and various environmental systems. And it’s not an all-inclusive list. Walters said analysis of what needs to be fixed stopped once the $15.5 million estimate was reached.
“It is a very, very conservative, low estimate,” he said. “This cost is only going to go up.”
Officials note that investments to Sims have been made over the years, but not to the full extent necessary to extend the life of the power plant or its equipment. Several major past repair items include fixing boiler tube leaks and pulverizer issues.
If it’s decided to close the plant, the utility staff would optimize the Sims unit to extend its life to 2020. This optimization would include longer shutdown periods in the fall and spring, and the plant would run at reduced loads.
Work would continue on a multi-year project to complete upgrades to the transmission system infrastructure by fall 2019 in order to adequately obtain enough power from the grid in 2020.
The decision would also allow BLP trustees to identify the best mix of power sources for the community in a market that the utility’s staff say have attractive prices, as well as identify a local production component and where such a facility could be located.
It was noted Thursday that the annual cost to continue the Sims plant’s operation would be more than the combined cost of purchasing power from the grid and operating a local natural gas generating facility.
Attending Thursday’s meeting was local Chamber of Commerce President Joy Gaasch, who said that while her organization hasn’t taken an official stance on the issue, she noted that reliable, affordable access to electricity and other infrastructure is one of the key factors in determining whether manufacturers and other commerce relocate or expand in the community.
Gaasch said she hopes that BLP trustees and Grand Haven City Council can work together to address some of the issues the city has with the Sims closure, such as how the downtown snowmelt system will continue to be powered.
“That’s why the conversation between City Council and the BLP is really important,” she said. “It would be our hope that the City Council and BLP can come up with some plan to address that.”
Gaasch also said that she hopes the BLP will continue to educate the public about the issue.
“I think it is important that people understand what the impacts are both ways,” she said of any decision to keep Sims open or close it in 2020.