Gardner Utilities panel delays decision on GRDA power purchase extension

The Gardner City Utilities Advisory Commission on Jan. 2 reviewed staff analysis and alternatives related to extending a power purchase agreement (PPA) with the Grand River Dam Authority (GRDA) and voted to postpone a recommendation to the City Council until its February meeting.

Staff presented historical cost comparisons and capacity forecasts for the city's existing GRDA PPA, which currently supplies 9 megawatts of paper capacity. The presentation said the original contract (entered through KMEA on May 1, 2005) covers capacity and energy through April 30, 2026, and that KMEA has asked member cities for approval in time for KMEA and GRDA to finalize agreements in March. Gons, a staff member, said the city must provide an answer by March 1 so KMEA can carry forward municipal approvals to its executive committee meeting later that month.

The presentation showed component costs for the GRDA contract: capacity charges of about $10.45 per kilowatt-month (roughly $945,000 per year), energy charges averaging about $40 per megawatt-hour, a power cost adjustment (PCA) that averaged about $2.6 million in recent years, and a KMEA administrative fee of about $129,000; staff summarized those elements into an average annual PPA cost of about $3.7 million. Over a proposed 25-year extension, staff estimated capacity at roughly $23 million, energy $65 million and administrative fees about $3.2 million, for a 25‑year total in the neighborhood of $92.5 million (figures were presented…