Ames electric utility outlines generation plan, AMI and 2025–26 budget assumptions

Don, the city electric department director (as spoken at the meeting), told the council on Feb. 5 that the electric utility is proposing roughly $64.5 million in departmental expenditures for fiscal year 2025–26, a figure staff said is about 2.3% below the prior adopted level.

Staff reported a peak system demand of 134 megawatts in the past year and outlined near‑term planning to add generation resources, expand renewable procurement and roll out advanced metering infrastructure (AMI). Don said the council‑approved cost‑of‑service changes that took effect Oct. 1 were accompanied by pilots for time‑of‑use rates and that AMI is required to expand those programs.

The presentation included supply and contract notes: the city is evaluating its natural‑gas purchasing approach as an expiring contract reaches the end of the year and told council that a Nextera (utility‑scale) renewable contract expires in 2029; utility staff said they are negotiating with developers for new wind and rooftop solar options. Retail solar approvals stood at about 214 projects and the utility reported approximately 1.7 megawatts of retail rooftop solar on the distribution system.

On finance, staff said the electric fund begins the year with an estimated balance near $38.5 million, a new target reserve figure recommended by the cost‑of‑service study (about $20.3 million), and that staff are modeling a 1.5% rate increase for FY25–26 as part of an overall multi‑year funding approach. Don and staff described the reserve target as intended to provide roughly 90 days of cash in hand for reliability and disaster response, including reimbursement timing for large outages or repair costs.

Operational items presented included leased black‑start generation while an existing combustion turbine is refurbished, continued work on asbestos removal at the plant, transmission and distribution pole replacements, expanded animal guarding and inventory increases for transformers and cable to reduce outage risk, and continuing demand‑side management and beneficial‑electrification rebates.

Councilors asked about comparing retail solar with peers; Don said Ames has a “robust retail program” compared with nearby investor‑owned utilities and that Cedar Falls and Muscatine have different profiles (for example, Cedar Falls has utility‑scale solar). Staff said a URAB (utility review/advisory body) recommendation on a value‑of‑solar methodology will be returned to council, and that a URAB presentation on residential solar incentives was expected on Feb. 28.

Ending: Don said staff will return with more detailed proposals for rooftop and retail solar incentives, the AMI roll out schedule and procurement plans for generation resources as the CIP and climate action planning work continues.