Garden City directs staff to negotiate 9‑MW power supply agreements amid rising transmission costs

Garden City commissioners voted Dec. 3 to direct staff to finalize negotiations for a 9‑megawatt power purchase allocation, after hearing a presentation on market changes that will raise capacity and transmission costs in the Southwest Power Pool (SPP) footprint.

Paul Malvern, general manager with the Kansas Municipal Energy Agency, summarized options presented to the commission: a 20‑MW large‑scale solar PPA in Pratt County with no upfront cash and a 30‑year commitment; a 9‑MW GRDA slice with no upfront cash and a 25‑year term; a 15‑MW GRDA alternative that would require a transmission study; and the option of adding local fossil generation (estimated at $20,000,000 for 20 MW). Malvern told the commission that SPP reserve margins for summer capacity have increased and winter reserve requirements have been introduced, increasing the need for additional capacity.

Malvern outlined transmission cost increases and price ranges: “The pricing options for options 1, 2, or 3 range from $45 to $60 per megawatt hour,” and option 4 (local fossil generation) was estimated at $65–$80 per MWh. Staff briefed the commission that additional transmission projects approved by SPP and broader generation changes are projected to raise wholesale power supply costs and transmission services over the coming years.

Commissioners discussed growth and transmission constraints and the need to monitor a potential move from 9 MW to 15 MW pending the 2026 cost-of-service study. A motion to direct staff to finalize negotiating contract components with NextEra Solar and GRDA for 9 megawatts was moved and seconded and the commission approved the motion.

Next steps: staff will continue contract negotiations with NextEra Solar and GRDA for the 9‑MW allocation and return to the governing body for final contract approval.