Council authorizes utility superintendent to negotiate power-purchase extension with cap for customer rate

The Logansport Common Council unanimously approved Resolution 20-26-117 authorizing the superintendent of utilities to negotiate parameters for an extension of the city's wholesale power purchase agreement with NextEra.

Harold, identified in the meeting as the superintendent of utilities, told the council the city’s current agreement expires in June 2029 and staff has been consulting with NextEra on futures pricing. He described market volatility and said staff seeks authority to negotiate an extension of three to five years while protecting customers: “what this proposal looks for is to allow Mr. Toth to negotiate…that would not allow us to extend beyond 14¢ average to the customer, whereas we’re at 10¢ average right now,” he said, adding the 14¢ figure is a near worst-case scenario.

Harold explained the city can blend its current favorable 39.15¢ equity (per whatever internal rate reference was used) into future contracts so that if market prices fall later, the lower prices would be bought into and blended across the full agreement, which could reduce average annual costs for customers over time.

Council members asked procedural questions about timing and what would happen if negotiated rates exceeded the 14¢ cap; Harold said staff would return to the council if a negotiated agreement could not meet the 14¢ limit. The council then voted to pass the resolution authorizing the superintendent to negotiate within the parameters discussed.

Next steps: the superintendent and designated negotiator (Greg Toth, per the resolution language) will continue talks with NextEra; any final agreement that exceeds the negotiated parameters will be returned to the council for approval.

Source: presentation and council vote recorded in the meeting.