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Zeeland council approves up to $30.6 million in energy purchase commitments through 2031
Summary
Council unanimously approved MPPA-recommended short-term firm energy purchases for 2028–2031, authorizing a not-to-exceed commitment of $30,628,842.40 to hedge the BPW’s resource position across on-peak, off-peak and around-the-clock products.
The Zeeland Common Council on Feb. 16 approved multi-year energy purchase commitments recommended by MPPA staff, authorizing the BPW Member Authorized Representative to commit to a portfolio of short-term firm energy products for calendar years 2028 through 2031.
Utilities Manager Designee Robert Mulder and staff presented the recommended transactions as a hedging strategy to align the Board of Public Works’ forecasted load with risk-management policy. The approved not-to-exceed total is $30,628,842.40 covering 426,837 MWh at an average cost of $71.76 per MWh.
Key elements approved include: for 2028, on-peak (5x16) up to $6,580,694.40 for 80,672 MWh and off-peak (5x8, 2x24) up to $3,947,703.00 for 68,596.6 MWh; for 2029, on-peak up to $7,206,977.60 for 85,688 MWh and off-peak up to $4,547,148.20 for 76,421.2 MWh; for 2030 and 2031, around-the-clock (7x24) volumes and caps were similarly approved. Mulder explained the transactions are financially firm energy with physical delivery to the MISO Michigan Hub in the Day Ahead Market at or below stated price limits.
Council approved the motion unanimously. The authorization permits the BPW’s authorized representative, or alternate, to enter the transactions within the approved not-to-exceed limits.
