The BLP is committed to meeting our community’s shared priorities with a sustainable vision for the future. Among other activities each year, we issue a customer satisfaction survey to listen to our community. Here are some important considerations from the past two years:
In the FY2021 survey, 82% of our residential customers indicated local generation was important to them. Local control has been a longstanding value in our community and was an important consideration when retiring the Sims coal plant. The future Harbor Island design plans include a right-sized peaking plant that gives us the ability to generate electricity during periods of peak demand, such as this past February cold snap.
In addition to local generation, over 68% of customers said they were interested in GHBLP purchasing additional renewable energy. We agree that this must be a priority for Grand Haven. In fact, GHBLP is on track to contract 25% of power from renewable sources by 2022, ahead of state requirements.
However, while the community desires renewable energy, our FY2020 survey indicated that 85% of our community also reported no interest in paying more for renewables or interest only if it was at or below current cost, indicating strong concerns about affordability.
The BLP’s power supply plans meet all of our community’s needs: local control through the proposed Harbor Island peaking power plant; affordability through that same local control and the smaller generation scope of the peaking plant; and environmental sustainability through the increased purchase of renewables coupled with dedicated space on Harbor Island to take advantage of future technologies like battery storage.
Even though these plans are well underway, we are still listening and will continue to do so. We encourage anyone looking to learn more to read more about the Grand Haven power plan and the process to reach that plan.
Read the letter to the editor submitted to the Grand Haven Tribune here.
Blog Post; GHBLP Rate Study Projects Lower Rates in Alignment with Strategic Plan
Grand Haven Board of Light and Power (GHBLP) could reduce average customer rates by 1.3% in the fiscal year 2022 (beginning July 1, 2021) according to the results of an independent rate study presented by Utility Financial Solutions (UFS) Thursday evening.
GHBLP hired UFS, a national independent utility rates consultant, to conduct a cost-of-service study to evaluate the utility’s transition away from primarily a local single-source coal-fired power supply model toward one that draws primarily from a diversified power supply portfolio with multiple sources in multiple locations. In keeping with investments in renewable energy and other regional power sources and the development of a peaking power plant on Harbor Island, UFS concluded the Board is able to reduce average customer rates by an overall 1.3% in 2022 and then hold them steady over the next 5 years.
“Through our five-year strategic plan approved in 2016, we reduced rates twice for GHBLP customers and held them constant for the rest of the planning period,” said Jack Smant, Board Chair. “We are pleased our new diversified power supply structure will allow us to reduce rates further in 2022, and again anticipate holding them steady throughout the next 5-year Strategic Plan period while continuing to enhance power supply price stability, affordability, and sustainability for our community at large.”
Most GHBLP serviced businesses will see reductions of 2.5-5% of their energy costs, and current residential average rates will stay the same. Consistent with UFS’s determined “costs-of-service” findings, the fixed components of the BLP’s rate structure are being recommended to be increased and the variable components that fluctuate with consumption will be reduced accordingly. However, the net result, on average, will equate to the 1.3% reduction UFS is recommending. Through careful capacity planning, both locally and through power purchase agreements with the Michigan Public Power Agency, GHBLP is one of few utilities planning for stable or reduced rates in 2022, while investor-owned utilities like Consumers Energy have raised residential rates by 11% in 2021 and are seeking another increase of 9% in their recent rate filings before the MPSC. GHBLP’s proposed lower rates have been determined adequate to recover the necessary redevelopment and project costs at the utility’s Harbor Island site. Without bond financing anticipated for this project, rates would likely need to increase to pay for mandatory environmental clean-up efforts on the Sims site and other capital costs that have already been completed or will remain in the five-year spending plan.
“These rates directly impact our community, and with an additional 1.3% rate reduction, GHBLP could save our community approximately $430,000 in Fiscal Year 2022,” said Gerald Witherell, vice-chairperson of the board. “That’s money that our customers can put directly into their savings, their homes, local businesses, and economy.”
Without regular system upgrades, our community would not have the electrical capacity to accomplish basic tasks that we take for granted, like running modern appliances and HVAC systems. The average American home in 2021 differs vastly from the average American home in 1960. Continually updating GHBLP’s electrical system infrastructure to meet increased electrical demand allows Grand Haven to enjoy reliable and affordable power.
Getting Power to Your Home
Moving generated electricity from a power plant or from the grid to your home may involve more steps than you think. A vast infrastructure of electrical wires, poles, substations, and transformers work together to ensure reliable power for the Grand Haven Area.
With the demolition of the Sims plant, all of Grand Haven’s power currently begins with our connection to the regional transmission network (aka “the grid”). After passing through transmission lines to reach our substations, the voltage is reduced via substation transformers to supply three phase, high-voltage, alternating current (AC) which flows throughout our distribution system. The power is further reduced by distribution transformers to 120V or 240V AC for most small businesses or homes (“secondary customers”). Some larger industries (“primary customers”) use higher voltages, customized to their specific needs.
In Grand Haven, over 13 miles of transmission lines and 178 miles of distribution lines bring electricity to residences and businesses. As our community has consumed more energy over the years, we have increased our system’s capacity. Over the last few years, we replaced the transmission lines to increase our system capacity by more than 300%, allowing the system to handle a larger load at any given time.
Other recent system maintenance included an inspection of over 8,000 electrical poles, noting which should be included in future upgrades. GHBLP also recently consolidated three substations into one on the Harbor Island site. Replacing the old substations, originally installed in the early 1960’s, allowed us to upgrade system equipment and technology, increase capacity and greatly reduce the substation’s footprint.
Preparing for the Future
Beyond regular maintenance and upgrades, the Harbor Island system design also prepares for future technological advances, such as battery or hydrogen fuel cell storage. This future preparation allows the distribution system to stay flexible in its capacity to handle technologies that may require greater system capacity, such as the widespread adoption of at-home electric vehicle charging.
GHBLP customers/owners rely on a robust and solid distribution system to support their electrical needs. With these ongoing capital improvements, GHBLP staff can easily schedule maintenance work, preventing unplanned outages that result in overtime and save labor and infrastructure costs that could otherwise add up. Regular maintenance ensures that Grand Haven residences and businesses can count on GHBLP to keep their power affordable and reliable for years to come.
Tuesday, March 23, 2021, Grand Haven, MI – Grand Haven Board of Power & Light (GHBLP) has earned a Diamond-level Reliable Public Power Provider (RP3)® designation from the American Public Power Association for providing reliable and safe electric service. In alignment with the strategic plan set forward by the Board five years ago, the utility’s concerted investment in distribution technology and safety best practices helped earn this industry-leading designation.
“Our customer-owners have continually identified reliability as the most important component to their relationship with the BLP,” said David Walters, GHBLP general manager. “We’re really proud of the hard work and innovation our team has invested into modernizing our electricity distribution and metering infrastructure.”
The RP3 designation, which lasts for three years, recognizes public power utilities that demonstrate proficiency in four key disciplines: reliability, safety, workforce development, and system improvement. Criteria include sound business practices and a utility-wide commitment to safe and reliable delivery of electricity.
“I think over the last year or so, we’ve seen the vital importance of running a reliable and safe utility,” says Aaron Haderle, Chair of APPA’s RP3 Review Panel and Manager of Transmission and Distribution Operations at Kissimmee Utility Authority, Florida. “The utilities receiving the RP3 designation have proven that they are committed to running a top-notch public power utility by implementing industry best practices.”
GHBLP’s designation comes on the heels of its announcement of design plans for the redevelopment of its Harbor Island site after the retirement of J.B. Sims coal power plant. The utility plans to continue investing in community reliability and rate stability by developing an Operations and Technology Center at the site, including combined heat & power generation and workspace for distribution and metering operations. The site also includes space for the deployment of additional reliability measures in the future potentially including advanced energy storage or other enhanced reliability technology.
Founded in 1896, Grand Haven Board of Light and Power is a public, community-owned utility, providing electricity for approximately 14,800 customers in Grand Haven and the surrounding area. Learn more about the utility’s plans for the future at grandhavenpower.org.
As Texas’s energy woes filled the news this February during an unusual period of freezing weather and snow, West Michigan also experienced a cold snap. While grid management and regulation in Texas is very different from Michigan, the impact of the weather event here still added strain to the system.
The Cost of the Cold
When buying power from the grid in real-time, cost fluctuates based on availability and current demand. This fluctuating wholesale locational marginal price (LMP) sets the cost of a portion of the energy Grand Haven Board of Light & Power purchases. This cost spiked during the cold snap that dropped temperatures into the teens. In other words, real-time electric demand went up and supply was constrained, so prices escalated.
While much of the GHBLP’s energy supply is hedged through longer-term contracts with the Michigan Public Power Agency (MPPA) to keep costs as stable as possible, periods of extreme cold and high demand can increase costs for the portion that is unhedged. Initial reviews of this time period show that GHBLP purchased an average of 10.2 MW each hour for 257 hours when the LMP averaged over $100/MWh. These 257 hours cost the BLP system an additional $268,063 for that portion of our wholesale energy supply. 10.2 MW over this period constitutes about 0.9% of our annual supply of energy, but it cost us about 3 times more than the average wholesale energy cost per MWh during the rest of the year.
Savings of a Combined Heat & Power Plant
If GHBLP could have utilized the planned Combined Heat and Power (CHP) plant during this cold snap, it could have mitigated the costs associated with buying power from the real-time market with our ability to generate using this asset.
With GHBLP’s future CHP plant generating 12.5 MW/h during these 257 hours, not only would the snowmelt system not have needed to buy natural gas to fire its boilers (directly saving the City of Grand Haven money), but the net cost for electricity for GHBLP customers-owners would have been much lower. Generating our own power provides the advantage of cost reductions during peaks such as these, with the added revenue of excess power sales during those hours, is essentially a “call option” on lower-priced energy during periods of higher real-time prices.
If the CHP plant were built and running, the plant could have generated more than enough power to cover the unhedged portion of our supply for all but 49 of the 257 high-priced hours and sold back some excess energy during many more hours. With the ability to generate a portion of our needs and sell some power to the market, GHBLP could have made $57,561 to balance the cost of operating the plant, for a reduced net cost of energy from the plant to the system of $70,393 (for 2,619.6 MWh).In conclusion, a net savings of $197,130 for these 2,619.6 MWh during these two weeks would have been an incredible benefit to the community in addition to the savings from avoided capacity charges that the plant would save every month of the year. We look forward to all of the ways in which the new system design will work for the people of Grand Haven to keep local control of our utility while increasing affordability and reliability.
One question that we have frequently been asked at Grand Haven Board of Light & Power is how our rates compare to other local service providers such as Consumers Energy. To help answer this question and raise awareness about one of the most important benefits of having a community-owned electric utility, we compared the financial impact for GHBLP customers using Consumers Energy (CE) rates as of January 1, 2021 to current GHBLP rates. This evaluation shows that if GHBLP customers were to receive service from CE, the community would holistically pay $6.6 million MORE per year under CE’s 2021 rates.
In other words, if all 14,713 GHBLP customers were billed under Consumers Energy’s current applicable rates, they would pay an average of $0.145/kWh (about 18% more on average than they pay under current applicable GHBLP rates).
Put another way, our community collectively saves about $550,000 per month on average under GHPLP’s current rates as opposed to CE’s similarly applicable current rates each and every month! That is $6.6 million per year in savings for our community!
GRAND HAVEN, MI – A significant portion of Harbor Island in Grand Haven will be turned into a public recreation site with the removal of the J.B. Sims power plant while the rest is expected to house a $17 million heat and power facility.
That’s according to plans of the Grand Haven Board of Light and Power, which shuttered the plant in early 2020 and arranged for its demolition by explosives in February.
An estimated half of the property will be restored to wetlands and opened for community use. Plans call for potential expansion of the island’s Linear Park along the Grand River and designs show walkways and boardwalks throughout the area.
The rest of the site will be reserved for a new Operations and Technology Center that will include five gas-powered engines and five hot water boilers to provide backup electricity and heat for the city’s downtown snowmelt system. The site also holds a large substation that recently received $4 million in improvements and serves downtown and the western portion of the city.
Construction of the plant, which will take about two years, and environmental remediation will cost an estimated $25.6 million, according to information provided at a public presentation of plans last week. Demolition of the plant cost $5 million.
The Board of Light and Power intends to sell $45 million in bonds to pay for the center demolition, remediation and related costs, said David Walters, general manager of the Board of Light and Power. Bonds would be paid off in 20 years, he said.
The plan still needs formal approval by the board, and will need approval to sell the bonds from the Grand Haven City Council.
The proposed facility would be able to generate up to 12.5 megawatts of electricity, which is about 5 percent of the city’s energy needs, Walters said.
It typically would be used when costs of electricity the city buys from other producers is too expensive, providing a “financial backup” for the city and helping BLP control its costs, Walters told MLive.
“It’s able to come online when power costs are high,” he said.
When the generating engines are on, waste heat from them would be used for the snowmelt system that was built in 2010. However, those engines will not always be on, and that’s when the hot water boilers would be used for snowmelt, Walters said.
The Board of Light and Power is reimbursed by the city for the heat, which in turn collects some of those costs from downtown merchants. Excess heat from the Sims plant previously was used for the snowmelt.
The plant also will be able to provide backup electricity when solar and/or wind energy is not available, Walters said. The BLP buys about 8 percent of its energy from solar sources, 8 percent from wind energy and 8 percent from landfill gas, he said.
The plant also would provide some of the excess generating capacity that the BLP is required to have, which it currently must buy from other providers at a cost of about $4 million per year, Walters said. And it would be able to provide emergency power to the city on the rare occasion it would be necessary, he said.
The facility would be a precast concrete structure built on the power plant’s existing foundation, Walters said. It would have solar panels on the roof to provide energy for the facility.
Plans also call for a “solar garden,” comprised of solar panels that customers could buy and then have their electric bills credited for the energy they produce, Walters said. There also is space for future batteries capable of storing electricity.
Officials have said customer rates will remain unchanged.
The island site has housed a power plant since the 1960s and previously was viewed as a “waste land” that once held a garbage dump, said John Eberly of Progressive AE, the design firm working on the project. Cleanup of the site will involve removal of some old coal ash produced by the power plant and even trash from the old dump, Walters told MLive.
The city is in discussions with state officials over how much of the ash to remove and other parameters of the environmental remediation. The “ash and trash” is in an area BLP would keep for its use, Walters said.
Because the facility would be built on the existing foundation, environmental cleanup should not delay construction of the plant that could be operational by June 2023, Walters said.
Plans call for a prior coal yard area to be cleaned up, a berm in that area removed and that section on the south end of the property turned into turned into wetlands that would be open for public use, he said.
Plans show docks, boardwalks and trails in that area – but those would have to be created by “somebody else,” Walters said.
The city operates Linear Park on the southern edge of the island, but it has been severely damaged by high water.
WZZM – GRAND HAVEN, Mich. — The Grand Haven Board of Light and Power and the Grand Rapids-based ProgressiveAE architecture firm have unveiled plans for Harbor Island after the old JB Sims Generating Station was demolished. The Board of Light and Power now owns the property and is cleaning up what was left behind from the Sims plant demolition.
A virtual community meeting was held Tuesday evening to inform community members about plans for the future of the site and to answer questions.
After remediation, a new operations and technology facility will be built to generate heat and power. It will also be home to the city’s snowmelt operations, which was previously powered by the Sims plant.
The project would consist of five reciprocating internal combustion engines with five natural gas-fired hot water boilers. The building will be made out of industrial materials, incorporating sustainable technologies like solar panels. John Eberly from ProgressiveAE said the building will be LEED compliant.
The site will also be repurposed to include wetlands and space that community members can enjoy.
The facility will produce less power than what the city needs and the majority of the city’s power needs will come from the grid, using resources from outside of the city. However, project leaders say the facility will protect the community from wholesale energy price spikes during “peak summer load conditions.”
The plant is scheduled to begin operations in 2023.
Tuesday’s meeting was the last in a set of three informational community meetings the Board of Light and Power hosted on the issue.