Repairs for Light Plant Turbine, LUB Discusses ARPA Contract

Lamar Light Plant Repowering Project, East View

An original wind turbine gearbox owned by Lamar Light and Power needs to be replaced, according to Superintendent, Houssin Hourieh.  The turbines, located several miles east of Lamar, are now a decade old.  The T-1 turbine is offline because of an abnormal amount of metal shavings found in the unit’s oil filter.  The estimated cost of a gearbox, according to Hourieh, is from $150,000 to $160,000.  He estimated the labor costs at $19,000 and a crane will have to be rented for the project.  “It should come to around $300,000 for all the repairs and we will have to bid out the project,” he told utility board members during their bi-monthly meeting this past Tuesday, July 24.  An analysis of the gear box damage will be assessed to determine the cause. 

 Board member Mike Bryant suggested the board investigate the cost of purchasing a bore scope machine used in the analysis.  He said the purchase might save money when weighed against future rental costs. 

Lamar Wind Turbines

Wind turbine performance fell off 11.8% for the first two quarters of 2013, compared to the same period last year.  The three turbines have an averaged capacity factor of 33.2% which is 3.31% lower than 2012 for 6473 MWH of electricity for 2013.  The turbine in Springfield continues to outperform the others, showing an average capacity factor of 45.86%. 

The Superintendent reviewed tracking information for electric customer meters as their numbers have been recorded every May since 1999.  There were 5685 meters for 2013 while a high point occurred in 2003 with 5836.  The lowest count was 5635 meters in 2010. 

The year to date income statement for the Lamar Light Plant has total operating revenues for 2013 at $6,056,537 and total operating costs are $5,453,943 for a gross operating income of $602,594.  When the non-operating revenues and expenses are factored, there is a net loss of $359,288 year to date.  Retail sales are down approximately $594,351 or 9% comparing June 2013 to June 2012.  Hourieh explained this is due to the ECA, Electric Cost Adjustment impact when compared to last year. 

There will be a vacancy on the Lamar Utilities Board as of July 31, 2013.  Board Chairman, Don Steerman indicated that he has decided not to re-apply to retain his seat.  The city will make plans to advertise the open position on the board. 

Board member Ron Cook asked if there would be some special meetings scheduled in the near future to begin discussions on the light plant’s budget for 2014.  Cook also asked if the board can start looking at the Light Plant’s contracts with ARPA, Arkansas River Power Authority.  “I’d like to review everything we do with ARPA,” he said.  Cook also suggested the members look at what steps could be taken to bring the plant back online in times of a power emergency.  He was referring not to the Repowering Project coal plant which will be offline until 2022, but the city’s generator, Unit 6, which could run independent of the coal plant.  Mike Bryant, board member, recapped an earlier board conversation which noted that for $5 million the natural gas generator could be brought online for just Lamar area customers in case of an emergency.  

Cook furthered the discussion regarding the position the light plant is in because of its contracts with ARPA.  Cook stated he was discouraged because he believed, “ARPA’s got us backed into a position now that Lamar Light and Power can’t do anything unless ARPA controls it.  And it’s the wrong position to be.”  Cook wanted to know what it would take to make Unit 6 operational.  He added that as a board, all they’re doing is just approving monthly bills.  “We can’t produce power, we can’t do anything unless it’s under ARPA supervision, and I think it’s wrong.”  Cook suggested that as ARPA is suing the boiler manufacturer, Babcock & Wilcox for performance problems, the Light Plant should take a look at their legal options against ARPA.  Cook added that right now, the citizen’s of Lamar can’t take another rate hike on their electric bills.  Hourieh noted that a rate hearing has been set for next year.  ARPA will continue to purchase electric power for its customers, including Lamar, from outside sources until 2022 and the Repowering Project will stay offline until that time except for testing purposes.  The contract with ARPA runs until 2045.

By Russ Baldwin