10/15/2014 Manitowoc Public Utilities Public Power in Wisconsin The “municipal electric utility” business model Nilaksh Kothari, P.E., General Manager Manitowoc Public Utilities, WI Public Power Origins Manitowoc Public Utilities • In the late 1890’s and early 1900’s, investor-owned utilities (for-profit) were busy stringing wires and lighting cities • Rural Wisconsin (and America) was not going to produce the necessary profits for energy companies to succeed in these areas 1 10/15/2014 Public Power Origins • Local government leaders recognized the tremendous economic development benefits of electricity and were not content to “wait” until it was brought to them • Wisconsin’s first community-owned electric utility was started in New Richmond in 1890 – 20 more formed by 1900 – 28 more by 1910 – 17 more by 1920 Status of Public Power in Wisconsin Manitowoc Public Utilities Manitowoc Public Utilities • There are 82 municipal electric utilities in Wisconsin. • Collectively: – $717 million annual revenues. – Distribute 11 percent of electricity in Wisconsin. – Serve 281,000 customers. 2 10/15/2014 Demographics of Public Power in Wisconsin Manitowoc Public Utilities • Average public power community has about 5,700 residents. • Customer base is a mix of residential, commercial and industrial. A small minority serve farms. Heavier industrial load in general. • Several communities have generation capability (base load, peakers, back up, renewable). Public Power Business Model Manitowoc Public Utilities • Public Power Utilities in Wisconsin are owned by the municipal corporation and governed by either a “commission” or a “committee”. • Retail services and rates regulated by the Public Service Commission of Wisconsin. • Wholesale transactions (i.e., power contracts) regulated by the Federal Energy Regulatory Commission. 3 10/15/2014 Municipal Joint Action Agencies Manitowoc Public Utilities • “Municipal Electric Companies” in WI (66.0825(4), Wis. Stats.). – “… a public corporation created by contract between two or more municipalities …” • Three in WI: – WPPI Energy – Great Lake Utilities (GLU) – Western Wisconsin Municipal Power Group/Upper Midwest Municipal Power Agency (UMPA) • Becoming the norm nationally. Public Power around the country Manitowoc Public Utilities • There are more than 2,000 public power systems in the U.S. (American Public Power Association). • The largest community-owned electric systems include communities such as Seattle, Los Angeles, Sacramento, Austin, Orlando, Long Island, Nashville and Memphis. • The entire state of Nebraska is considered “Public Power”. 4 10/15/2014 Benefits of Public Power for its Wisconsin customers Manitowoc Public Utilities • • • • • • Local control, local decisions Competitive electric rates (probably lower) More reliable system Local employment Faster response time to outages “Payment-in-lieu-of-tax” to the 82 Wisconsin public power communities totaled more than $19.2 million in 2011. • Not for profit Current Challenges for Public Power Manitowoc Public Utilities • • • • • Slow down in sales growth Planning forward with uncertainties Reliability Environmental regulations Workforce issues (succession planning; public employee retention) • Tight municipal budgets • Cyber and physical security 5 10/15/2014 Manitowoc Public Utilities • • • • • • • • Manitowoc Public Utilities Formed in 1914 18,000 Electric Meters 17,500 Water Meters $70 Million in Annual Revenues City of Manitowoc - Electric Service Territory Largest municipal utility in WI Ownership in American Transmission Company Only base-load generating municipal utility in WI Manitowoc Public Utilities 6 10/15/2014 Key Projects • • • • • Manitowoc Public Utilities Pilot Advanced Metering Infrastructure Replace SCADA Financial System replacement New Phone System Replacement of IT Infrastructure • Investment in Infrastructure Manitowoc Public Utilities Thank you! Questions? 7
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