Bay City will purchase a chunk of its electric power from a Gratiot County wind-turbine farm.
The Bay City Commission on Monday, Aug. 19, voted 7-2 to buy $18 million in electricity generated by the Beebe Community Wind Farm near Ithaca during the next 20 years.
Bay City Electric, Light & Power must comply with a state mandate to provide at least 10 percent of its electricity from renewable energy sources by 2015. The utility has 20,200 customers.
Phil Newton, the city’s electric utility director, has called the contract and its accompanying price a good deal because the cost is lower than he’s seen from other wind developers.
Other communities have already purchased Beebe’s wind farm energy include Holland. The West Michigan community joined four other member utilities of the Michigan Public Power Agency earlier this year in purchasing 26.4 megawatts of power from Beebe.
Bay City’s agreement would be to purchase 4.8 megawatts through the MPPA, a supply agency the city and other smaller municipalities belong to as a group. The initial year will cost Bay City about $45 a megawatt hour, for a total of $700,000.
Commissioners Elizabeth Peters and Chad Sibley protested the length of the agreement. Peters wanted to see an opt-out clause in the contract.
“Energy prices are going to go down,” Sibley said. “At this point, locking (the city) into a 20-year commitment might not be in our best interest.”
Newton previously said Bay City’s 2013 average cost to purchase power was $59 a megawatt hour. Landfill gases run at $85 a megawatt hour and coal-based power costs the city about $54 per megawatt hour, he said.
The cost of the wind-turbine energy increases during the contract’s 20-year term, rising to about $72 per megawatt hour in the final year.
Workers at Siemens Energy, a plant in Hutchinson, will build portions of wind turbines for a project in the northwest United States.
Siemens has an order from Portland General Electric company, a public utility in Oregon.
Hutchinson workers will build the nacelles and hubs for 116 wind turbines. Crews will start installing the wind turbines in 2014. Once the project is completed, it’s expected to generate enough power for 84,000 households.