City supports effort to form new utility

Leader Reporter

In an effort to keep the cost of power down, Shawano will join other Wisconsin municipalities in the formation of a municipal electric company.

"In the future, we will be able to do our best to keep the price of power down," said Shawano Municipal Utilities superintendent Dan Dasho. "We are concerned that the price will go up. We hope this will help it go down."

The Common Council agreed Wednesday to enter into contract with other Wisconsin municipalities for the formation and operation of the municipal electric company called Great Lakes Utilities.

"The purpose is to aggregate our loads together so we are able to be a bigger customer and perhaps find better suppliers for wholesale electric power," Dasho said.

Currently, Badger Power Marketing Authority works as a municipal electric company to the cities of Shawano and Clintonville. They buy power from Wisconsin Electric Power Company and sell it to SMU and the utility in Clintonville, he said. SMU's contract with Badger Power ends in 2002.

In attempts to find alternative suppliers or to look for ways of meeting the electric supply needs for both Clintonville and Shawano, Dasho said the utility found the wholesale market for electricity to be very tight with no competition. By forming the Great Lakes Utilities in the wholesale market, they hope to improve competition.

Future electric prices could go up because Dasho said the transmission system between Wisconsin, Minnesota, and Illinois is contractually used up. With no additional capacity to be brought in to serve the needs here from outside the area, Dasho said SMU's current supplier may or may not sell them power and if they do, the price could increase.

But by combining with the loads of other municipalities, SMU will be able to find better customers to supply power to the area.

With Clintonville and Shawano, Badger Power became a municipal utility that bought power in a bigger market than each city separately could not. Dasho said Great Lakes will just be a bigger version of Badger Power.

"If we join together with the other municipals, we will have the opportunity to put our loads together and shop for bigger wholesale suppliers who wouldn't be interested in the city of Shawano's load or Clintonville's, but they may be if we tied it together with some other municipals," Dasho said.

Other cities interested in joining include Oconto Falls, Marshfield, Rice Lake, Medford, Plymouth and Manitowoc.

Joining a group that includes cities like Manitowoc that has been in the wholesale market for years, buying and selling power, could be an advantage for Shawano, Dasho said.

"It could be to our benefit to join with a company like that in the future when looking for wholesale suppliers," he said. "They have a lot of expertise."

SMU will still exist with Shawano joining the association, Dasho said. Shawano will just be a member of this cooperative and as a board member, the city isn't required to do anything, but will have the opportunity to buy power as they decide to.

By joining, SMU and other utilities can get better prices on buying power than if they were not in the group, he said.

Badger Power will continue to supply SMU and will buy from utilities including Great Lakes. As a board member, Dasho said SMU will look for opportunities to benefit Badger Power in terms of power supply.

Membership with Great Lakes should start in February as the other city council's agree to enter into contract this month, Dasho said, and last for 18 months, after which the city can give notice and pull out six months later.

Membership for Shawano will cost about $18,000 from SMU. Everybody pays a share based on the number of customers they have, Dasho said.

By Amy Weaver
Article category: