Naperville officials are continuing a months-long series of reports and discussions as decisions on the future of the Naperville Electric Utility hang in the balance.
City Manager Doug Krieger provided a high-level overview of an option that could entail the utility using a market participation with asset ownership model for energy procurement.
The presentation at the council’s Tuesday, June 16, meeting came on the heels of a council decision early this year to pause contract extension talks with the Illinois Municipal Electric Agency beyond 2035 as other possibilities are explored in more detail.
Alongside the vote, the council voted to host a series of presentations and a workshop. Prior presentations were held in April and May. Forthcoming presentations on other procurement options are planned in July and August before a more in-depth workshop takes place in September.
An overview of market participation with asset ownership
“The overall theme with asset ownership is, ‘If you own it, you control it,’” Krieger said. “You’ve got some pretty good autonomy.”
In his presentation, Krieger delved into multiple options for market participation with asset ownership. Among them:
- Natural gas generation: “It’s an efficient fuel choice because it’s reliable and abundant,” Krieger said. “Lead time ranges from 18 to 36 months and cost is subject to fluctuation since it’s significantly impacted by gas prices. There are constraints for natural gas generation, such as access and availability of the gas lines, with sufficient capacity, and there are zoning regulations and noise mitigations to consider, as well as EPA regulations.”
- Natural gas turbines: “Turbines have similar constraints as regular natural gas reciprocating, access to gas line, and the turbines will require, actually, larger gas sources,” Krieger explained. “There are zoning regulations, as well as noise mitigation that need to be considered, as well as EPA and wastewater regs.”
- Wind generation: “We have very little open land for a utility-scale wind farm here in Naperville,” Krieger said. “However, as an alternative, we could buy the energy output, via long-term contracts, from a commercial wind farm. These contracts typically run from 15 to 25 years.”
- Solar generation: Naperville currently hosts, through the IMEA, a 1-megawatt solar plant at the Springbrook Water Reclamation site. “We have very limited open land for a utility-scale solar installation,” Krieger said. “I would agree that a purchase power agreement for an off-site solar farm or field would be an option for us.”
- Batteries storage: “This is not technically an energy source, but an energy storage technology that stores electricity for later use and helps balance supply and demand on the grid,” Krieger explained. “We’re exploring options on what’s the best way to utilize battery storage within Naperville’s grid.”
In his presentation, Krieger also briefly touched on several additional options within the realm of market participation with asset ownership, many in early stages of technology or not feasible for the city.
Other options include traditional nuclear and small modular reactors and natural gas fuel cells.
Different considerations factor into equation
Krieger said a consideration of the market participation with asset ownership option entails a number of considerations, including the prospect of reducing costs, reducing the amount of carbon emission output, and improving local resiliency.
Big picture, Krieger added, “The goals of energy generation are to provide safe, reliable, affordable, resilient electricity to meet society’s energy needs.”
“Of course, with each different generation type, there are important considerations,” he said. “Depending on the choice, there is site selection, as well as other regulatory requirements, and the economics to consider. Also important to consider: How this generation type will fit within the grid and impacts other environmental factors.”
Council weighs in on full financial picture, batteries
Councilmembers weighed in on the information Krieger shared through his presentation at the recent meeting. Several elected officials on the dais asked for additional information, while others spoke favorably of one option.
Mayor Scott Wehrli said he would like a fuller picture of the cost behind each of the specific energy procurement scenarios outlined.
“There’s a lot of different options, but I don’t see a true calculation of those options,” Wehrli commented.
Krieger in response, said, “I think some of it you just do by process of elimination. … For a true generating asset, I think you’re really going to be limited to the wind, the solar, or the reciprocating gas.”
Councilman Nate Wilson shared similar comments: “I would like to see all of the costs involved … particularly if (assets) were farther away, which will obviously increase the costs.”
Multiple councilmembers spoke enthusiastically about the consideration of batteries storage as an option for procuring at least some of the electric utility’s energy via its technology. Krieger noted costs associated with batteries storage have decreased in recent years.
“That’s really exciting news to hear,” Councilman Ian Holzhauer said. “I think it is actually a great opportunity to bring value to really all the stakeholders that have come forward. … This is an immediate return on investment. It provides peak shaving. It does a lot of things that really stabilize rates.”
Councilman Ashfaq Syed offered similar sentiments, stating, “I’m happy to see that it took four years for us to come to the batteries. This discussion is great. I’m enjoying, I’m liking it.”
At face value, Councilman Benjamin White said he, too, was a supporter of using batteries storage technology, though he offered a caveat in his comments.
“The one thing I’m looking at, however: Charging the battery — we’re still under the coal-fed IMEA/Prairie State plant down there, as far as charging the batteries up,” White said. “That’s somewhat of a challenge for me.”
Residents continue weighing in on utility’s future
As has been the case at council meetings this past year, Naperville residents have continued speaking to their elected representatives about the city’s future in energy procurement for the electric utility.
At the recent meeting, Tim Ferritto, a leader with the Affordable Naperville organization, shared statistics about installed capacity, actual capacity, and accredited capacity for such generation types as nuclear, coal power, natural gas combined cycle, on-shore wind, and solar tracking.
Speaking to a bar graph he presented on the different generation types, Ferritto said, “You can see a big drop-off for solar and wind between installed capacity and actual capacity — and accredited capacity, as well. This reflects that they’re low-density, intermittent resources. That’s why their accredited capacity is so low, because it’s intermittent.”
Larry Kollasch, a volunteer with the Naperville Environmental and Sustainability Task Force (NEST) spoke to the council about his views on solar. Kollasch specifically discussed the retirement of coal-powered plants in Will County and further investments in solar.
In his comments, Kollasch advocated for solar power purchase agreements (PPAs) between third-party developers and property owners. Speaking to the arrangement, Kollasch said, “At the end of the day, (Will County leaders) decided for solar, and I think we should, too. Because, as sure as the sun comes up tomorrow, it will be raining pennies from heaven.”
Presentation links:
PDFs with the slideshow for each presentation are available through the city at the following links:
Market participation with asset ownership
Joint action agency participation
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