On September 23, 2013, KU filed a rate case with the Federal Energy Regulatory Commission (FERC) to significantly modify the terms and conditions of FPB’s and the other municipals’ current power supply contracts.
As a result, the Frankfort Plant Board (FPB) as well as other Kentucky municipals gave notice to terminate their contracts with Kentucky Utilities (KU) in April 2014. The termination of the existing contract requires FPB and the other municipals to acquire new electric service and begin taking that service as follows: June 1, 2015 for the Benham Power Board; May 1, 2017 for the City of Paris; and May 1, 2019 for the Frankfort Plant Board and the Cities of Barbourville, Bardwell, Berea, Corbin, Falmouth, Madisonville, and Providence, Kentucky.
On June 16, 2015, the Board approved the Interlocal Cooperation Resolution and Agreement which authorized and established the Kentucky Municipal Energy Agency (KyMEA). Also at that meeting the Board appointed and approved its representative and an alternate to the KyMEA Board of Directors. This action was taken by FPB and eight other municipals in order to realize the benefits from economies of scale in planning, purchasing, selling and operating power supply resources. On November 19, 2015 the Board also conducted a televised, public forum to discuss and inform our community about KyMEA and the progress being made on a new power supply.
Since that time the KyMEA Board and its consultant team have continuously worked to acquire a new energy supply. A number of major elements must be addressed before any new service can begin. Some (but not all) of those elements are identifying and procuring power supply resources, securing transmission service and establishing power delivery contracts between the municipals and KyMEA.
By way of the Kentucky model procurement code, KyMEA has identified key portions of the power supply resources that will be used during the first few years of service. While portions of the power supply portfolio for KyMEA have been established, there are still additional resources and contracts that will need to be worked out in the coming months and years. This resource planning and procurement will be a continuous process for KyMEA as contracts of varying terms and resource types, evolve and expire.
Applications, studies, system modeling and identification of possible upgrades that may be needed are currently underway to establish transmission service to each of the KyMEA members.
In an effort to establish power delivery contracts between the municipals and KyMEA, the KyMEA Board has approved and is proposing the all-requirements contract for FPB’s consideration. Staff and our consulting team presented the details of the proposed all-requirements contract between FPB and KyMEA at the regular July 19, 2016 Plant Board meeting. Staff and the consultant group firmly believe it is in our community’s best interest to approve the resolution and contract to become an all-requirements partner in KyMEA.
The Frankfort Plant board approved the all-requirements contract at the Aug 17 regular board meeting. The presentation from the Board meeting is provided here.