Thursday, September 22, 2011
Northcentral sees growth
By SUE WATSON
With consolidation of its two facilities into one 20-acre site and 70,000-square-feet building at 4600 Northcentral Way in DeSoto County, Northcentral EPA is poised for another 50 years of growth.
Kevin Doddridge, executive director of the power cooperative, reviewed future prospects for growth at the August membership luncheon of the Byhalia Area Chamber of Commerce, held at Craw de Lis in Byhalia.
He said the old Northcentral building in Byhalia is for sale and the co-op will keep the community building open while it also considers opening a payment center in the town. Citizens who pay by cash or money order have requested a drop box in Byhalia.
The cooperative was financially sound at the end of June – the last fiscal year – and saw a 7 percent kilowatt hour sales growth and a 6 percent increase in average power consumption. The EPA is ranked in the top 7 percent on ability to cover its obligations and on the bottom 5 percent in total debt, nationally.
The board of directors approved an $82 million budget for this year with $72.2 million going for wholesale power costs. Northcentral will spend $3.6 million in system improvements and will work to support new industry, the I-269 State Aid Project, and improvements at Matthews Corner and Warsaw Road, Doddridge said.
He reported on damage to the Tennessee Valley Authority’s transmission system during storms this year – the most damage in its history – that carried a $200 million price tag.
Overall, the system has held up to the high thermal days of summer and performed well, he said. The automatic meter reading system took a hit from lightning, he said.
In terms of growth in power costs or rates, Doddridge said TVA has said its wholesale power rates to distributors will increase by 2-2.5 percent.
Northcentral’s rates are only 2 percent higher than a year ago. The company has separated its TVA fuel cost adjustments from its base rate structure in billing. Rates are expected to become more and more complicated, he said. A TVA fuel cost adjustment rate increase in October will be offset by seasonal usage decreases (cooler weather). Northcentral hopes to keep the rates under a 2 percent increase over the next year.
Time of use rates could be implemented as early as October 2012 across the valley, Doddridge said.
Northcentral is expecting growth in large consumers of power – industrial/commercial – as well as residential use.
On the horizon, electric service which is available to only one-third of the world’s six billion people is expected to become available to areas that have been going to bed at sunset. And consumption in the U.S. is also expected to increase by home users.
In order to satisfy the 1.5 percent growth in electricity demand in the U.S. over the next 15 years, Doddridge said it would be necessary to build 50 more nuclear reactors, 261 more coal plants, 280 more gas plants and 10,000 megawatts of renewable energy. To do this, he said the U.S. needs to take advantage of its domestic sources of energy.
“Historically, the resources were food, water, or salt – resouces that fueled the tools of trade like livestock,” he said. “Those who had it could use it or trade it for other goods and services. Those without were at the mercy of those who had, and wars and uprisings would break out as groups took up violence to get what they needed.”
Fuels needed today are those that drive engines, manufacturing and transportation, Doddridge said. But federal regulations are choking the power industry, he said, forcing the closure of some plants like coal-powered generators.
Capacity to generate will be short by about 4,000 megawatts by 2020, he said. When demand exceeds capacity, those shortages may not be made up by alternative (renewable) sources, he said.
The future will require that the customer conserve energy by looking for ways to reduce energy waste and to take advantage of seasonal rates and time of use rates, once they are implemented.
Northcentral will continue to address its mission to provide reliable power at reasonable rates to its customers, he said.
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