The West Texas Municipal Power Agency declined to a sign a nonbinding energy agreement with a Kansas wind farm Wednesday, continuing the search for an inexpensive source to power the region when WTMPA’s contract with Xcel Energy expires in 2019.
WTMPA is a joint power agency and municipal corporation comprised of the cities of Brownfield, Floydada, Lubbock and Tulia.
At a board meeting Wednesday, the agency decided against signing a nonbinding energy agreement with the wind farm to provide energy to the region for 20 years, beginning in 2013.
Colorado-based independent consultant Todd Hegwer urged the board to sign the nonbinding agreement.
The deal would have locked in per-megawatt hour energy rates for 20 years; additional costs for transporting the energy to the region would not have been fixed.
“I think you guys should look at buying this energy, because it’s cheap,” Hegwer said.
He said wind energy prices are extremely low. Costs range from just below $30 per megawatt hour to just above $50 per megawatt hour, depending on the wind farm providing the energy.
Hegwer believed a deal could be reached for less than $30 per megawatt hour.
In an interview, board president and Floydada City Manager Gary Brown estimated WTMPA pays between $.045 and $.0475 per kilowatt hour for electricity.
A megawatt is 1,000 kilowatts.
The nonbinding agreement would have meant paying about $.03 per kilowatt hour, not including transmission fees to deliver the energy, and any additional fees WTMPA would pay if transmission lines experienced a great deal of congestion.
During the meeting, Hegwer said WTMPA could sell the purchased wind energy – perhaps for a profit – from 2013 until the Xcel contract expires in 2019.
Lubbock Mayor Tom Martin, who is not a voting member of the board, questioned whether transmission lines, which would ferry the power, would even have enough capacity to deliver additional energy to the region.
Other board members expressed concern about whether WTMPA could sell the purchased wind energy for a profit.
In an executive session closed to the public and reporters, the board decided against signing the agreement.
“It’s not on the table right now,” Brown said of the proposed agreement after the meeting. “Too many unanswered questions.”
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