EPB is continuing its efforts to provide the Chattanooga community’s energy needs as cost-effectively as possible. A part of that is a contract with Nashville-based Silicon Ranch that the board approved on Friday morning.
TVA has agreed to allow EPB to buy up to five percent of its power from sources other than TVA and it can come from outside of the Chattanooga area. In the contract, EPB agrees to buy 33 MW of energy from a solar installation that will be constructed in West Tennessee at a price less than TVA’s average wholesale energy rate, said EPB CEO David Wade.
TVA and EPB are partnering with Silicon Ranch to build the facility, with construction projected to be completed in 2028. Savings of at least $1.6 million per year are expected. The contract will be for 30 years at a fixed cost. Mr. Wade said that he does not see that the price of power will be less than it is today. EPB will have no liability or responsibility if Silicon Ranch goes under.
For the past several years, EPB has been dealing with multiple supply-chain issues that have driven up costs for the utility, said Mr. Wade. One is the availability of transformers. Availability has improved, he said, however prices continue to be higher than they were pre-COVID. Problems started because of a shortage of workers and in the price of steel. Knowing that it would be better to have extras, EPB has kept a good inventory of transformers resulting in fewer problems than many other utilities in keeping up with the demand of new housing and restoring power after storm damage. He said that in talks with manufactures about the future, they do not expect prices will come down.
The cost of other equipment and vehicles such as bucket trucks and line trucks are also still very high and they continue to be hard to get. “It’s crazy how expensive the trucks are now,” he said. Bucket trucks are now in excess of $300,000 and lead times increase along with the prices. The costs change so much that items included in the budget cannot be planned. Now the budget is created and then things are purchased to fit into that amount, he said.
One of the ways that the utility is trying to contain rising energy costs for its customers is to utilize a variety of energy resources including microgrids and local energy storage, and is currently working to add 42 MW of storage to the current six MW already in place. Eventually, the storage will become about 150 MW that will supply 10-15 percent of the area’s peak demand for electricity. The storage also works to preserve power for critical community assets during outages such as the Airport and the Police Service Center. And local businesses are being asked to explore the opportunity for additional storage facilities in commercial areas.
President of EPB Ryan Keel updated the board on short term projects that are in the works. A project at the control center has just been completed. UPS equipment (Uninterruptible Power Supply) originally installed in 2008 was impacted by a storm in 2022. Internal damage occurred and components were replaced to keep them working, but at the same time, plans were made to replace both units. Those have now been installed.
Construction of the new Operations Center at Enterprise South that had been talked about for years is underway. Mr. Keel showed slides of the progress being made on the facility that will supply office space and parking for vehicles at night. The project is on target with both the timeline and the budget, he said. It is expected to be put in service next summer.
This year, EPB increased the vegetation management budget for protecting high power transportation lines and for routine trimming. Aerial surveys were used to identify trouble spots in order to increase reliability of the electric system, and some of the clearing has already been done.
And something that the community looks forward to each Christmas, the Holiday Windows in the downtown building, are close to being open. Work to design and build them off-site began in August and will be transported to the building and put on display. The tradition began during World War II, said Mr. Wade.
A longer-term project is maintaining the fiber optics network that the community relies on for communication. Mr. Keel said it has strong redundancy built in and that is important because people do not see what was prevented from happening. The network’s life expectancy is 15 years and equipment is being replaced while keeping the service working at the same time. Now electronics at each home is being replaced. That will cost $70 million over five years. It is significant that EPB has maintained and improved the system without raising rates for the Internet, said Mr. Wade.