City Council Needs to Give BLP a New Mandate

Below is my column in the Wednesday, May 5, 2021, edition of the Grand Haven Tribune. You can read it on their website online here. 

In last month’s column, on April 7, I wrote about how I believe the Grand Haven Board of Light & Power (BLP) should pause their plans to build a $46.6 million dollar natural gas-burning power plant and office building on Harbor Island to replace the local generation ability lost when the coal-burning J.B. Sims power plant was shut down.

Like many in the community who have been pushing against this path forward, I was contacted by BLP General Manager Dave Walters who, as one might expect, disagreed with my opinion column and sought to provide an alternative perspective. I met with Walters on Zoom late last month, along with Vice Chairman Gerry Witherell, to discuss the current plan and what has brought the BLP to this place.

I have not changed my fundamental view that the current approach of the BLP is fundamentally flawed and must change course. What I want to do in this column is to try to give the BLP a fair shake – but also to be clear about my continuing concerns about the current path being taken in our community.

Also, I have a hunch that this situation is an example of the increasing polarization of our culture and community, the inability to see the entirety of the perspective of those with whom you disagree, the inability to recognize the spectrum of opinions instead of just arguing with who you think are your enemies. I want to acknowledge that Walters made several points in the course of our conversation that are indeed important and are often missed in this current community conversation.

First, Walters had long been an advocate for shutting down the Sims plant. Furthermore, when the board of BLP made that decision in 2018, not all community residents responded with the joy that I did. For some, they did not have the concerns I have about the environmental impact of a coal-burning power plant. For others, they feared community vulnerability with the loss of local generation of power to supplement what we can get on the grid. Regardless, for the many in the community who are currently urging the BLP to step back from plans to build a natural gas plant, there are others in the community who were opposed even to closing the coal-burning Sims plant.

The second essential point is the demand to build something didn’t arise from the BLP itself, it arose from members of our community and our own City Council. The 2018 report from Burns & McDonnell argued that “it is less expensive for GHBLP to source all energy and capacity from the MISO (Midcontinent Independent System Operator) network than to dispatch from a local on-system resource.” However, the town halls at that time found that 53 percent of the 134 residents who attended the meetings believed that some form of local power generation was important, with 40 percent of those present believing it was very important. The November 2018 City Council resolution that authorized the decommissioning of the Sims plant also required that the board of BLP be willing to commit “that by June of 2023, Grand Haven will have the capacity to generate a majority of the local electricity within the service area.”

When the BLP came back to City Council for plans to do what the council asked – and what a majority of residents who were surveyed asked – the updated report from Burns & McDonnell in June 2019 found that the proposed 36-megawatt (MW) plant would actually be cost prohibitive. Burns & McDonnell recommended the Board do further analysis and “evaluate alternatives for power generation, utility operations and Harbor Island redevelopment.”

Following this recommendation, in 2020 the Board contracted with Progressive AE to figure out a new solution to the issue of power generation and distribution in the city of Grand Haven. Given the articulated community desire for some local power generation, Progressive AE recommended, in their September 2020 Master Plan, that the BLP construct a “12.5-megawatt combined heat and power plant (CHP) using natural gas engine-generators.” To be clear, this recommendation was not based upon an open question of what is best for power generation and distribution given geographic and economic realities. Rather, it was how to do what the BLP wanted to do – build a plant to provide local power generation – based upon their understanding of perceived community needs.

Finally, it is important to note that the proposed 12.5-MW natural gas-fired plant would operate as a “peaker plant.” That is, the majority of the time the BLP would continue to operate as it has since the Sims plant shut down – distributing power it purchases off the grid. The plant would only operate when the cost of purchasing off the grid is more than the cost of generating with the natural gas plant. It would also provide a backup if there was a significant failure of the grid. There is also possibility of this plant converting from natural gas to hydrogen.

Along these lines, the BLP has been working to increase the amount of renewables in our energy purchases. Last year, according to Walters, they increased the percentage of renewables in the portfolio 50-60 percent. In the first part of 2021, renewable purchases are up again, currently 36 percent compared to the previous year. As of our conversation, more than a quarter (26 percent) of our current portfolio comes from renewable energy sources. What is troubling, however, is that methane landfill purchases are included in those numbers. While this is a “renewable” power source, it is toxic and far from clean and green – which is what most people assume is meant by the term “renewable.”

However, like I said, there are still issues I see with the approach being taken. First, I believe the City Council erred when they directed the BLP to ensure we continue to generate power locally. The two town halls the BLP hosted had a total of 134 residents attending – that is 1.2 percent of the citizens in our community. And even then, it was only barely a majority that desired local generation. I would be curious if a robust community survey would still express a desire for local power generation, particularly based upon fossil fuels. I also think that City Council should engage in that survey and consider giving new direction to the BLP.

Furthermore, though there are many energy companies that argue that peaker plants are an essential part of the future of power generation, providing a backup and supplement to the increasing use of renewables, the technology continues to change. An analysis by Physicians, Scientists and Engineers (PSE) for Healthy Energy in 2020 found that the increasing power and decreasing costs of battery storage are increasingly more effective than peaker plants. A report by the University of Minnesota back in July 2017 found that “storage plus solar already could be more cost effective than peaking gas plant.” The same study found that, “Beyond 2022, storage was found to be more cost effective than a simple cycle gas-fired peaking plant for meeting Minnesota’s capacity needs.”

In our conversation, Walters was clear that batteries are absolutely an essential part of the ideal BLP energy portfolio. However, he insisted that batteries are best for “daily balancing and not for seasonal balancing.” He also several times pointed to the failures of the grid in Texas. However, the state of Texas is not fully integrated in the national grid and, as BLP-contracted studies note, the MISO grid we participate in has an excess of power and is certainly stronger than the grid in Texas given its interconnections with the rest of the country. And, of course, the reliance upon natural gas for peaker plants is, for some of our residents, unacceptable due to its connections to fracking and environmental concerns about that and any power plant generation that uses fossil fuels.

And, despite the BLP claims that their current proposal is simply following the directions of the City Council, remember that the original resolution from the council allowed the closure of Sims so long as “Grand Haven will have the capacity to generate a majority of the local electricity within the service area.” By the BLP’s own admission, this new natural gas-fired plant will not generate a majority of our local electricity, but only will operate very rarely.

So, where does that leave us as a community here in Grand Haven? I remain convinced that we need to have a true and robust conversation and study. For that to happen, City Council needs to issue a new mandate to the BLP that requires they engage in an independent study of both community desire and effective power distribution and generation in our own time and place.

Despite the views of the BLP, I do not think an adequate conversation nor an adequate study has yet been undertaken. The entire current process is based upon the idea that our residents want local power generation – an idea that is based upon two town halls with minuscule attendance (attendance that is dwarfed by those who have signed the petition that Grand Haven Energy has created) and a mandate from a City Council that was not re-elected.

In 2021, the BLP held what they called a “community meeting,” which actually was a meeting that simply allowed any individual to speak for up to three minutes. Following that public comment, the board voted 3-2 to not further involve the public and those comments made in the session were never addressed.

Finally, the first study we did found that there was not a need for local power generation. The second study was specifically asked to find a way to make it happen – and they did precisely that. All that to say, it is time for a study that looks at all the property available in our city, with an eye to the emerging edges of the energy market and finds what truly is best for our lakeshore community. I believe this is what our community wants. It is time they are asked in an open and robust manner.

I want to be clear, I believe the BLP has been put in a tough spot by an outmoded mandate from City Council and by residents in our community who want local generation no matter the environmental implications. At the same time, I urge the current members of our City Council to hear those in our community who think we are not moving in the right direction. It’s not too late to change course.

The Rev. Dr. Jared C. Cramer, Tribune community columnist, serves as rector of St. John’s Episcopal Church in Grand Haven. Information about his parish can be found at www.sjegh.com.