Newberry City Council voted last Tuesday to request the Piedmont Municipal Power Agency (PMPA) market 6.0 megawatts (MW) of Newberry’s allocation of its Catawba Nuclear Station Entitlement from PMPA.
Motion was made by Councilperson Lemont Glasgow and seconded by Councilperson David DuBose. This motion only gives PMPA the permission to move forward with listing. Council will still need another motion down the road to sell.
Mayor Foster Senn shared background on PMPA and the 10 cities, including Newberry that make up its participants. PMPA owns a 25% share of Catawba Unit #2.
The City of Newberry’s share of the Catawba Nuclear Station is 29.025MW. The city has an excess of power most days and beginning in 2029/2030 must pay for that excess baseload power due to termination of PMPA contracts.
Senn said that the city had an excess of power as small cities haven’t grown significantly as well as having a reduced industrial demand on the city’s system. This excess is currently purchased by other PMPA participants but will change over the next few years.
In an analysis done by engineers, the City of Newberry currently has an excess of 6.024MW of excess that isn’t needed today and projected to be excess in the future. If sold, Senn said the city would still have 23MW leftover of the total 29.024MW allocated.
Utility Director Scott Motsinger described the city’s annual peak, the maximum amount used each year, is 10.571MW.
“That’s the capacity today that we have to have available to us,” he said.
Senn shared projections of before and potential after the 6.024MW sale, which he said the City would see a significant savings in purchased power costs.
Even if the City of Newberry had an increased demand in the future, Senn said they would still have an excess baseload and could buy additional supplemental power to supplement the low-cost baseload from Catawba.
For example, he said the city currently has 90% power from Catawba and 10% supplemental power. A possible future scenario with a lot of growth, he said, has been studied and even with a shift in the baseload/supplemental makeup to 80% Catawba and 20% supplemental power, the City of Newberry would still have one of the lowest electric rates in South Carolina.
Utilities Updates
Also under new business, Motsinger presented updates from the utility department and priorities for the upcoming fiscal year.
The City of Newberry utilities department makes up 61% of the city’s total budget. Motsinger shared departmental challenges such as recruiting and retaining skilled workers, succession training, and maximizing the capacity at both their water and wastewater plants.
Motsinger shared with council several grant-funded projects to include funding from a South Carolina Infrastructure Improvement Program (SCIIP) grant that will aide in several updates to include the Scott’s Creek Interceptor Sewer Line, Kraft Interceptor Sewer Line and Bush River Sewer Line.
Monies from a Community Development Block Grant (CDBG) and Rural Infrastructure Authority (RIA) grant were also awarded to the city, Motsinger said. Funding from the RIA grant will be used to upgrade the aged influent pump station at the city’s wastewater plant.
An ordinance was then approved by council to amend the Wholesale Power Cost Adjustment Schedule. Motion to approve the ordinance was made by Glasgow and seconded by Councilperson David Force.
Motsinger said that Hurricane Helene had stressed the utilities department financially and that they were looking at placing a temporary rate increase to help bridge the financial gap. Talking with Newberry Electric Cooperative, City Manager Jason Taylor, said they had instituted something similar.
The City of Newberry is requesting a 5% increase that will take place during the months of March – June of this year. This can be found on the customers’ bill under the Wholesale Power Cost Adjustment (WPCA).
“The usage is down this time of year, so it shouldn’t be a major hurt from that perspective,” Motsinger said.
Hurricane Helene, Motsinger said impacted the city’s electric budget by $769,597. He said they had paused projects and put off the purchasing of equipment to make up the difference. However, it still left almost $400,000 not covered, he said.
“We looked at what we could do in the interim to try to get by smoothly the rest of the year,” he said.
Motsinger shared they had hired Witt O’Brien’s to guide the city’s FEMA reimbursement process, and that the city’s data collection had been completed and submitted. The City of Newberry total FEMA costs are about $1,758,000 in reimbursable expenses. Motsinger shared that number was the entire city, not just the utilities department.
“Reimbursements will range from 75% to 100% depending on the type,” he said. “Time for reimbursements can be stretched out up to at least 6 months.”
During the temporary rate increase period, Motsinger shared with council the revenue recovery is expected to be about $80,000 per month or $320,000 for the rate period (March-June), leaving the city approximately $80,000 short to cover expenses.
“We felt like this was about the right number to not be too impactful and during the shoulder months where uses wouldn’t be that great so as not to spike bills for our customers,” he said.
The average city residential account uses 825kwh monthly, he said, which would add $6,60 per month to the average residential account. March-June are considered shoulder months as the weather is typically more mild.
Councilperson Clay Smith inquired as to once the reimbursement monies were released to the city from FEMA, what would be done with the money that had been collected from customers during that four-month period.
Motsinger said at this time it was hard to say and that it would be something they’d need to look at in several months as they came to the end of that increased timeframe; that ultimately council would have the final decision.
Glasgow shared that council had worked hard over the years to keep the rates down and that he felt comfortable with this just for a short period of time. He shared that the city had only passed on the cost they’d incurred from PMPA for many years.
“It’s been a long time since we’ve actually raised rates,” he said.
As a final item of new business, council reaffirmed the city manager’s contract with a motion made by Glasgow and seconded by DuBose.
Senn shared advice he’d received from Interim City Manager Ed Driggers based on the Cunningham vs. Anderson County case in which it was said that one council, meaning the elected body, the contract that it had with its administrator did not bind the next council.
Based on this advice and that received from the city’s attorney, Senn suggested council reaffirm Taylor’s contract as they had a new councilperson, Smith on board.
Project/Business News
Following new business, Senn shared that council had some projects and business news they’d like to bring up including the Backstreet project, highlighting the former black business district during segregation. Senn said that some towns as of recent had done a good job memorializing that and that council would like to do that in Newberry.
“There have been community meetings for a few years of those wanting us to do that,” Senn said.
Councilperson Carlton Kinard has worked with Anne Smith with the Newberry Opera House, Senn said to acquire grant funding for a mural, which they were excited about. Kinard shared that there were some potential properties on Friend Street that they’d like to look into and see if they could be acquired.
Taylor mentioned that he’d like some community input and while staff had kicked around some ideas, it may be good to appoint a committee.
The City of Newberry currently owns a piece of property on Friend Street that is used for parking that was discussed as a potential location. Taylor said city staff had asked a landscape architect to look into that area to see what ideas they may have. Several of these ideas were shown during the meeting.
Other discussions included the potential of a pecan orchard park. Located off of Drayton Street in Newberry, the city received an offer to have the property transferred to them, with the condition that this remains a passive park. Taylor said the city could potentially develop an entry drive and smell shelter for visitors. Ideas were discussed as well on the consideration of planting fruit trees or bushes to create more of an orchard feel.
Glasgow shared that a meeting had been held with the owner of the Bergen’s building in town, Bob Shirey, in which the city would like to purchase the property for $100. Glasgow said verbally, he agreed to sell the property with the condition that when the city was upgrading to be sure the adjoining wall between the property and his market was done correctly.
Senn said he was appreciative of all Shirey had done for Newberry.
“We’re interested in looking into that and making it better,” he said.
Other discussions included potential redevelopment of the Edward Kyzer Newberry Firehouse Conference Center. Taylor said folks had approached the city with interest in using the building as a potential restaurant space.
While the building does not have a full kitchen in the basement, Taylor shared it did have what was essentially a catering kitchen at this time and would need some modifications to make something like that work depending on the route the city decided to take.
City Council will hold their next regular meeting on Tuesday, March 11 at 7 p.m. in the council chambers at City Hall.
