Power Supply Contracts
As an extension of comprehensive planning, CMPAS delivers competitive and diversified power contracts that bring price stability, supplies local demands, and optimizes each utility’s existing resource mix.
“Our most recent power supply contracts provide favorable, long-term price certainty for approximately 75 percent of each utility participant’s costs,” said CMPAS CEO Chris Kopel. “The 12-year power purchase agreement (PPA) allowed us to protect each city from price volatility while optimizing their existing resource mix and meeting their on-peak demand.”
The recent PPA is an energy-only contract that comes from a financial institution. The power supply arrangement is different in several aspects from more traditional PPAs. For one thing, it will run for 13 years, not expiring until 2033.
“Seven or eight years ago, you’d be lucky to find a contract like this that went out for more than five or six years,” noted Kyle Haemig, CMPAS’ economist and resource planner. “This is 13 years and indicates how much the market has changed.”
The project-oriented, partial or full-requirements business model of CMPAS allows its team to create unique and specialized contracts to fit each community’s needs.
For instance, over a four-year period, CMPAS worked with 30 utilities in a coalition to assess their unique resource needs. Ultimately, ten of them signed a competitive power supply contract that included nine of CMPAS’ members and one affiliate in Iowa. Two CMPAS members also signed separate, related contracts that focused solely on summer needs to meet industrial load demand.
As fixed power prices fell in recent years, CMPAS’ strategy shifted from obtaining the same amount of energy every month to a fixed-price, long-term shaped product that more closely tracks energy needs according to the season of the year.