Oct. 5—The general manager of Owensboro Municipal Utilities told city, county and other local officials Tuesday the water and power utility remains competitive in rates from other utility companies, and that OMU has plans to take on several new projects in the current year.
In particular, OMU will begin the demolition of the decommissioned Elmer Smith Station by taking down the stacks sometime between Thanksgiving and Christmas.
OMU officials will also construct a new water tower to replace the aging tower at Hillcrest Golf Course.
The utility also has plans, supply chain permitting, to have the entire city wired to its residential and commercial internet service by the end of fiscal year 2024-25.
General Manager Tim Lyons presented his "state of the utility" address to officials at the Cavin Water Treatment Plant on Kentucky 144.
"This is the first time in two years we have been able to have this meeting," Lyons said.
OMU provides the city with a "dividend" payment, which this year will be nearly $10 million dollars. The dividend makes OMU one of city government's largest sources of revenue, Lyons said.
On the agency's electric rates, Lyons said, "We are what I would consider to be very competitive in the region. That's a change from a few years ago."
OMU previously decided to stop power production and purchase power from Big Rivers Electric Corp. OMU has a contract to purchase from Big Rivers through 2026.
Power rates have stabilized through OMU's rate stabilization plan, which included closing the Elmer Smith Station. The plan was adopted in 2019. Closing the station meant the utility would save on fuel and environmental maintenance.
"There were many difficult decisions" when the utility implemented the plan. "It was very difficult to shut down the power plant" and reduce OMU staff, Lyons said.
The utility will conduct a rate study of its electric system later this year.
Lyons said inflation has increased the cost of doing business. After the meeting, OMU officials said the rate study will look at the effect of inflation on OMU's costs, when determining if the rate will change.
On the water system, OMU completed expansion of the Cavin Water Treatment Plant, bringing its treatment capacity to 30 million gallons of water daily.
The expansion "came in on budget, on time and during a pandemic," Lyons said.
The Hillcrest Tower replacement will be done with $2.5 million in American Rescue Plan Act dollars the city received from the federal government.
"We are in the beginning stages of this," Lyons said, and that, "with the funding, we are going to be able to cover most, if not all, of the project."
Plans for the future of the water system include creating two new water wells, and eventually expanding wells eastward.
A challenge on the horizon will be coping with new federal rules regarding lead and copper in drinking water.
"We believe we are putting a good plan together, and we will be ready to go when the rules are finalized," Lyons said.
There have been discussions about considering expanding OMU's internet service beyond city limits into the county, but the current focus is on getting the service available to the northwest, then the northeast, sides of the city, Lyons said.
"There are boundaries for our electric system and boundaries for our water system. But there are not boundaries for our telecom system," he said.
James Mayse, 270-691-7303, firstname.lastname@example.org, Twitter: @JamesMayse
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