Who is Truly Misinforming? (Part 4)
a FAQs Report sent by the Office of Speaker pro tempore Chuck Clemons. And my commentary. Seriously though How long can the City of Gainesville keep pretending?
This week has really been a busy week, and I know I have left everyone hanging. I apologize, but as I am getting ready to better my life for myself and my family. My husband and I both have made a decision to further our education while still home schooling the boys. And since this is the last of the series I will post a picture of the cutelings.
12) Isn’t the claim that GRU rates have risen 25% since 2018 false?
Actually, they have risen considerably more. The purchase of 1,000 kWh – Residential rates for March 2018 came in at $121.00. By March 2023, that same 1,000 KWH would cost a GRU customer $182.63, an increase of 51%
(https://assets.noviams.com/novi-file-uploads/fmea/Rates/2018/2018_march_rates.pdf) (https://assets.noviams.com/novi-file-uploads/fmea/Rates/2023/2023_march_rates.pdf)
Again, Bryan Eastman in his substack article “Correcting the Misinformation on GRU”. Contends that that claim of a rise in GRU rates of 25% is false.
He argues that the “GRU base rates in November 2018, when the election took place were $87.87, today they are $102.63, a 16.7% increase.”
Well, to begin with, he is using the “base” rate, hence the word “base.” A ratepayer can’t call up GRU customer service and say, “Put me down for the base rate.”
In order to get the total rate, that is, the one which gives GRU ratepayers sticker shock - the base rate must be added to the fuel or cost adjustment for the total rate paid by the customer. That fuel or cost adjustment is the cost of fuel for the utility’s system to generate power (natural gas, petroleum, coal, and biomass feedstock) – as the cost of fuel spikes, so too can the fuel adjustment on a rate payer’s bill.
However, Eastman holds harmless the City Commission from any increase in the fuel adjustment, stating, “the City Commission doesn’t vote on fuel adjustment, we vote on base rates. Fuel adjustment is a passthrough cost that has risen due to the rising costs of natural gas.”
He is correct, in part. The City Commission does not control the wholesale price of fuel. It does, however, make management decisions as to how exposed and negatively impacted its ratepayers can be in the event of such price spikes.
Before we go any further, one thing has to be established – Of the 5 Investor Owned, 18 Cooperatives, and 34 Municipal utilities, none is less liquid than GRU.
For rate and fuel adjustment decreases, the IOUs must seek approval from the Public Service Commission; the Electric Co-ops must seek approval from their Boards; and MOUs seek approval from their city commission, or in some instances from an Authority.
(https://www.seealliance.org/wp-content/uploads/Florida-UEEP_Update_121019.pdf)
In GRU’s case, the fuel cost adjustments portion of a customer’s bill is dictated by Gainesville city ordinance (§ 27-28. - Electric system fuel and purchased power adjustment.) All utilities can choose to treat fuel costs as pass-throughs, however, they cannot profit from them. Spikes in the cost of fuel are to be expected.
As such, many utilities take steps to soften the blow of such spikes to the ratepayer.
One way is by setting aside capital into a rate stabilization fund to supplement the fuel adjustment costs to the customer. With more liquidity comes a greater means of making those funds available. During the recent spike in the cost of natural gas, GRU’s fuel stabilization fund quickly dried up, leaving its customers bare and “passing through” the full increases, on top of the already high base rate.
Another method most utilities use to protect their customers from feeling the adverse effects of rising fuel costs is to employ state-of-the-art infrastructure, and best practices, aimed at efficiency. The objective being to generate the optimum power per dollar spent. Upgrades, capital investments, and new technologies, all can result in greater efficiency, which means less fuel cost per kWh; the savings of which can be passed through to the customer.
What has Gainesville’s city commission done to optimize the fuel cost efficiency of GRU’s system? Very little – Coal, petroleum, and natural gas have been viewed as necessary evils. While they have been the workhorses of the system, the choice has been made to limp them along until the holy grail of renewables is realized.
From the GRU website –
A large portion of Gainesville's energy supply is produced at GRU's Deerhaven and John R. Kelly generating stations. These plants, though well-maintained, are aging. Similar to older-model cars, maintenance costs and the risk of a breakdown can increase as units age. The biomass plant helps ensure that the community is prepared as older generation units are retired.(https://www.gru.com/TabID/3826/Default.aspx)
Misguided decisions made by city commissions past and present, in pursuit of an agenda, have kneecapped GRU. The utility has no flexibility to offer relief to their ratepayers through rate stabilization during volatile spikes in fuel costs, nor do they have the needed capital investment, nor the will on the part of the Commission, to make their system more efficient.
Faced with the same set of market circumstances, Electric Co-ops and other MOUs have consistently charged their customers lower rates than GRU. So too have the IOUs who have, all the while, paid franchise fees and property taxes, and yet still they manage to make profits and pay out dividends to their shareholders.
In March 2023, not only was GRU’s base rate almost $11 more than Tallahassee Electric’s ($102.3 vs. $91.75), but somehow, a GRU customer bore a nearly $45 greater fuel cost ($80.00 vs. $35.19) in order to be provided the same 1,000 kWh.
Oh, and remember that period we mentioned between March 2018 and March 2023 where GRU’s rates went from $121.00 per 1,000 KWH to $182.63, for an increase of 51%? Tallahassee Electric went from $112.81 to $126.94, for a moderate increase of only 12.5%.
(https://assets.noviams.com/novi-file-uploads/fmea/Rates/2018/2018_march_rates.pdf) (https://assets.noviams.com/novi-file-uploads/fmea/Rates/2023/2023_march_rates.pdf) (The Office of Speaker Pro Tempore Chuck Clemons)
I seriously have to wonder, was Bryan Eastman even affected by the rise in rates? I mean, to say the rates hadn’t even risen 25% is preposterous. The amount of people that couldn’t even pay their bills in full was crazy. The Non-profits were tapped out, and are still having a time keeping up with the many that continue to need help. As an admin for Customers for a better Gru I continue to see not only the jacked up bills from rates, but also, misreads, or no read as it turns out, I see people that haven’t gotten a bill in months and that continues to happen, I see just out right things that I can not even explain that look like the utility is just robbing the customer, And finally I see those that have auto-pay and GRU has taken three times what the bill was and then refuses to reimburse the money. Those customers, the ones that they took so much from, that is their money to pay other bills. GRU really is robbing them. Honestly that rule, that it can only be credited to the account needs to be dealt with, there does need to be compensation for those people. Now Bryan Eastman does say that the commission only votes on the base rates, they also vote on the customer charges and Here you can see all those rates 27-27 in appendix A (of course if interested you can see all the fees of the city)
13) How can folks and entities criticize the City Commission’s governance of GRU and push to have it placed in the hands of an Authority, when some of them were on record in support of the construction of the Biomass Plant which is a source of many of the utility’s financial difficulties?
Easy, because they subscribe to the adage, “fool me once....”
Bryan Eastman in his substack article “Correcting the Misinformation on GRU”, asserts that those he identifies who had initially either expressed support or remained neutral for the idea of constructing the biomass plant, are now left without credibility to speak on the issue. Further, he claims that some are engaging in “revisionist history”.
A revisiting of how the biomass plant came to pass, and the events surrounding them, only bolster the need to establish an Authority, separate and apart from a conflicted City Commission.
Those individuals who Eastman wags a finger at shared one failed trait during the time in question – that trait is “Trust”. They trusted people who weren’t worthy of that trust.
You see, even into the 2000’s people still trusted one another; believe it or not, that trust crossed party lines. When a college, university or think-tank published a study or an “expert” made a pronouncement, people were more likely to believe them. For the most part, they had to - information on the internet still wasn’t as readily available as it is today, particularly when it came to something as supposedly groundbreaking as biomass power generation. Conversely, people were more careful not to lose or take advantage of the trust that had been placed in them.
But that was changing; people began to freely exploit the trust of others for their own benefit. Some for ego, some for money, some for power. Today, the lack of faith many have in our institutions and the skepticism folks have can be directly traced back to that time when their trust was taken advantage of and they were the victim of a grift – the biomass plant was one such grift.
The launching of the Titanic that was biomass was held at the December 13, 2004 City Commission meeting. A group that included some, in Eastman’s vernacular, “loony liberals”, along with the GRU Assistant GM for Strategic Planning, presented the utility’s Long-Term Electrical Supply Plan. In it, was included “addressing the availability of waste wood from forestry resources, the range of alternatives considered for employing biomass.”
That may have been the end of it, even had the issue been presented and pushed at further meetings. However, the concept of biomass piqued the interest of then-Mayor Pegeen Hanrahan. Highly popular, and in some quarters revered, over the course of the next several years, Mayor Hanrahan would become the champion for biomass.
Holding a Master’s Degree in Environmental Engineering, she was viewed by most as brilliant, thorough and fair. With the climate change movement ramping up, she readily grabbed the mantel as the Florence Nightingale, ready to save us all from a fiery death. For those who didn’t go along with the dire predictions, Mayor Hanrahan assured them, there were benefits aplenty to be had for bringing a biomass facility online.
The lore of renewable energy production and strategies to combat the rising sea levels and melting glaciers were all the rage. As is the case with most “crises”, there was no shortage of “experts” selling solutions. In Gainesville, you assumed you were dealing with an “honest broker” and not a snake oil salesman if they’d been given the “Hanrahan Seal of Approval”. Anyone who heralded biomass as the answer was all but knighted by our mayor.
It wasn’t long before Mayor Hanrahan’s efforts earned her an even higher profile in environmental circles. She was the toast of such places as Edmonton and Copenhagen, where she would prophesize on how her leadership had moved Gainesville to the forefront of battle to save the planet.
Beyond biomass, she championed the City’s Solar Feed-In Tariff where GRU would makes a 20-year commitment to purchase up to 100% of the power that is generated by the solar photovoltaic systems of its customers.
Into 2007 and 08, a proposal to site a biomass plant in Gainesville was moving up the Commission’s agenda. While there was some pushback, because the economy was good, with the mortgage crisis still an unknown, guilt was a common tactic to ward off the naysayers. “People are dying and you don’t want to do your part?!”
However, in hindsight, it can be argued that the dizzying hysteria of the climate movement alone wouldn’t have gotten this initiative anywhere near the goal line. It was the trust that many had placed in Mayor Harahan and her unwavering commitment to bolting the canopy shut on this kamikaze mission.
On May 7, 2009, the City Commission voted to sign a Power Purchase Agreement with the owner/operators of the prospective biomass plant. The City would make an annual payment of $70 million for 30 years from the moment the facility was under construction in exchange for whatever energy it could generate – the money lost on the front-end, waiting for the site to begin producing energy, was promised to be made up tenfold on the back-end.
The project was on a glide path, and at every turn of the permitting process, proponents would lead off with an introduction of the one individual in whom they placed the most trust:
“What's very unique about Gainesville is we have for our mayor an environmental engineer. And Mayor Hanrahan has a foot in both camps, very firmly, between the practical and the scientific. And I can't imagine a situation in a community as environmentally aware as Gainesville is that the Commission would vote unanimously to approve this plant without having a thorough review of some little over two years.”
(https://content.app-sources.com/s/10713692903243992/uploads/Images/03740-2010-trn- 2710353.pdf)
As no one can deny, both “green energy” initiatives proved to be financially catastrophic failures – when all of the 20-year Solar Feed-In Tariff contracts eventually come to an end, it will have proven to have cost the City 10’s of millions of dollars in losses.
The biomass Power-Purchase-Agreement couldn’t have resulted in greater losses had we just sent the cash straight into the kiln.
In order to stop at least some of the hemorrhaging, a purchase of the biomass plant was negotiated – in return for not having to make the annual $70 million payments on the remaining years left under the PPA, GRU would pay $750 million to own and take control of the facility.
It was a costly lesson, and today the siren song of renewables and all its empty promises falls on the deaf ears of those who learned it; but not for the City Commission. Unphased by history, their goal of being net-zero by 2045 is the opening credits to a bad movie we have all been forced to sit through. It will only serve to continue the escalation in rates and quite possibly the bankruptcy of the City and its MOU.
(https://www.gainesville.com/story/news/2021/12/13/gainesville-energy-goals-gru-raise-debt-6- billion-dollars/6492107001/) (The Office of Speaker Pro Tempore Chuck Clemons)
Well that video just did me in, And here I thought Ward was all unique by talking about being available in the grocery store. How Pageen of you! I can see a serious crime unfolding, of course I am only speculating, but if the next audit digs deep enough I wonder how many will be held responsible for crimes?
14) But shouldn’t Gainesville lead the way to fight Climate Change?
In her opinion piece published in the Sun on December 19, 2009, entitled “After Copenhagen
Is there a city in the United States more ready to lead in this exciting time than Gainesville? Not from the view of the mayor's desk.” then-Mayor Hanrahan compares the pursuit of a carbon neutral world with President Kennedy’s “We choose to go to the moon!” speech.
In it she writes, “Our race to the moon, predicated on an ambitious commitment by President Kennedy, helped fuel America's undisputed dominance in science and engineering.”
No matter which side of the climate debate anyone falls, one thing is undeniable - following Kennedy’s speech, cities and towns didn’t begin building launch pads and rocket fuel storage facilities.
It is with great hubris, arrogance and vanity to enlist the captive customer base of GRU ratepayers and have them bear the heavy financial burden of being subjects in a learning lab experiment to beta test the next in the long line of “latest and greatest renewable.” Even for the sake of argument, after the costly trial and error, if the carbon footprints of the 100k plus GRU customers were reduced to zero, it wouldn’t make a difference of a difference.
As it stands, to achieve that threshold, GRU’s entire fleet of facilities would have to be mothballed because biomass has fallen so far out of favor with the green crowd –
https://www.politico.com/news/magazine/2021/03/26/biomass-carbon-climate-politics-477620
The proven odds are much greater that the only byproduct of this continued, misguided quest is further decimation of the City’s finances on the backs of GRU ratepayers.
Let the other states and locales be the guinea the pigs, GRU and its ratepayers have had enough.(The Office of Speaker Pro Tempore Chuck Clemons)
Can we please say that common sense was not used during the biomass crap! Common sense, would have been thinking about carbon emissions, and then thinking that burning trees would not be a good idea for carbon neutrality. Think about this, a forrest of trees burning, acres and acres burning. How much carbon at that point is created? Many are warned of the dangers of the air quality during these fires, at times you are also advised to where a mask, and sometimes you are evacuated. If a forrest fire is bad to breathe, now the upside to a forest fire is that the greenery comes back in that spot correcting the air quality. If you burn trees that have been shipped in the only thing you are doing is causing harm to the environment, not only through the pollutants from burning, but the horrible smell of rotting wood if not burned quick enough causing a nauseous gas (in my opinion). I am certainly not an environmental engineer, but working on common sense of things learned throughout school. So, we have a biomass, tree burning plant that either the city at the time thought burning trees was a neutral carbon thing, or they literally meant “Green” as in if I burn a tree then it is “Green” energy. Hmm…the moon sounds great Pageen!!
15) In the end, even if the State can legally establish a Utility Authority, right or wrong, because the voters of Gainesville select the Commission, shouldn’t Gainesville and GRU be left alone to rise or fall on their own accord?
Municipalities aren’t fiefdoms, nor do they exist in a vacuum. Again, they are political subdivisions of the State.
Should the City face insolvency, and/or should it be abolished in accordance with § 165.051, Fla. Stat. (2022), the provisions of Art. VIII, § 2(a) of the Florida Constitution dictates that creditors must be taken care of. That responsibility may very well fall at the feet and in the pocket books of every taxpayer in our state.
The City of Gainesville has been afforded an unparalleled opportunity to thrive by way of the State’s massive economic footprint. The University, Santa Fe, IFAS and the myriad of other state agencies inject an exponential amount of capital into the community compared to whatever property taxes the City laments that it forgoes.Nonetheless, it finds itself in the perilous financial position, noted above.
The passage of HB1645 is a result of the lack of confidence in the City Commission’s commitment to changing course and to their making decisions which are in the best interest of the viability of the utility and, in turn, the perpetuity of the City itself.
The Commission’s governance of GRU has them responsible for both sides of the ledger. Their conflict of interest has fueled this downward spiral and kept them from facing hard truths and realities. Now that the chickens have finally come home to roost, the Commission can’t make the claim that they are bailing out the water of their sinking ship with one hand, when everyone can see they are driving holes in the hull with the other. As such, the State is justified in taking the necessary measures to avert such a disaster.(The Office of Speaker Pro Tempore Chuck Clemons)
In my closing commentary to this, I must thank Speaker Pro Tempore Representative Chuck Clemons, Senator Jennifer Bradley, Representative Chuck Brannon and Senator Keith Perry, and you all’s offices for listening to those struggling. I thank you for really caring for your community, and taking the right steps in not allowing the Gainesville City Commission to continue to harm GRU and its customers. Through this whole process, that I have seen, I have learned much, I have become involved, and I have the utmost respect for you all. I hope one day to make an impact like you all have! I do know that the Bill may need tweaked in the future, and that is okay because it is a way to help the residents of Alachua County and Gainesville. Thank you all for Caring for your community.