Radford Council Considers Energy Purchases
By David Quesenberry
Patriot Publishing
At its regular meeting on November 12th, the Radford City Council approved measures to address the City’s future energy supply and promote new housing development.
Under consideration by City Council was a resolution approving master power purchase and sale agreements for the City’s power supply. Mayor David Horton said that the City had a nearly twenty year contract with Appalachian Power Company for wholesale power purchases which would end May 31, 2026. Given the complex nature of these agreements, he said that for the last couple of years the City had been working with the Blue Ridge Power Agency on determining what a new contract would look like; what options were available; and in general what would be best for the community.
Mr. Tim Logwood, Director of Electrical Utilities for the City, spoke to Council about how Radford’s future power purchases would operate. Logwood said the resolution would approve master power purchase and sale agreements for the City from June 1, 2026 to December 31, 2028. A request for proposals (RFP) was issued in August 2023 with the assistance of the Blue Ridge Power Agency for market based power. The current agreement with APCO was on a cost based power basis which prevented the City from adding to its generating resources. Market based power would assist in the development of a “portfolio for power procurement” which would allow the City to enter into long and short-term power purchase agreements. These agreements could be mixed together to limit the City’s exposure to one general power supply. Power could be sought from multiple companies as well as from renewable energy sources.
Logwood said that under market based power purchase there were two options, Load Following (LF) and Fixed Load Shape (FLS). While both options had advantages and disadvantages, the best outcome for the City would be the FLS. Advantages of this option were: portfolio diversity; high supplier competition; lower cost premium; rate stabilization; flexibility to incorporate future resources; and minimal market exposure risk. Disadvantages were: a portion of the power load is vulnerable to the market; scheduling services for energy requires a separate contract with each provider; and pass through costs would be incurred for capacity and transmission items.
Both options could include provisions for using solar energy from a proposed 2028 renewable solar energy project. Using this energy would allow the City to reduce its energy purchases when that project becomes operational.
The resolution would also set not-to-exceed price guidelines on each wholesale power option proposed. For a load following product (LF) the limit would be $60.49 per megawatt/hour and $55.66 per megawatt/hour for the fixed load shape product.
Logwood said attorneys for the City and Blue Ridge Power Agency had worked with several recommended competitive energy suppliers which were: American Electric Power Services, Nextera Energy, Tidal Energy Marketing, CMS Energy and Shell Energy. The City Attorney had negotiated market based agreements with these providers and had reviewed and accepted the terms of the five agreements.
Overall the resolution would: approve the purchase and sale agreements with the five energy providers; include the provisions for a not-to-exceed price for each option; specify that product recommendations would be based on price; provide for downward adjustment of power purchases if the City participates in a solar power purchase agreement; and confirms that the agreement for either option was intended to meet the all of the City’s energy requirements.
Following the presentation and the reading of the resolution into the record by Mayor Horton, Council unanimously approved the measure.
In another energy related matter, Council postponed to the December 9th meeting a resolution approving an energy storage service agreement with Delorean Power, LLC, dba Lightshift Energy. The agreement provides for a battery energy storage system (BESS) for the City that would provide up to 8 megawatts of energy storage. The system would be used to reduce peak power supply costs to the City.
Council also conducted a public hearing on a request from Shentel for a ground lease for a 20 foot by 20 foot portion of City property at 420 Prospect Street. The property would be used to house four cabinets of digital equipment with support facilities as part of Shentel’s effort to upgrade fiber optic service to the City. With no comments received, Council voted unanimously to approve Ordinance 1809 approving the lease of the site to Shentel.
Concerning future development, Council approved the sale of approximately 21 acres in the Prospect Hill area to Golden Triangle Development, LLC. for $99,650. The site is intended for the construction of a housing development of approximately 50 patio homes and two story homes between 1,300 and 2,100 square feet in size. City Manager David Ridpath told Council that the sale of the property was the first hurdle and that it would have to go to the Planning Commission for subdivision of the property and home owner’s approval. He estimated it would be four to six months before the subdivision of the property would be brought back for Council’s consideration.
Council learned from FEMA Representative Brian Smith that FEMA would be setting up a Disaster Survivor Assistance Site over the next two days at the Radford Recreation Center from 8:00 am to 6:00 p.m. FEMA representatives would be available to talk to members of the community about flood assistance and the status of their claims from Hurricane Helene.
The next regularly scheduled meeting of the Radford City Council will be at 7:00 pm on Monday, December 9, 2024 in the Council Chambers of the Radford City Hall, 10 Robertson Street.