Lakeland Utility Committee Approves Advisory Vote on Power Generation Replacement Plan
The City of Lakeland’s Utility Committee unanimously approved an advisory vote today on Lakeland Electric’s plan for replacement power generation. Lakeland Electric’s coal-fired generator will be mothballed by Fall 2024 and will leave 139 megawatts (MW) of generation capacity to be filled. The utility’s plan to replace the power generation capacity includes a combination of internal combustion engines, solar power, battery storage and power purchase agreements.
The plan calls for the purchase of five natural-gas fired internal combustion engines with approximately 100 MW total capacity. The internal combustion engines have extremely fast start times and ramp rates, making the units uniquely able to meet peak demand requirements and also manage capacity fluctuation typical of solar power. Lakeland Electric plans to add 50 – 75 MW of solar with 10% of battery storage. The new solar farm is likely to be located on land owned by the City of Lakeland. The solar panels will occupy the land for the next 25 years. The remaining capacity needs will be filled by demand management, interruptible load, and power purchase agreements. With this plan, Lakeland Electric is on track to reduce its carbon footprint by 67% since 2001 and will continue to provide affordable, dependable, and sustainable power to its customers.
To complete this plan, the utility will borrow $110 million through a variety of options, including bonds and bridge loans. An estimated 3.5% base rate increase is expected by 2023, less than the rate of inflation. The utility acknowledged during the meeting that changes in credit markets might cause modifications to the plan, and the Utility Committee will be advised throughout the process.
The utility will return to the Utility Committee for approval of purchase contracts, to issue debt, or for other necessary actions. Lakeland Electric believes this plan is the best long-term strategy to modernize the power generation portfolio and prepare the utility for a better operational, environmental, and financial future.