COVINGTON - The city of Covington has finalized an agreement with the city of Marietta to acquire additional power.
"Covington is short on baseload power supply. Marietta has an excess. We're acquiring a portion of that excess," Utilities Director Bill Meecham said.
The city will purchase three megawatts in 2010 and five megawatts per year from 2011 through 2015. The cost over the six year period will be approximately $9.8 million.
"In return, we intend to pay all operating costs associated with it and pay them a mark up above that to cover their investment," Meecham said.
The additional power doesn't necessarily mean rates will decrease, but it will help keep them more stable, Meecham said.
"Our goal is to try to avoid unexpected or large increases that can occur when buying a lot of power off the day-to-day market," he said, noting the city purchases about 30 percent of its power supply off the market.
The City Council approved an agreement between Covington, the Municipal Electric Authority of Georgia (MEAG) and the city of Marietta at its Monday night meeting. MEAG will sell the power on behalf of Marietta.
The city purchases power through MEAG, but with customer growth out-pacing supply, it has been forced to turn to the market to buy additional power. Market rates can be volatile, resulting in substantial swings in customer bills.
To address that, the city will also purchase additional baseload power from 2010 until 2015 from the MEAG and its trading affiliate The Energy Authority.
The city is also investing more than $100 million in the two-phase Plant Vogtle expansion to secure future power. Two additional nuclear reactors at Plant Vogtle are expected to come online in 2017.
Crystal Tatum can be reached at firstname.lastname@example.org.