Ames is spending roughly $76 million to secure more “efficient” electric generators at its new, yet-to-be-built power plant.
The city plans to construct the Ames Municipal Energy Center in the current Ames Power Plant coal yard, which likely will open in 2029.
The city will use only natural gas at the new $192 million facility, replacing the waste-to-energy method used at the current Resource Recovery Center. Ames is also building an $18 million solid waste disposal and recycling facility in 2027.
Ames’ power plant at 305 East 3rd Street has been burning refuse-derived fuel since 1975, serving more than 28,000 customers and providing 138 MW of energy in a year.
The new power plant will be anchored by a trio of Reciprocating Internal Combustion Engines (RICE) to meet Ames’ growing energy needs.
On July 28, the Ames City Council awarded a $70.1 million contract to Wartsila North America Inc. to install the generators. Taxes and tariffs will add an additional $6.6 million.
The generators will be delivered to the City of Ames on a foundation in October 2029.
The council also agreed to purchase a $2.3 million transformer from Cahoon Sales Inc. in Iowa City, which will be delivered in 33 months.
The engines and the transformer represent roughly 41% of the $192 million project.
Council approves $1 million surety bond for new generators
City staff asked Wartsila to provide a surety bond, guaranteeing to deliver what was promised.
Wartsila initially provided a $1.5 million bond, but after several days of negotiation, it was lowered to just over $1 million.
The bond covers 100% of the contract until the operation date, Ames Assistant Electric Director Curtis Spence said. The warranty will cover up to 10% of the contract for the ensuing two years.
Ames wants more efficient electricity generators
Ames has only two natural gas-firing generators in operation, built in 1967 and 1982, both of which have exceeded their typical 30-year life span.
The oldest, Unit 7, provides about 33 megawatts of energy for the city, while Unit 8 produces 65 megawatts.
The city also owns and operates two combustion turbine peaking units, one mile east of the current plant. They generate an additional 45 MW of energy.
Though the new generators also use natural gas, RICE units burn less fuel while generating the same amount of energy, helping the city reduce its carbon footprint.
The new generators are expected to produce 108 megawatts of energy compared to 98 megawatts produced by the two current generators.
How will Ames fund its new power plant?
Ames will establish a bond for the new power plant, Ames Electric Services Director Don Kom said during a July council meeting.
Because the city will no longer be burning refuse-derived fuel starting in 2027, those funds can be used to pay off the bond, he said.
The city is also considering a 2.5% annual utility rate increase for the next 18 years, through Fiscal Year 2043-44, followed by a 1.5% annual rate increase through Fiscal Year 2056-57.
Celia Brocker is a government, crime, political and education reporter for the Ames Tribune. She can be reached at CBrocker@gannett.com
This article originally appeared on Ames Tribune: Ames approves $76M generator purchase for new power plant
Reporting by Celia Brocker, Ames Tribune / Ames Tribune
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By Celia Brocker, Ames Tribune | USA TODAY Network
