Monday, May 12, 2021 at 5:00 p.m.
A Special Called Meeting of the City of Henderson, Kentucky, Utility Commission will be held on Monday, May 12, 2021, at 5:00 p.m., local time. The purpose of the meeting will be for a presentation and discussion of the Integrated Resource Plan (IRP) for HMP&L by GDS Associates. This meeting will be conducted as a video teleconference meeting as allowed under KRS 61.826. Any interruption in the video or audio broadcast at any location shall result in the suspension of the meeting until the broadcast is restored. As a result of the state of emergency declared by the President of the United States and the Governor of Kentucky due to the global COVID-19 pandemic, and in accordance with recommended and mandated precautions related to COVID-19 and Kentucky Attorney General Opinion 20-05, the following Meeting Notice is issued: the special called meeting of the City of Henderson, Kentucky Utility Commission will be held on Monday May 12, 2021, at 5:00 p.m. CDT by means of a video teleconference meeting. One or more members of the Utility Commission may participate via Zoom Webinar or similar video teleconferencing system and the meeting will be available to the public. No primary location will be set for public attendance as per Kentucky Attorney General Opinion 20-05, public attendance will not be permitted at this meeting due to the highly contagious nature of COVID-19, it is not feasible for HMP&L to maintain order and abide by recommended and mandated precautions while providing a central physical location for public viewing. The meeting information is as follows: Zoom Webinar ID: 937 6568 9823, Password: 511836, Dial: +1 312 626 6799. Members of the public wishing to address the Utility Commission may email comments or questions before or during the meeting to email@example.com.
This meeting will be conducted as a video teleconference meeting as allowed under KRS 61.826. Any interruption in the video or audio broadcast at any location shall result in the suspension of the meeting until the broadcast is restored. As a result of the state of emergency declared by the President of the United States and the Governor of Kentucky due to the global COVID-19 pandemic, and in accordance with recommended and mandated precautions related to COVID-19 and Kentucky Attorney General Opinion 20-05, the following Meeting Notice is issued: the regularly scheduled meeting of the City of Henderson, Kentucky Utility Commission will be held on Monday, April 19, 2021, at 5:00 p.m. CDT by means of a video teleconference meeting. One or more members of the Utility Commission may participate via Zoom Webinar or similar video teleconferencing system and the meeting will be available to the public. No primary location will be set for public attendance as per Kentucky Attorney General Opinion 20-05, public attendance will not be permitted at this meeting due to the highly contagious nature of COVID-19, it is not feasible for HMP&L to maintain order and abide by recommended and mandated precautions while providing a central physical location for public viewing. The meeting information is as follows: Zoom Meeting ID: 921 5902 6059, Password: 730055, Dial: +1 312 626 6799. Members of the public wishing to address the Utility Commission may email comments or questions before or during the meeting to firstname.lastname@example.org.
During a joint meeting Tuesday of the City of Henderson Board of Commissioners and the Utility Commission, local leaders agreed to pursue hiring a national firm to determine the value of Henderson Municipal Power & Light (HMP&L), a taxpayer-owned utility that has served the community for more than a century.
The decision followed a presentation during the joint meeting by Big Rivers Electric Corp. CEO Bob Berry, during which Berry outlined a proposal to purchase HMP&L from the City of Henderson. It was the second proposal offered by Big Rivers in the past year. The previous proposal included a provision to maintain Big Rivers’ headquarters operations in Henderson, but that offer was dismissed after Big Rivers announced it will relocate its headquarters to Owensboro.
The latest proposal from Big Rivers includes an offer to maintain Big Rivers’ transmission operation in Henderson with about 30 jobs. Berry told the commissions during the joint meeting that those operations also will be moved if Henderson does not sell HMP&L to Big Rivers. Berry also told the board Big Rivers would be willing to discuss maintaining its headquarters in Henderson as part of a sale. He did not provide specifics or say how that would affect the company’s plans to expand in Owensboro.
The decision to hire a valuation firm does not indicate that a sale is pending or that Henderson is negotiating a sale of its utility assets.
“This is third time overall and the second time in the past year that Big Rivers has approached us with an unsolicited offer to buy Power & Light,” said Henderson Mayor Steve Austin. “We were prepared to take this step to evaluate our options last year, when Big Rivers announced it was moving to Owensboro. As stewards of the community’s assets, we felt it was our obligation to review this offer to determine if a sale would be in Henderson’s best interests.”
Latest Big Rivers proposal
In a letter sent last month to the City of Henderson by Berry, Big Rivers renewed its offer to buy HMP&L and assume its operations.
The highlights of the proposal included:
Under the proposal, the City would retain current pension and bond liabilities and would turn over local control of HMP&L to Big Rivers.
HMP&L Review: Henderson would lose $173.7 million on deal
HMP&L general manager Chris Heimgartner was also asked to give a presentation during the joint meeting, and Heimgartner shared highlights from a preliminary evaluation of the offer by HMP&L staff.
The HMP&L evaluation found that overall, the City and HMPL customers would not benefit from the Big Rivers proposal. The proposed deal would result in a cost of $173.7 million, or nearly $7 million per year over the next 25 years. It also would transfer decision-making control from locally elected and appointed commissions to Big Rivers. The decision also could not likely be reversed, Heimgartner said.
Conversely, the proposed deal would likely provide significant benefits to Big Rivers. The HMP&L analysis found that the proposed deal (including the purchase price and franchise fees) would result in a net gain for Big Rivers of $157.6 million, or $6.3 million per year.
“HMP&L is a tremendous asset owned by the taxpayers of Henderson,” Austin said. “We have not decided whether it would be smart to sell it or whether legally the City would be required to ask for other purchase proposals. However, we must look closely at this proposal and consider not just the financial implications but also the long-term implications on utility rates, community benefits and economic development.”
On March 23, 2021, General Manager, Chris Heimgartner, made a presentation before a joint meeting of the City of Henderson, Kentucky Board of Commissions and the Utility Commission regarding Big Rivers Electric’s offer to purchase HMP&L. Below are the slides from that presentation.
Dear Valued Customers,
This has been a challenging year on many fronts for our nation, our state, our community and most importantly you, our citizens and business leaders. As many of you may have read or heard recently, it also has been a challenging year for our municipal utility.
A recent newspaper article shared some details about our discussions with Big Rivers Electric Corp. and a surprise proposal Big Rivers made to potentially purchase our city-owned utility. As leaders of your community owned power company, we felt it was important to tell our customers more about that proposal and why it ultimately failed.
At HMP&L our top priority is to serve as trusted stewards of one of Henderson’s most valuable assets, maintain rates that are the lowest in the region and benefit all businesses and customers we serve, and to manage the utility for the long-term good of the City of Henderson. We have worked hard to do that over the last 125 years.
In relation to Big Rivers’ proposal letter, we feel it is important for our customers to know a few important facts.
1. Big Rivers DID NOT make a formal offer to buy Henderson Municipal Power & Light and keep its headquarters in Henderson. Instead, they offered to begin negotiations. Our history with Big Rivers, especially recently, has highlighted how difficult it can be to negotiate fair and equitable agreements or reach agreement on formal mediation.
2. Our local leaders took the offer seriously and were hiring an internationally known firm to provide an independent value for the utility to see if the offer to negotiate from Big Rivers was fair or reasonable. Our City Commission and Utility Commission had several discussions and were still gathering information when Big Rivers made its surprise announcement on Thanksgiving Eve that its headquarters will move to Owensboro.
3. Henderson Municipal Power & Light is much more valuable to our City than the amount Big Rivers initially proposed to pay. Nevertheless, we didn’t want to tell them “no” without fully considering the proposal and determining if the City should enter an expensive and time consuming negotiation with Big Rivers.
4. We DO NOT believe Big Rivers intended to keep a substantial operation in Henderson if it purchased HMP&L. According to Owensboro officials, they had negotiated with Big Rivers for two to three years to move the headquarters. Owensboro also offered financial incentives to Big Rivers. That negotiation process started after Big Rivers offered to buy Owensboro’s municipal utility and was turned down. The proposal letter Big Rivers sent to Henderson speaks of keeping a headquarters in Henderson but makes no guarantee of keeping the headquarters at its current location or of retaining a specific number of jobs in our City for the future.
5. Finally, Big Rivers’ proposal is among several initiatives and discussions we have been involved in this year attempting to settle disputes. We willingly participated in negotiations with members of our business community, and have offered significant concessions attempting both to reasonably resolve the differences and to keep the headquarters of Big Rivers in the City of Henderson.
There remain many short- and long-term issues in dispute between Big Rivers and Henderson Municipal Power & Light. Most are financial issues, brought about by the closing of Henderson’s Station Two Page 2 of 2 power plant that had been operated by Big Rivers. Many of the issues have to do with demolition of the power plant, future environmental plans, and a payment of millions of dollars owed to HMP&L by Big Rivers under our contracts. We have filed suit against Big Rivers to force them to honor our past agreements, and that is another reason to be cautious in entering a new contract with them.
We remain committed to defending Henderson taxpayers and HMP&L customers from paying more than their fair share of the costs related to our former partnership with Big Rivers.
So, what happens next?
Big Rivers has been studying a move to Owensboro for a long time. At least two years ago, they began negotiations to move to Owensboro. Big Rivers will eventually move to Owensboro, and we will work very hard to fill the hole that the move leaves in our community. We deeply regret Big Rivers’ decision to leave Henderson. Some Big Rivers employees live here and have been active in community service. We hope they will stay and remain committed to making Henderson a great place to be.
Some important points about Henderson Municipal Power and Light to remember:
1. As a public utility, HMP&L will continue to serve its customers with the lowest possible rates and the best possible service. We have locked in low cost power for the next few years and are actively planning a power mix that is right for Henderson’s future. Our rates are 20% to 40% below our surrounding utilities, and these low rates are an annual savings of over $12 million to our customers.
2. Our reliability, while not perfect, is truly outstanding and reflects our peoples’ efforts, sometimes in the worst possible conditions.
3. We’ve replaced our old streetlights with a modern LED system. At the same time, we’ve begun to renovate some of the alley lighting systems in the City.
4. We’ve begun undergrounding some of our downtown system for higher reliability and a more attractive downtown.
5. We provide significant support to local organizations, including the Chamber of Commerce and Economic Development.
6. We have established a low-income relief fund that helps our struggling customers meet their utility bills.
7. Lastly, we are locally owned and controlled and will always work in the best long-term interests of our customers and the City of Henderson. That’s what we’ve done for over a hundred years, and that’s what we will continue to do.
The differences between HMP&L and Big Rivers will be resolved by the courts with independent and unbiased judges making those decisions. At some point the judgements will be made, the appeals exhausted, and through it all the lights will be burning bright for Henderson residents and businesses.
Steve Austin, Mayor
Lin Shannon, Utility Commission Chair
Mark Weaver, Utility Commission Vice Chair
Jennifer Howell, Utility Commission Secretary
David Curlin, Utility Commissioner
Russell Sights, Utility Commissioner
Chris Heimgartner, Utility General Manager
In July 2020, Community Energy and Henderson Municipal Power & Light (HMP&L) announced an agreement for the supply of 50 megawatts of new solar power to HMP&L customers.
Through a 20-year Power Purchase Agreement, HMP&L will purchase 100% of the output of a new solar farm under development by Community Energy in Henderson County, Kentucky. This facility is expected to produce 117 million kilowatt-hours of low-cost solar energy per year, starting in 2023. The solar project will provide approximately 20% of HMP&L’s total electricity demand.
For more information see Community Energy's Project Site:
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