WUFT News

GREC, Gainesville Can’t Reach Biomass Plant Purchase Agreement

By on October 31st, 2013

Negotiations between Gainesville and the Gainesville Renewable Energy Center to purchase a biomass plant have likely come to a close.

City commissioners proposed buying the biomass plant from GREC for $400 million, but GREC said the biomass plant is valued for hundreds of millions of dollars more than that offer.

Gainesville Regional Utilities suggested purchase prices from $520 million to $720 million, interest rates from 4.8 to 5.8 percent and potential savings to customers under each one of the scenarios, according to David Richardson, lead negotiator from GRU.

In a 4-3 vote, the city commission voted in favor of making an offer to buy the plant for $400 million on Oct. 17. The commission presented the offer to GREC on Oct. 21. GREC and the commission have 30 days to reach an offer for the city to buy the plant before GREC can look at offers from other companies.

Gainesville entered a 30-year, $3.1 billion power purchase agreement with GREC in 2009 to buy the power that will come from the biomass plant. Now, the negotiations are to buy the plant itself.

“Buying the plant would allow the city to remove any profit margin that a private entity, such as GREC, already builds into their rate,” said city commissioner Susan Bottcher. “That would pass along savings to our rate payers.”

Bottcher voted against the city buying the biomass plant. She said she was not surprised when GREC rejected the offer.

Bottcher would rather allow the people who designed and built the plant to ensure it’s functioning the way it’s supposed to before the city takes on that risk, she said.

Commissioner Todd Chase said he also voted against buying the biomass plant because of the uncertainty around it, such as the operational risk of the plant, the risk of the city’s ability to finance half a billion dollars or more and the risk around biomass as a fuel source.

“It does not appear that there is a viable agreement that can be made between the utility, the city, and the contractor GREC at the $400 million price,” said commissioner Randy Wells.

Thus, he said having more meetings would not be beneficial.

The announcement of GREC’s rejection of the offer will be presented to the commission at the Nov. 7 meeting.

The negotiation period will end on Nov. 20.

GREC has said that if a deal has not been reached after the 30-day period ends, it has other incentive options to bring to the city.

GREC did not return multiple phone calls to discuss this purchase.


This entry was posted in Environment and tagged , , , , . Bookmark the permalink.
 

More Stories in Environment

Gores Landing Wildlife Management area is a popular place for turkey hunters to visit during the turkey season in March. Photo courtesy of Greg Workman.

Flooding Disrupts Hunting During Spring Turkey Season At Gores Landing

From March 16-29, a large portion of McLemore Road on Gores Landing WMA is closed due to recent rainfall and flooding conditions. Unfortunately for hunters, the closure of the road in this typical turkey habitat overlaps with the spring turkey hunting season, from March 21-29.


A Florida Forest Service wild land firefighter conducts a prescribed burn to reduce wildfire risks in the Okeechobee district.

Intentional Fires Stimulate Environmental Growth In Alachua County

In efforts to promote a healthy forest ecosystem, burners at the Welaka State Forest and Etoniah Creek State Forest have been busy creating prescribed burns. The planned fires help to reduce potential fuel for unplanned forest fires and cycle nutrients back into the forest.


burmesefeaturedimage

Workshop Sparks Debate on Dangers of Burmese Pythons

Florida wildlife officials have boosted their efforts against Burmese pythons by inviting the public to join the fight, but some researchers and breeders disagree on the severity of the python problem.


Small lopsided fruit from greening-infected citrus tree. Photo courtesy of UF/IFAS.

New Funds Help UF/IFAS Fight Citrus Greening In Central Florida

University of Florida’s Institute of Food and Agricultural Sciences was awarded about $13.4 million to help fund four research projects aimed at finding a solution to citrus greening.


nonnativefishphoto1

FWC Hosts First Statewide Nonnative Fish Catch

The Florida Fish and Wildlife Conservation Commission hosts the first statewide nonnative fish catch. The contest was created to raise awareness and help reduce the growing population of invasive fish species in Florida’s waters.


Thank you for your support

WUFT depends on the support of our community — people like you — to help us continue to provide quality programming to North Central Florida.
Become a Sustainer
I want to support FM 89.1/NPR
I want to support Florida's 5/PBS
Donate a Vehicle
Underwriting Payments