GRU Governance – 2017


 

 

BACKGROUND:

GRU is a publicly-owned utility company which supplies electricity, water and sewer to residences and commercial enterprises in Gainesville and Alachua County.  It is overseen by a manager who is appointed by the Gainesville City Commission. Profits from the utility remain here locally and are used to offset Gainesville property taxes and provide city services including fire and police protection.

In 2009, as the opposition to a new coal plant grew, the Gainesville City Commission looked at and approved an agreement with Gainesville Renewable Energy Center (GREC) to buy electricity generated from GREC’s as-yet unconstructed biomass power plant.  GRU was projecting that 1) biomass would be less carbon intensive than an additional coal or natural gas plant and therefore better for the environment; 2) natural gas prices were going to soon skyrocket as supplies were rapidly being depleted (this was before fracking was widespread); and 3) they would be able to sell excess power at high prices to surrounding counties as federal restrictions were put in place to control carbon emissions.

SSJ Sierra Club and others in community called into question all of these assumptions. However, misled by the GRU manager at the time, the Commission approved a very one-sided, anti-consumer contract with GREC. Later, natural gas prices plummeted as fracking provided huge new supplies, and federal restrictions on carbon emissions were not as immediate or strong as projected.

The result has been an overly large biomass plant which frequently remains idle but still requires large payments from the City, ultimately contributing to higher electric rates. Because fracking has generated abundant and cheap natural gas, the City has not yet been able to sell biomass-generated power to other utility companies. The community has continued to argue over this contract and it has caused divisions about where we go next.

WHAT HAS CHANGED:

  • The GRU manager who negotiated the GREC contract, mostly behind closed doors, has been replaced. The new manager is honest, works well with the Commission, and communicates with the public.
  • An independent investigative review of the negotiations, decision-making, and outcome of the GREC contract was commissioned (report can be found online via google search for GRU Navigant Report).
  • A Utility Advisory Board (UAB), formed with citizen input and made up of community professionals with expertise in energy, economics, engineering, law and business, has been established as recommended by both the local Chamber of Commerce and the Navigant Report. While not all of the UAB recommendations to the Commission have been adopted, the two bodies continue to have a good relationship and a workshop will soon be held to discuss UAB-requested changes to their structure and authorizing powers.

This is not to say that we agree with everything that the GRU manager or the City has proposed in relation to GRU. Rather, we believe that under the current structure, citizens have the ability to review and have input to decisions.

CURRENT CONCERN:

Despite unambiguous opposition from GRU, the city commission, the county commission and Rep. Clovis Watson, our State representatives, Senator Keith Perry and Representative Chuck Clemons, succeeded in passing a bill during this past legislative session that will put a referendum on the City of Gainesville election ballot in November 2018. This referendum, if passed by the citizens of Gainesville, will dictate strict terms of a completely independent governing board for our locally owned utility.  GRU would operate like a private corporation, at taxpayers’ expense, completely and legally insulated from any and all public control or interference. Nowhere in the bill does it mandate lower rates or how to deal with GREC.

WHY SHOULD SIERRA CLUB BE INVOLVED?

            As a publicly-owned utility, GRU answers to the City Commission and its citizens. Residents of the City and Alachua County have consistently supported sustainability measures: recycling, water conservation, energy conservation and solar power.  Over the long-term, GRU has responded to all of these issues, often being first in the State or even the Country to implement innovative programs designed to reduce water and energy use and promote the use of solar energy. These programs, while sometimes increasing rates in the short term, have led to lower bills for many residents who have been able to reduce their power and/or water use. Of course, there is much more we need to do to lower utility bills, especially for lower-income households.

But any future environmental initiatives could disappear under an independent governing board. Instead, the drive would be to lower rates, especially for large commercial interests so that the development community can entice corporations and large developers to our area. We believe the end goal is privatization of our utility and appropriation of its profits – the Perry/Clemons bill will pave the way for a corporate take-over of our public asset. Property taxes would need to go up or community services would need to go down.

WHAT TO DO:

Write a column for The Gainesville Sun (500 word max) or at least a letter to the editor (150 word max).  You can see Susan Bottcher’s excellent letter here.  The link to The Sun’s online submission page is here.