Paul Ciampoli
Welcome to the latest episode of Public Power Now.
I'm Paul Ciampoli, APPA’s News Director.
Our guest on this episode is Gage Huston, General Manager for Iowa public power utility Muscatine Power and Water.
Gage, thanks for joining us.
Gage Huston
Thank you so much for having me, Paul. I'm actually a huge fan of the podcast, so I'm honored to have the chance to join you.
Paul Ciampoli
I appreciate that Gage, very much.
So Gage, to get our conversation started, can you provide our listeners an overview of the utility and also your role and responsibilities as general manager.
Gage Huston
MPW serves the city of Muscatine, Iowa, and its surrounding areas.
Muscatine is located along the Mississippi River, right in the heart of the Midwest, and MPW provides electric water and fiber communication services to the community. On the electric side, we're actually vertically integrated. We provide power generation, transmission and distribution services to our customers.
Having our own power generation has actually been a cornerstone of our utility since we first started serving customers back in 1924.
We serve an annual load of about 145 megawatts and that's pretty substantial for a community of our size. A lot of that comes from industrial load. We actually have an annual load factor of about 73%, which means that our load demand stays high even on nights and weekends all year long, and having cost control and decision making capability over the entire chain from power generation all the way to distribution, that's been critical to keeping rates low and our reliability high for Muscatine over the past 100 years.
As far as my role as GM, I have the privilege of supporting our 275 employees and my role focuses largely on bigger picture items.
Setting the strategic direction for the utility, establishing and maintaining the culture that we want to have throughout our organization. I also serve as a key advocate for MPW in the community.
I think it's important for a general manager to establish relationships with key stakeholders in the community and stay in touch with the needs of those stakeholders throughout the year.
It's also important to be involved in community planning activities like economic development, so that we can work together to find ways to grow and improve our community, and then last and certainly not least is my role as the primary conduit of information with our board of trustees.
And we've been really blessed throughout our history with talented and dedicated Board members and my role is to ensure that they stay informed about key initiatives in the utility and also to ensure that we integrate their strategic insight and direction into our utility’s plans and my role is also to maintain their confidence in our staff -- that we're taking care of things and that we're serving our customers in a way that meets our board members’ expectations.
Paul Ciampoli
In terms of preparing for this interview, one of the things that jumped out of me is the utility’s Powering the Future initiative.
With respect to that initiative, can you provide additional details on it? And more specifically, could you detail the projects the utility’s pursuing as part of the initiative?
Gage Huston
We developed the Powering the Future initiative about five years ago and that was in recognition of our rapidly changing landscape and the electric utility industry that we're all facing. And we recognized the importance of thinking strategically through the transitions that we had ahead of us.
And so as part of that, we established four criteria to help guide our decisions about how we provide power to Muscatine in the years to come.
And it's all about balancing these four factors for us -- it's reliability, affordability, flexibility and sustainability.
And our belief is that you have to maintain a balance of those four factors. If any one factor gets too heavily weighted, it can....have negative consequences to our customers and the other three areas.
That said, though, I will say that reliability still maintains top billing on that list.
And the one that I think is going to come under additional pressure in the next 5 to 10 years as we see the electric system continue to evolve.
And with our Powering the Future initiative, we identified several goals that we're working through.
We're expanding our renewable portfolio. We're currently in development of a 24 MW local solar farm and also investigating additional solar generation opportunities, but that first solar project is a unique one.
We're actually planning to site it on land that we already own...It's also land that has a low agricultural value, so we're not taking prime farmland out of service, which is a topic that actually is becoming a bigger and bigger issue here in the Midwest.
We're also investigating options to replace some of our other local generation resources. We have some local generation assets that are over 65 years old.
As we plan for retirement of those resources, we need to determine what's the right mix of new resources to serve our community.
One key piece of that right now is to develop a new combined heat and power resource. This is another really unique project for a utility of our size.
This unit will actually produce about 35 megawatts of electricity and utilize heat from that process to produce processed steam for a large industrial customer. CHP units are really great because they squeeze absolutely the most you can out of every unit of fuel.
We're also planning to leverage direct pay tax credits, something that APPA staff fought very hard for with the Inflation Reduction Act. And those credits are expected to save our customers about $8 [million] to $12 million on this project. So that was a huge win for APPA and for public power members throughout the country.
Also through our Powering the Future effort, we've set some pretty aggressive carbon emission reduction goals.
We set a goal of a 25% reduction by 2024, which we've successfully achieved and a 65% reduction by 2030, which we're on track to do. So that's a 65% reduction in emissions all while maintaining the same reliable service to our customers and the last very important goal for this initiative is to transition reliably and safely. Our existing generation assets remain critical to Muscatine and this transition is going to take place over many years.
We have a tremendously talented and dedicated staff of employees who work at our power generation facility and they know the importance of keeping those existing assets and the new assets when they come along running reliably for our community.
Paul Ciampoli
With respect to the combined heat and power resource facility, any timeline on when that might be completed?
Gage Huston
Yeah, we have to start physical work on that unit before the end of this year to qualify for those tax credits. So that will happen actually very soon. We just got board full approval to move forward with that project and then we have a four year window to complete the project. So it must go online by the end of 2028.
Right now, working with our engineering firm, we're targeting somewhere around the middle of 2028 to go commercial.
Paul Ciampoli
I wanted to switch topics a little and talk about one of the things that impressed me as I researched for this interview.
Muscatine Power and Water has received recognition from APPA through various awards, certifications and designations.
In 2023, the utility received its fourth consecutive Diamond-level Reliable Public Power Provider designation, fifth consecutive Excellence in Reliability certification, and its third Smart Energy Provider designation.
And at APPA’s National Conference this year, the utility was one of four utilities to receive the E.F. Scattergood System Achievement Award, which honors APPA member systems that have enhanced the prestige of public power utilities through sustained achievement and customer service.
What are the steps the utility has taken to earn this recognition from APPA?
Gage Huston
I was very humbled to accept that E.F. Scattergood award in San Diego last month.
The full credit of that award goes to our incredible staff here at MPW, and I was just a guy that got to stand up on the stage and hold the plaque for the photo.
But one of the many things that I think APPA is great at is developing programs to help share best practices throughout the public power community.
Public power employees are amazing and we have a unique culture in that we're all rooting for each other to be successful and we're happy, even anxious to share those best practices with each other and APPA's programs like RP3, the Smart Energy Provider, excellence in reliability, safety, et cetera. They've helped make our utility better by striving to achieve the standards that are set forth in those programs.
As far as how we got there to achieving those awards, I think it's primarily about establishing the right culture. At MPW, we take a lot of pride in our work and we strive to achieve a standard of excellence in all that we do.
And these APPA programs are a great way to measure our efforts in achieving that excellence. So from there, once you build the culture, it's a matter of assigning great people the ownership of our participation in those programs, folks like our Chief Operations Engineer Mark Nelson, who has owned and led our RP3 application efforts for the past several cycles and does a fantastic job.
And folks like Paul Burback, Jim Garrison, Mitch Zytnowksi that lead our efforts in achieving awards in the other programs.
I think it really comes down to that. It's establishing that culture of excellence and then leveraging the programs that APPA puts together and then having some really talented people to kind of take it from there.
Paul Ciampoli
I wanted to wrap up our conversation and talk about the importance of public power utilities connecting with their communities.
And more specifically I wanted to talk to you about the ways in which the utility engages and communicates with its customers about the value of public power and how Muscatine Power and Water is providing customers with high levels of service and reliability.
Gage Huston
We're really blessed at MPW to have an extremely talented marketing and PR team. We've received recognition from APPA through the Excellence in Communications award several times over the past three years, also. We’ve utilized several channels to tell the positive story of MPW and public power in general.
One of the most impactful is through video. We've run a series of employee spotlights themed IMMPW to highlight our employees and that they're really neighbors serving neighbors.
I think it's important that our customers know that the folks working to provide their utility services are their friends, their family neighbors, their neighbors down the street.
I think that local connection really matters when it comes to providing service and we wanted to highlight that through that video series.
Another very impactful medium for us is through our community and one-on-one presentations.
We do an annual power breakfast event where we invite community stakeholders in for a nice breakfast and we present highlights from the previous year throughout the utility as well as an outlook for some of the bigger projects and initiatives that we have planned for the coming year.
And when we do those events, I open each and every session by reminding our guests of the benefits of the municipal utility model and reintroducing our local board of trustees to the group.
We also have a template presentation that we refer to as your utility in your community, which provides an overview of MPW and highlights the critical role that we play in the Muscatine community.
We give that presentation to elected officials, business leaders, community development groups, nonprofits – basically, any audience that has an interest and may benefit from better understanding how our utility works and those presentations have been very successful in sharing that message.
And last, we just recently completed a customer survey and one of the surprises we found from that survey was that the strong majority of our customers still utilize our utility newsletter that we include with our bills to get information so those newsletters have evolved over the years to be more visual with more pictures, more infographics and less text.
And then based on the survey feedback we just received, we're planning to reinforce our efforts to further leverage that newsletter medium to get our key messages to customers, including the benefits of public power, so we're excited about that.
Paul Ciampoli
One thought occurred to me in terms of a possible follow up question for you.
I would imagine with the Powering the Future initiative, you guys have been proactive in terms of keeping your customers and the community involved and saying OK, this is where things stand. This is the reason why we're pursuing it, things like that.
Gage Huston
Yeah, absolutely. Of course, we have open public board meetings every month and we provide an update every month on that Powering the Future initiative. But we've also done community presentations -- we've done community forums, we did an open house where we provided an update on Powering the Future stuff, but also did a tour of some of our facilities, including the site for the new solar project.
So it's been important for us to make sure that our customers were educated and we were transparent about the decisions we're making, where we're headed with Powering the Future and the why behind all of that.
Paul Ciampoli
Thanks again for taking the time to speak with us today.
Definitely a lot of topics that we could take another look at if you'd like to come back to our podcast.
We'd love to have you back and I'm sure starting with the Powering the Future initiative that would be probably a good place to pick up from this conversation in terms of things we could talk about.
Gage Huston
Yeah, absolutely. I love talking about this stuff and we've got some just really big things going on throughout the utility, some stuff that we haven't done in 40-50 years at MPW. So it's an exciting time to be at MPW. It's an exciting time to be in the electric utility industry. And so I'd love to come back and talk about it anytime.
Paul Ciampoli
Thanks for listening to this episode of Public Power Now, which is produced by Julio Guerrero, Graphic and Digital Designer at APPA.
I'm Paul Ciampoli and we'll be back next week with more from the world of public power.
