The following is a transcript of the May 5, 2025, episode of Public Power Now. Learn more about subscribing to Public Power Now at Publicpower.org/Podcasts. Some quotes may have been edited for clarity.
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 Dwayne Fulk, President and CEO at City Utilities of Springfield, Mo.
In August 2024, the public power utility announced the selection of Dwayne as its new president and CEO.
Dwayne, thanks for joining us.
Dwayne Fulk
Thank you.
Paul Ciampoli
So Dwayne, just to get our conversation started, in preparing for this interview, I noticed the fact that prior to your current position as President and CEO, you have a number of other positions at the utility. Can you offer additional details on your career if the utility leading up to your current role?
Dwayne Fulk
I was hired about 7 1/2 years ago at the end of 2017 to be the associate general manager, General counsel for City Utilities.
At that time, I had responsibility over legal, government relations, environmental affairs and records governance, and so in that role and through different title changes and responsibility changes, I eventually also had responsibility for internal auditing, electric reliability compliance, and then starting last year, economic development and developer services as well, so I got to see most of the things that were going on within the utility and to be involved in the risk analysis, risk management and decision making process to be able to give input and then also to be able to carry out the decisions.
So it was a great training ground for any number of issues that might come up on a daily basis in this role and I was thankful to have that.
I was hired in this role at the end of last year as you mentioned and I like to say that I'm in the same meetings, but in a different chair -- certainly a much hotter chair, a lot more responsibility, but at least I'm familiar with what we're talking about.
Paul Ciampoli
We're over 200 episodes now in terms of the podcast and a consistent theme that's emerged in terms of my interviews with executives who have taken on management roles is that with respect to public power utilities, obviously, a lot of the people I speak with have that long, deep experience with their respective utility. So I'd imagine that sets you up pretty well in terms of success.
Dwayne Fulk
Absolutely, it did. Not just the knowledge that I've gained, but also the relationships with the employees and doing a deep dive into the different legal issues that we were involved in.
I also was able to serve as our Member representative on the Southwest Power Pool members committee. So a lot of experience within the industry, but in my case, maybe it's a relatively short amount of time -- 7 1/2 years is less than our average tenure of employee at City Utilities, but I did have that outside experience as a private attorney, which I think added to the flavor of my perspective and then also some appreciation of what we have here as a municipal utility.
Paul Ciampoli
I wanted to switch gears a little bit and talk about specifically rates and in preparing for the for the interview…something that jumped out at me was the fact that CU’s electric customers paid 28% less than the national average and 11% below the state average.
And on the natural gas side, customers save even more with rates 35% below the national average and 52% below the state average. What are the strategies the utility has adopted to maintain such low rates for its customers?
Dwayne Fulk
I am blessed to be able to stand on the shoulders of those that came before me who have a long history of those low rates and of great management of our utility.
And I would say what it comes down to is simply prudent investment and we invest in our personnel, we invest in our operations also in our infrastructure and prudent investment, of course, is two words. It means two things -- prudent, we're careful with how we invest. We want to make sure to only invest what we need and at the right times.
But investment means we actually do make those expenditures when we need to to do preventative maintenance and to think ahead and to have a five-year operating plan and to make sure we're taking care of our system so we don't have unanticipated or large expenditures down the road.
One thing we do strategy wise is we have very conservative financial targets that we make sure to hit, so we get good ratings from our rating agencies and we're able to borrow at low interest rates when we do borrow, which is only as necessary.
Of course, we have the same benefits that other municipal utilities have in that we're a non-profit, so we prioritize our affordability over profit or shareholder returns or returns on capital. So that's helpful to not have that extra layer.
And then as a nonprofit, we're also tax exempt. So we have no income tax, no sales tax, we're able to get tax exempt rates on bonds, which are usually lower interest rates and we now are able to use direct pay for tax incentives which we weren't able to do before.
And finally, we have local control, so we can tailor our operations and our requirements and our decisions and our governing body, our City Council can as well, to what our specific community needs and not have to worry about a larger footprint.
Paul Ciampoli
So as you know, a number of factors have led to increases in the amount of the utility’s required power generation capacity, known as a Planning Reserve Margin.
By 2026, CU will be required to maintain a Planning Reserve Margin of 36% during winter months, a significant increase from the current 15%.
What are the factors that have resulted in increases in the amount of the utility’s required power generation capacity? Also, how is the utility proactively working to add power generation?
Dwayne Fulk
Of course, the requirement comes down to one thing, and that was the Southwest Power Pool increased those planning reserve margin requirements across the board for all of its members, basically due to their FERC approved reliability requirement of one day of outage in 10 years.
Everyone across the country, but especially in SPP, has seen increases in thermal generation retirements because of age and additional regulations and the unknown factor of what those regulations may do in the future and also because of additional knowledge that we've gained about renewables volatility and so a lower accreditation because of that.
And when you couple that with extreme weather we've seen in Winter Storm Uri and other events since then, we need new transmission to address transmission costs and congestion fees and then we need new generation due to increasing demand. We've seen electrification across the board.
Many requests from data centers that keep escalating higher and higher -- crypto miners that still would like to get in. Oil and gas production. We're not sure about electric vehicles, when those will ramp up again, but we've certainly seen an increase in our industrial and commercial development requests. So all of those I think add up to the need for additional capacity.
Paul Ciampoli
I guess it's fair to say that the level of unpredictability as it relates to resource planning has has increased dramatically in the last couple of years as compared to say 10 or 15 years ago?
Dwayne Fulk
It absolutely has. In fact, we're in the middle of our current integrated resource planning process and we've looked at 14 different scenarios to count with our base case, so it's all over the board.
Paul Ciampoli
Just another quick follow up -- so with respect to that level of unpredictability and the challenges that come with resource planning these days, just curious in terms of how the utility is communicating with customers and just letting them know along the way where things stand in terms of planning?
Dwayne Fulk
That's an area I think we've made great strides in. I've been involved in three different integrated resource plans so far. This time we started a year in advance in educating the public on what that generation and demand challenge looks like.
Then we had a public input process where we did two different surveys.
First a straw poll of our customers and then a public poll that was available online in addition to our customer portal as well. And then we had an in-person meeting where customers could come in and ask questions.
So we've really tried to understand what our customers’ priorities are, what their concerns are and then how that matches up to what our planning process looks like.
We think that will pay off down the road when we eventually go to get approval on the rates that will support those efforts.
Paul Ciampoli
My last question for you -- I want to take a step back and look [at a] broader, bigger picture in terms of your long-term goals for the utility. Could you expand on those for our listeners?
Dwayne Fulk
So one of our goals -- which is really more near term and you asked about this previously -- is what are we doing to proactively address the capacity needs.
Within the next couple of years, we're going to be adding 150 megawatts of dual fuel and hydrogen capable combined cycle gas turbines. And then also 36 megawatts of batteries. Those batteries are zinc and they're domestically sourced and fully recyclable.
We're also piloting a demand response program for electronic thermostats, so we're trying to look at both the supply and the demand side of things.
Within the longer term, we're also still looking for opportunities in solar and additional battery storage. And since our new combined cycle units are hydrogen capable, we'll be looking at hydrogen supply as well.
And we're currently seeing an increase in interest for nuclear, so we're going to be looking at the capability of that. Our state Department of Natural Resources has instituted a new pilot program, a new study and has made us a part of it to see if there's any siting capabilities in our area.
And of course we're looking for ways to invest in transmission and so the new integrated transmission plan that SPP -- Southwest Power Pool -- has approved, we'd like to see some of those built in our area and we'd also like to invest in them as well.
Because we have the new combined cycle units, we are going to need more gas supply. We're currently at the end of one pipeline, so we're looking at a second gas pipeline and maybe some other ways to increase our gas capacity.
Our long-term goals include additional investments in our employees and making sure that we're a great place to work -- employer of choice in our area. We also want to increase the technology available to our customers to interact with us directly and to control their demand.
And then we have some long-term financial goals that involve growth so we can spread our costs out over more customers.
And then finally, we just want to make sure that we're a great community partner and that we continue to solidify our relationships with our customers and our community through direct and personal engagement.
Paul Ciampoli
One quick follow question, if I could. You mentioned zinc with respect to the battery storage plans that you have. Just curious what are the positive attributes of that as compared to say lithium ion?
Dwayne Fulk
First of all, they're intended to be non-flammable, so hopefully not a risk from a fire perspective and then I mentioned that they’re domestically sourced and so we're able to take advantage of some tax credit incentives through direct pay because of that and then they're also fully recyclable, so we believe that they may be more available in today's current political climate as well because of that domestically sourced and fully recyclable nature.
Paul Ciampoli
Dwayne, thanks again so much for taking the time of your day to speak with us and would love to have you back as a guest at some point in the future where we could discuss some of the topics that we talked about today and I'm sure there's a lot of other things that will be going on at the utility we could address as well.
Dwayne Fulk
Absolutely. Thank you, Paul.
Paul Ciampoli
Sure thing. Well, thanks again, Dwayne.
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 the public power.
