Category Archives: Utilities

Puerto Rico’s governor presses power utility privatization

Source: Luis J. Valentin Ortiz, Reuters, March 5, 2018
Puerto Rico’s Governor Ricardo Rossello on Monday pressed proposals for privatizing the U.S. commonwealth’s shattered electrical grid as part of its painstaking recovery from devastating September hurricanes. Rossello used his State of the State speech to say that he had introduced an energy reform bill on Monday, while outlining ideas for cutting taxes, increasing police pay and introducing education reforms. …


Contractors Are Leaving Puerto Rico, Where Many Still Lack Power
Source: Frances Robles, New York Times, February 26, 2018

Though hundreds of thousands of Puerto Ricans remain in the dark five months after a devastating hurricane trampled the island’s power grid, the federal government has begun to scale back the number of contractors it has working to get the lights back on. The United States Army Corps of Engineers is in charge of the federal effort to repair the power grid on the island, where a Category 4 storm last fall knocked out electricity to every home and business. The corps gave major contracts to two companies, Fluor Corporation and PowerSecure, and coordinates their work with the efforts of the island’s government-run power utility, which has also hired contractors and brought in crews from mainland utilities. At one point, there were a total of 6,200 workers repairing transmission and distribution lines across the island, about half of them working for the corps. Now that power has been restored to more than 1.1 million people, by the utility’s count — about 86 percent of the island’s customers — the corps said it would begin a “responsible drawdown” of its work force. …

Why privatizing Puerto Rico’s power grid won’t solve its energy problems
Source: Associated Press, February 7, 2018
A major barrier to restoring power is Puerto Rico’s public power utility, known as PREPA. Bankrupt, its infrastructure dilapidated, PREPA has been unable to repair the island’s devastated grid. It is also seen as corrupt. In January, some customers left in the dark for months received bills for “services rendered.” Thousands more were slapped with overcharges. … Welcoming private energy companies to the island didn’t just weaken PREPA – it also damaged the environment. As revealed in a 2017 investigative reporting series by Puerto Rico’s Centro de Periodismo Investigativo, the multinational AES badly mismanaged the ash byproduct from a coal plant in Guayama, Puerto Rico, to brutal results. …

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Curry plans to meet with union about JEA sale

Source: David Bauerlein and Nate Monroe, Florida Times-Union, February 27, 2018

Mayor Lenny Curry plans to meet with the union that represents JEA linemen, a vocal group that has led the charge against privatizing JEA. Members of the International Brotherhood of Electrical Workers, dressed in red shirts and carrying “JEA is Not for Sale” signs, have packed City Hall chambers whenever the idea has come up for public discussion. Curry’s meetings with the IBEW and other groups will unfold while a special City Council committee meets to examine the ramifications of selling JEA. … The IBEW is one of five unions representing JEA workers. Curry’s office responded to a question about other unions by referring to a statement that he would be reaching out to “all stakeholders” about JEA’s future. The American Federation of State, County and Municipal Employees generally opposes privatization, but the union hasn’t take a position yet with respect to JEA, said Mark Jordan, regional coordinator for AFSCME. …


JEA Privatization Uniquely More Complicated Than Other Efforts Around The State
Source: Ryan Benk, WJCT, December 6, 2017

Following a regular board meeting that saw departing member Tom Petway charge his soon-to-be former colleagues with exploring privatization, JEA’s board chair is calling for a swift examination of the utility’s assets. … Should the board and Jacksonville’s political leaders decide privatization is the right path, JEA would not be the first municipal utility to do so in Florida. In fact, there are even examples of voters deciding to go the opposite direction: From private to public. Still, according to one expert, the massive tentacles of JEA’s electric grid, water service and sewer system — which serve more than 450,000 electric, 337,000 water and 261,000 sewer customers in Northeast Florida — would represent one of the largest and most complicated such conversions in Florida’s history. … After a lengthy 2012 exploration of JEA’s assets and the logistics of the city splitting with the utility, the decision was ultimately made to shelve the privatization idea. The last time an audit of JEA’s value was conducted in 2007, it was pinpointed at $2 billion as a municipal utility and more than $3 billion if it went private.

… Most recently, Winter Park successfully booted Progress Energy (now Duke Energy) and municipalized. Meanwhile voters in South Daytona Beach rejected a similar effort to turn their utility public. Kurry said data on customer satisfaction is mixed. Winter Park voters are generally happier with their choice and so are those in South Daytona Beach. … Just as murky as ratepayer views on service quality, customer perception of pricing fairness is mixed across the sector. …

Over 1,600 towns, cities worldwide now reversing privatization

Source: Michael Makabenta Alunan, Business Mirror, February 13, 2018
Over 1,600 cities and municipalities in 45 countries have acted to claim back public utilities and services from private companies, of which 835 were successful cases, showing people’s initiatives to wrest control over earlier privatization moves the past two to four decades that only resulted in spiralling prices, nondelivery of services to the poor and more misery. … Significant deprivatization models and best practices worldwide were also discussed in a book, entitled Reclaiming Public Services, which is a compendium of studies documenting actual experiences from different countries and edited by Satoko Kishimoto of Transnational Institute and Olivier Petitjean. … Conference delegates told journalists that while privatization and the neoliberal policies the past decades may claim to have contributed to growth, they helped worsen global inequality. … Even in the United Kingdom where privatization started under Thatcher, there are already 64 cases of public takeovers from the private sector, called in Europe as “municipalisation” of running services for people not for profit. …

Workers’ unlikely victory over outsourcing in Tennessee

Source: Elizabeth Stanfield and Jon Shefner, Facing South, February 6, 2018
Last fall, United Campus Workers-Communications Workers of America Local 3865 (UCW) achieved an important victory for organized labor’s fight against privatization and erosion of public-sector jobs. For more than two years, they campaigned to stop Tennessee’s billionaire Republican governor, Bill Haslam, from outsourcing all state facilities service jobs. Their campaign involved multiple constituencies and tactics and played a key role in the University of Tennessee system’s decision not to participate in the outsourcing contract. The fact that this victory was won in a red state by a union without collective bargaining or dues check off is a powerful reminder of what organized workers can achieve against great odds. This victory is worth paying attention to because it reminds us that even in the face of tremendous obstacles, organized workers can win. …


University of Tennessee campuses will not outsource facilities jobs
Source: Rachel Ohm, USA TODAY, October 31, 2017

In a move celebrated by state workers on college campuses, University of Tennessee administrators announced Tuesday they will not be participating in a proposed facilities outsourcing plan pushed by Gov. Bill Haslam. The announcements by UT Chattanooga, UT Knoxville, UT Martin and the UT Health Science Center ended more than two years of speculation about whether campuses in the UT system would participate in the plan. …

Council urges Univ. of Memphis to decline state outsourcing contract
Source: Michelle Corbet, Memphis Business Journal, September 20, 2017

With the University of Memphis’ next Board of Trustees meeting set for early October, members of the Memphis City Council are asking that the group think twice before opting into the state’s facilities management contract. It’s no secret the University of Memphis plans to opt into the state’s property management contract, said Councilman Martavius Jones, who sponsored a resolution Sept. 19 urging local universities and their administrators to do the opposite. In May, the State of Tennessee entered into a contract with Chicago-based JLL to privatize maintenance, security, janitorial and landscaping services for state-owned public colleges and universities. “Based on my experience on the school board, the quality of the service, the cleanliness and the general morale suffered [when outsourced],” said Jones, who served on the Memphis City Schools Board from 2006 to 2013. …

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Iowa town’s municipal utility effort is financially feasible, consultant finds

Source: Karen Uhlenhuth, Midwest Energy News, January 17, 2018

A northeastern Iowa community could lower its electric bills by creating a municipal-owned utility, according to a feasibility study presented to its city council Tuesday. Supporters of an effort to create a city-owned electric utility in Decorah, Iowa, got a boost this week from a consultant’s report that concludes the move is financially feasible. … Talk of a municipal utility surfaced after several attempts to develop renewable energy in the city ran into policies of Interstate Power and Light, the investor-owned utility that currently serves Decorah and much of the state. …

… Although the feasibility study, conducted by NewGen Strategies & Solutions and two other consultants, signaled that municipalization could work, Johnson said he’s aware of what a long and arduous process it would entail. The City of Boulder (Colo.), for example, last November approved a tax measure that will provide the funds needed to continue exploring the possibility of creating a city utility. That process began seven years ago. … Every year there are communities that start to explore creating a municipal utility to take the place of a for-profit utility, Schryver said. Although motivations tend to vary, she said that the desire for clean energy has been the main driver recently. A few new municipal utilities have taken shape lately. In California, the South San Joaquin Irrigation District, which provides water service, recently won approval from state authorities to create an electrical utility as well, meaning it will displace Pacific Gas & Electric in that locality. … Jefferson County in Washington state formed a municipal utility in 2013 to serve about 18,000 customers who formerly purchased electricity from Puget Sound Energy. Three smaller communities — two in Alaska and one in Ohio — also created new municipal utilities in the past few years, according to Schryver. Although exploration of municipalization doesn’t always result in a city-owned utility, Schryver said it can effect change in other ways. In Minneapolis, for example, efforts to depart from Xcel Energy ceased when the utility agreed to expand its clean-energy portfolio. …

Whitefish stops work on Puerto Rico power grid over payment dispute

Source: Brandon Carter, The Hill, November 20, 2017
Whitefish Energy, which is under scrutiny over how it was selected for work in Puerto Rico, is halting its efforts on the island’s power grid because it says the local power authority owes it millions of dollars.  In an interview with CNN published Monday, Whitefish CEO Andy Techmanski said the company is owed more than $83 million by the Puerto Rico Electric Power Authority (PREPA) and is stopping work because its repeated requests for payment were not fulfilled.  “We stopped because of the financial situation, lack of payment with PREPA has gotten beyond its maximum threshold and what we can sustain as a business,” Techmankski said.  The company’s CEO said that it has employed more than 500 contractors and subcontractors on its work to restore the island’s power grid following the devastation caused by Hurricane Maria. …


Ricardo Ramos, embattled head of Puerto Rico’s power utility, resigns
Source: Phil McCausland, NBC News, November 17, 2017
The embattled head of Puerto Rico’s power utility resigned on Friday, the latest controversy to hit the island as it struggles to bring its electric grid back online. Ricardo Ramos, the executive director of the Puerto Rico Electric Power Agency, submitted his resignation to Puerto Rico’s governor’s office only a few days after he testified before the Senate Energy and Natural Resource Committee over the controversial contract he approved with Whitefish Energy Holdings, a small Montana firm to rebuild Puerto Rico’s electric grid.  A few hours after Ramos resigned, Puerto Rico Governor Ricardo Rosselló recommended the appointment of engineer Justo González as interim director of the public utility.

After Doomed Whitefish Deal, Puerto Rico Asks Congress for $94 Billion
Source: Frances Robles, New York Times, November 14, 2017

The governor of Puerto Rico and the chief executive of its beleaguered electric company faced hours of questioning on Tuesday in Congress, where skeptical legislators questioned whether to give the island an enormous aid package on the heels of a botched high-priced contract to fix its power grid.
Gov. Ricardo A. Rosselló came to Senate and House committees with a huge ask: $94.4 billion to help Puerto Rico “build back better” after Hurricane Maria destroyed or damaged 472,000 homes and knocked out the island’s electricity. He also said that Puerto Rico should have more authority over its own fiscal affairs, and that he had “zero role” in awarding a highly criticized $300 million deal to a small Montana firm to help restore power. …

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Report: Gov. Henry McMaster considering Santee Cooper sale to help pay for nuclear project

Source: David Wren, The Post and Courier, August 8, 2017

Gov. Henry McMaster is reportedly considering selling state-owned electric utility Santee Cooper as a way to pay for at least one of two nuclear reactors at the V.C. Summer Nuclear Station near Jenkinsville. The Wall Street Journal reported Monday that McMaster is “pursuing several options” to raise the money needed to finish the project, which Santee Cooper and South Carolina Electric & Gas abandoned last week in the face of rising costs and the bankruptcy of lead contractor Westinghouse Electric. …

Congress must continue to block Trump plan to sell BPA

Source: Union-Bulletin Editorial Board, August 8, 2017

Late last month the U.S. House Budget Committee approved a budget resolution that rejects privatizing the transmission assets of the Bonneville Power Administration proposed by the Trump administration. A great move. The sooner this lousy proposal is dead the better it will be for Pacific Northwest residents who pay power bills — pretty much all of us. … President Donald Trump is calling for turning over the transmission network of power lines and substations owned by the Bonneville Power Administration, a federal agency that distributes most of hydropower from the Columbia and Snake rivers’ dams, to private companies. As Trump sees it, this would lower costs to taxpayers and improve efficiency. But in reality it would result in far higher rates for consumers. And putting the high-voltage grid in the hands of private investors — perhaps foreign investors — would create national security concerns. …


Down the Mighty Columbia River, Where a Power Struggle Looms
Source: Kirk Johnson, New York Times, July 28, 2017

To ride down the Columbia River as the John Day Dam’s wall of concrete slowly fills the view from a tugboat is to see what the country’s largest network of energy-producing dams created through five decades of 20th-century ambition, investment and hubris. … Now, the Trump administration has proposed rethinking the entire system, with a plan to sell the transmission network of wires and substations owned by the Bonneville Power Administration, a federal agency that distributes most of the Columbia basin’s output, to private buyers. The idea is part of a package of proposals that would transform much of the infrastructure in the United States to a mixture of public and private partnerships, lowering costs to taxpayers and improving efficiency, administration officials said. Assets of two other big public power operators, based in Colorado and Oklahoma, would be sold, too, if Congress approves the measure.

Debates about government and its role in land and environmental policy are always highly charged. But perhaps nowhere could the proposed changes have a more significant impact than along the great river of the West — fourth largest by volume in North America, more than 10 times that of the Hudson. Privatization would transform a government service that requires equal standards across a vast territory — from large cities to tiny hamlets — into a private operation seeking maximum returns to investors. …

This Is How the Trump Administration Will Privatize Our Infrastructure

Source: David Dayen, The Nation, June 20, 2017
North Miami Beach’s Norwood water treatment plant is a major source of revenue, serving a region with almost five times as many customers as city residents…. Critics, including plant employees and members of the local Public Utilities Commission, blamed the city for intentional lack of investment and reduced staffing. “It’s on the city workers somehow that the system has fallen into disrepair,” said a spokesman with AFSCME Florida. “If you’re a journalist, and the newspaper is not making money, is that on you?” … As for plant workers, they could lose benefits under CH2M immediately, since the city’s contract with AFSCME expired in 2015. The CH2M contract calls for $2.4 million in annual savings in labor costs starting in year two. And with a fixed fee for operations and maintenance, CH2M can only extract profits and deliver long-term cost savings by cutting corners. …


North Miami Beach Gives Public Water Utility Serving 180,000 People to Private Firm
Source: Jerry Ianelli, Miami New Times, May 17, 2017
None of those facts stopped the North Miami Beach City Commission last night from voting 4 to 2 to outsource its public water utility to global engineering firm CH2M Hill. From here on out, the company will control virtually every operational facet of a water plant that serves more than 180,000 people in North Miami Beach, Aventura, Sunny Isles Beach, and Miami Gardens. … On April 3, the city held a special meeting to begin formal negotiations with CH2M. In the leadup to that meeting, the city’s municipal worker’s union, the American Federation of State, County and Municipal Employees, spoke out against the privatization plan as an attempt at union-busting. The ASFCME warned that privatization deals tend to lead to job or benefits cuts to workers.  Though the final contract guarantees that all city workers who pass a drug test and physical must be rehired by CH2M, the contract does not say what will happen to those workers in the following years. (During that April 3 meeting, multiple city workers accused the government of willfully underfunding the plant to create an excuse to privatize it.) …

North Miami Beach to Vote on Privatizing Its Water System Tomorrow Despite FBI Probe
Source: Jerry Iannelli, Miami New Times, May 15, 2017
On April 3, the City of North Miami Beach started negotiating with a global engineering firm to take over the city’s water utility, which services close to 200,000 people in north Dade. Clean-water activists vehemently opposed the move, citing research that water utilities run by private companies tend to get much more expensive over time, and typically provide services at “cheaper” rates by cutting staff or services. … But those facts have not mattered at all to North Miami Beach’s elected officials. Tomorrow, the city commission will vote on whether to hand the utility’s operations over to CH2M Hill Engineering for an annual fee of $18.8 million per year. (The city would retain ownership of the utility, but CH2M would handle the plant’s day-to-day operations. The city will also pay CH2M $19.3 million in the first year to cover startup costs.) …

North Miami Beach Moves Forward With Water-Privatization Deal Despite FBI Probe
Source: Jerry Iannelli, Miami New Times, April 4, 2017

At the beginning of North Miami Beach’s meeting last night about a plan to privatize its water system, City Manager Ana Garcia asked residents to trust the city based on the commission’s track record. That was an odd appeal, considering Mayor George Vallejo is the subject of an ongoing Miami-Dade County criminal probe and the FBI and Miami-Dade County Public Corruption unit have launched investigations into the water negotiations. Despite all of those red flags, commissioners voted 4-2 last night to move forward with the plan after a testy meeting that lasted close to three hours. … The city also did not disclose that an affiliate of the leading company bidding for the project, global engineering firm CH2M Hill, has held a temporary contract to operate portions of the plant since October 17, 2016. The contract raises additional questions as to whether the city’s bidding process has been fair. … The vote authorizes the city to begin negotiating a contract with CH2M, which is angling to take over the full operation of the city’s water plant.

… Per the terms of the city’s request for quotation, the private company is expected to take over full plant operations and take over the contracts of every employee at the utility. The American Federation of State, County and Municipal Employees (AFSCME), a union that represents the utility workers, says roughly 80 employees could be affected. The union warned last week that privatization deals tend to lead to benefit cutbacks and employee layoffs as the new company tries to cut costs. AFSCME does not have an active contract with the city, and union representatives warned last week that, without a contract, a private company could cut benefits and salaries from day one. …

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Lexserv to Temporarily Shut Down While City Takes Over Service

Source: WTVQ, May 8, 2017

A temporary shutdown of the LEXserv online and phone bill payment system has been scheduled as Lexington’s Division of Revenue takes over the service from Greater Cincinnati Water Works. Beginning May 15, the city will manage all LEXserv customer service and billing services, eliminating the need for outsourcing. Officials say some of the many benefits include:

  • City will save taxpayer dollars by moving system in-house;
  • Customer service will be handled by LFUCG staff in Lexington, creating jobs;
  • Payments will be mailed to a Lexington address for processing;
  • New web portal for customers to make payments, review billing. …