‘Reduce risk and increase the reliability’

PUC reviews potential wholesale electricity supplier contract

NEW ULM -- The New Ulm Public Utilities Commission approved equipment purchases and a cybersecurity contract Tuesday while receiving an update on the city's search for a new wholesale electricity supplier.

Utilities Director Brett Fleck Fleck updated the board on the search for a new wholesale electric supplier. New Ulm's current 20-year contract with Heartland Energy of South Dakota ends Dec. 31, 2029. 

The city's power plant operates only when called by the regional grid or during local emergencies. 

Last year the commission hired HDR Engineering and Energy and Environmental Economics for $168,000 to assist with a request for proposals, evaluations, and recommendations.

When grading proposals from potential power suppliers, the city factors price into 40 percent of the final score. The remaining 60% of the grade depends on how much financial risk the supplier will take off the city, what extra services they offer to help manage the grid, how they intend to meet state green energy mandates, and how they plan to utilize New Ulm's existing municipal power plant.

Fleck said many future variables remain uncertain, including capacity values, renewable energy certificate prices, battery storage costs, federal regulations, and local demand growth. 

PUC staff will conduct reference checks and peer utility contacts in August and September. 

Consultants are scheduled to present findings and a recommendation at the Sept. 22 meeting.

In new business, the commission authorized a three-year agreement with TSG Server & Storage Inc. for Arctic Wolf cybersecurity services at $89,998.15. 

The contract covers managed threat detection, endpoint security, and security-awareness training.

Commissioners approved a $59,683 purchase from Electric Pump and Valve Inc. for a spare recirculation pump used in the wastewater treatment plant's biological phosphorus-removal process. The existing pump has operated continuously since 2010.

"We are looking to purchase a spare recirculation pump for our biological phosphorus removal process," Chief of Maintenance at the Wastewater Treatment Plant for New Ulm Public Utilities, Jeremy Hillesheim said. "The pump that's currently there runs 24/7. It's been installed since 2010. We rebuilt it once as a preventative measure. At that time the pump company had a loaner we could use. They no longer have that option, so we thought it best to purchase a spare. If we lose that pump, it doesn't take long to lose our treatment."

The board also accepted a state-bid quote of $97,187 plus tax from Ziegler Cat for a portable generator that can serve outlying lift stations during extended outages or maintenance.

The commission authorized a not-to-exceed amount of $173,200 with Bolton & Menk for preliminary engineering on replacement blowers and a backup generator at the wastewater treatment plant. 

Two of the four existing blowers date back to 1974. A 2025 facilities plan estimated the full blower improvements at $6.5 to $7.5 million. The preliminary work is intended to place the project on a state funding priority list so the utility can pursue low-interest loans or grants.

Paul Teicher, the water/steam supervisor oversees the city’s water end district energy (Steam) department. Teicher reported an emergency $9,400 replacement of a 1994 variable-frequency drive that controls an air blower at the water treatment plant. The unit has already been installed. 

Fleck said that several items at the July meeting addressed backups and redundancy. 

"When we're making investments, we're trying to reduce risk and increase the reliability of our supply," he said.