Commissioners hear from energy consultant, Clay Township trustees

Following visits from several other companies, Highland County commissioners David Daniels, Brad Roades and Terry Britton met with their current energy consultant during their Wednesday, Aug. 14 meeting, while they also heard unrelated concerns from local township trustees regarding a planned park project.

As previously reported, the county is approximately one year into a three-year contract with Muirfield Energy at a rate of 6.44 cents per kilowatt hour. Representatives from two different energy companies have met with commissioners during two meetings since June 26.

Dan Ziegler, senior energy consultant and certified energy manager for Muirfield Energy, said he had seen those “meeting minutes where others have been in talking to you about energy” and wanted to speak with commissioners from Muirfield’s perspective.

“One thing we do that may not be visible to you is watching the market,” Ziegler said. “We started looking at your accounts for the renewal that was supposed to occur in December of ’22 back in August of ’21, so we started looking well in advance of the time that was required for renewal.”

Ziegler pointed out that in doing so, Muirfield recognized that it was “best for the county if you go back to the AEP standard service offer in that particular case, based on the market rates that were in effect at the time.” This is despite the fact that Muirfield makes “our commissions from the suppliers, not from the county directly,” Ziegler said.

“The savings to the county would have amounted to over $9,000 a year,” Ziegler said. “We continued watching the market, even though we stopped serving you directly, and when we saw an opportunity then to beat the upcoming AEP rate increase, we recommended the change to that. In that particular point in time, the savings were going to amount to almost $100,000 a year, going back to a market-based rate versus staying on the AEP standard service offer, so that's what we did.”

Ziegler said that one of the companies that spoke with commissioners recently had “a little bit of confusion over the contract volumes,” saying they had a “million-dollar contract value” when it was actually $360,000 for three years (not per year).

“When you talk about swing, or watching the market and trying to figure out when's the best time to execute a contract, if you're looking for that low point and you want to execute on that low point, we call that trying to catch a falling knife,” Ziegler said. “It's a very dangerous thing, because you can be waiting, waiting, waiting, and then miss the opportunity because you think it's going to continue going down. When we went ahead and made the recommendation, we had done some calculations based on the high point in the market and the low point in the market, and there was about a $32,000 swing from the best contract that we could have gotten for you at the time and the worst contract at the time.

“When we did the contract execution, we were within $12,000 a year of the absolute low point, so we think we did a very good job watching the market to make sure you got the best deal possible.”

Ziegler also addressed the “capacity change” discussed at the Aug. 7 commission meeting, which Ziegler said “is a disconnect unlike anything we've ever seen.”

During that Aug. 7 meeting, Cameron Leu of IGS Energy told commissioners that “over the last week, rates for May of 2025, through June of 2026, increased 600 percent,” due to increased demand.

“For many, many years, we would recommend a fixed all-in capacity included price,” Ziegler said. “This upcoming renewal, we're going to recommend the capacity passthrough. And why would we do that? It's because we don't know what the capacity numbers are going to be in the future, and suppliers don’t, either. Either they price them in at crazy high rates, or you're going to end up paying a passthrough anyway. The best way then to look at it is just simply energy only, let capacity be a passthrough.”

Daniels asked if his understanding was correct, that instead of seeking “an all-inclusive bid” for their next contract, “it’s your recommendation that we pay for the electrons that we're buying, and not let them include the capacity charge, and whatever that capacity charge is, that won't change. That charge is the charge, so we will then pay that like, maybe, a rider.”

Ziegler agreed. “Going forward, you'll see an energy-only price, because they can see that, they can commit to that, they can price it in, and it's fixed,” he said. “The thing they don't know, that rider, will come as it may.”

Daniels asked how often the capacity charges are updated.

“It's a fixed rate for a period,” Ziegler said. “They'll do auctions for a 12-month period. They're supposed to be at least three years out into the future, so that any supplier has three years of visibility into the capacity prices.

“Now, we're behind, and we're just now getting information 14 months in advance, rather than 38, 40 months in advance. They're going to try to play catchup. The next auction is scheduled for December, so that'll be for the period of June 1, 2026, through May 31, 2027, so we're going to start getting more clarity, but not necessarily in time for your next contract. We'll only have basically two years if you were to choose another three-year term. We will continue to recommend capacity passthrough until that number is truly visible for the entire term of your contract.”

At commissioners’ Aug. 7 meeting, Britton pointed out that shutting down coal plants was likely to blame for the capacity issues, and Ziegler confirmed that in his presentation Wednesday.

“We’re shutting down so many coal plants, and then we're bringing on renewable energy,” Ziegler said. “It’s good from the environmental perspective, but when it comes to planning for capacity needs for the future, PJM [the regional transmission organization] and the Federal Energy Regulatory Commission [the federal transmission organization] have been woefully inadequate at making sure that we've got the adequate capacity we need.”

As a result, Ziegler said, there are a lot of unknowns into the future.

“Going forward, it's going to be that very erratic number that we can't count on, because as the power plants are built to replace the ones that we're retiring, we don't know when they're coming on,” he said. “We don't know how expensive they're going to be and how reliable they’re going to be. Solar and wind take three to four megawatts to replace every one megawatt of coal that's retired because they only generate when it's sunny, when it's windy, and you don't know when that's going to be.”

Ziegler also explained to commissioners how the capacity volume is determined.

“PJM, at the end of the summer, will look back to their five highest hours of the summer — their highest numbers, not yours — and then they'll go out to every individual account in their system and say, ‘Where were you at on that particular hour?” Ziegler said. “Then they take those five numbers and average them together. That's what you're going to be charged for the following summer, for that following period.”

Ziegler said that if the county wanted, Muirfield can add them to the list to “send out notices” to avoid “surges” in demand, especially on hot summer days.

Commissioners thanked Ziegler for the information. “We appreciate you taking the time to come in and appreciate the relationship that we've had in the past with you,” Daniels said.

In other discussion, Clay Township trustees Kenneth Bohl and James Massey, who were not on the agenda, addressed commissioners about the planned park at the site on the former Clay Township school, which led to a somewhat heated exchange.

The trustees said they heard complaints for “over two hours” at their August meeting and “all the time” outside of meetings.

As previously reported, the county received $250,000 for the demolition of the former Buford school, which has been completed, and subsequent renovations. In May, commissioners opened bids for Clay Township park improvements and playground equipment. Two physical bids were submitted: one from Kiley Construction and Excavation in the amount of $199,283; and one from Fillmore Construction in the amount of $295,843, with various alternative bids also included.

“We bid it, and the bids came in way over,” Britton told the trustees. “McCarty [the project engineers] then went back and made some adjustments on that bid, so there’s still a couple things that we’ve got to get figured out.”

Bohl pointed out that with the grant they received, “it’s supposed to be done by December, and we hope that it is.” Britton said that is correct, but added that the trustees had committed to “$20,000 or $25,000” for the project as well.

“We would still be doing that, but we ain’t getting any taxes off of the solar panels,” Bohl said. “Our budget is way less than it normally is.”

“I don’t think that’s right, Kenny,” Britton said.

Highland County Auditor Alex Butler, who was in attendance Wednesday, clarified that “the land that is involved in solar projects has not been exempted yet, and PILOT payments have not started yet, but there has not been a decrease or loss of revenue to the township because of solar activity at this time.”

Britton told the trustees that they need to “get the bid and the finances to match so we can go forward,” but that the county’s ARPA funding coordinator Nicole Oberrecht is looking into some potential “cost-saving” options.

“We’re still working on it,” Britton said. “We want to get it done just as bad as you do, but we’ve got to make sure that our finances is there with the grant.”

Bohl said the trustees are “tired of complaints every month” that the project “isn’t done.”

“Well, I think they’re complaining more that you guys aren’t mowing,” Britton said.

The trustees disagreed, with Massey saying that they had “quit mowing it when you were supposed to start on it,” but have since cleaned up the property. Bohl added that contractors did “a terrible job” and left behind “pieces of concrete” that trustees had to “pick up.”

“There's pieces as big as that desk out there that I pushed up on the concrete now,” Massey said. “We can't tear our equipment up.”

“You guys were out there when they were there to clean that up,” Britton said. “I mean, you stood right there and talked to them.”

Bohl also told commissioners, “Please don't be telling people that we will clean up Buford. We don't have the funds.”

“Nobody said that. Nobody said that,” Daniels said. “I told [Buford residents] that township trustees have the authority to do so on junk cars and so on, but I said, rarely do they have the funds to do it.”

“OK,” Bohl said. “Whatever. [A resident] really got on us last night and was there for over two hours, which you probably know that.”

“No, I don’t, but nobody ever said that,” Daniels said. “People ask all the time, ‘whose authority is it? Whose authority is it to get rid of junk cars?’ You’ve got the authority to do so, and I said, rarely do they have the funds to do it by the time they take care of roads and cemeteries and all the other things that they have. So I'm sorry you got yelled at.”

Commissioners also met with two county officials during their Wednesday, Aug. 14 meeting as a followup to previous discussions on purchasing automated external defibrillator (AED) devices for Highland County buildings and on establishing a Suicide Fatality Review Committee. For more, see the story at: https://highlandcountypress.com/news/aed-purchase-suicide-fatality-revi….

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