It's not every day one hears of government agencies pinching pennies. But at the Big Bear Area Regional Wastewater Agency, that's exactly what is happening when it comes to the electric bill.
BBARWA saved nearly $60,000 in electricity costs in November, December and January by switching to its natural gas-powered generators to produce electricity. “I'd say within the last three months we've saved 90 to 95 percent,” said Joe Hanford, plant superintendent.
Hanford monitors natural gas prices on a weekly basis, and when costs drop to $6.30 per mbtu, it's cheaper to run the generators than purchase electricity from Bear Valley Electric. BBARWA speculates when natural gas prices are going to be at their lowest, locks in the price and signs a contract. “The danger of doing that is if we lock in at a rate and it continues to go lower,” BBARWA General Manager Steve Schindler said. “So far we've been fairly successful.”
BBARWA purchases natural gas by utilizing two to three different contractors. “There's always an issue on why can't Bear Valley Electric do what we're doing,” Schindler said. “That's comparing apples and oranges.”
Because of environmental restrictions, Bear Valley Electric's lean-burn generators can't run continuously, Schindler said. “We have rich-burn generators and we can run them 24/7,” he said. “It's much simpler for us to use and account.”
BBARWA installed its first natural gas generator in 2004 and a second generator in 2007. “It took a lot of staff work to convince our government body that it was cost-effective,” Schindler said. “We knew at the time that Bear Valley Electric would likely ask for a rate increase.”
Schindler said BBARWA borrowed money to install the generators and construct the housing for them. Total cost of the installation was $976,000 and the agency carries a 20-year $500,000 debt.
Winter is the busiest season for BBARWA. “Typically we do use more power beginning the week before Thanksgiving through the middle of March,” Schindler said. Plant staff was ready for the influx of tourists and part-time residents during the Presidents Day holiday weekend. BBARWA was expected to continue to run its operation on generators during the peak holiday period. So long as the gas prices remain low, Schindler expects BBARWA to generate its own electricity. “If it's economically feasible, we'll take advantage of low natural gas prices,” he said. “So long as we can generate power for less than purchasing it, we'll do it.”