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Financing delays sale of power plant

January 18, 2013
By Jenny Lancour - Staff Writer , Daily Press

ESCANABA - The company buying the Escanaba power plant underwent a recent financial setback but continues to work to close the sale as soon as possible.

An update on the power plant sale was presented to the public by City Manager Jim O'Toole during council's regular meeting Thursday. Council and the Electrical Advisory Committee had been informed on the status of the sale during a joint meeting the night before.

O'Toole said the company purchasing the facility - Escanaba Green Energy (EGE) - lost 10 percent of the project's funding when a financer backed out recently. EGE representatives are securing replacement funding and are confident they will get the deal closed in short order, O'Toole said .

For nearly a year, EGE has been negotiating with the city to buy the power plant for $1.6 million. EGE will also purchase the coal inventory. The company is seeking a $30 million loan to purchase the property and convert the coal-fueled facility to burn biomass.

EGE's site plan to convert the plant and construct a fuel storage yard and a processing facility was approved by the city planning commission in November.

Escanaba is selling the power plant because it is less costly for the city to purchase energy from a supplier compared to generating its own electricity by burning coal.

A special meeting of council and the EAC will take place at 6 p.m. on Wednesday, Feb. 6, to discuss the power plant issues.

In other business Thursday, council approved areas in the city being used for the Escanaba Sesquicentennial Celebration July 5-13. A variety of entertainment, activities, parades, and other events will be among festivities being organized by the Esky 150 Planning Committee.

Council approved Delta County entering into a fiber network service agreement with the city to provide data communication between the county and the county airport. The agreement is a savings to the county and is no cost to the city, said O'Toole.

The first public hearing on the city's upcoming preparation for the 2013-14 budget took place during Thursday's meeting with no public input. The next two public hearings will be held Feb. 21 and March 21 during council meetings at city hall.

In other business, council approved a three-year advertising contract with the Escanaba Daily Press.

During committee reports, council member Ron Beauchamp gave an update on Tuesday's meeting of the task force addressing homeless needs in the county. He said the committee received statistics on the area's homeless, reviewed zoning requirements, and discussed needs in the community.

Council is scheduled to meet for its next regular meeting at 7 p.m. on Thursday, Feb. 7.

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Jenny Lancour, (906) 786-2021, ext. 143, jlancour@dailypress.net

 
 

 

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