Mark Fritsch

by: Mark Fritsch, General Manager

Once again this month’s topic is “Year in Review”. Looking back on 2015, several significant achievements are noteworthy. The power plant re-purposing project was celebrated with our open house and about 1200 people joined us for tours and presentations. We continue to receive awards and recognition for our results.

This year we made significant progress toward moving our electrical distribution lines from overhead poles to underground conduit as Jaguar Communications had a full year of work accomplished. This four year effort to install underground conduit will allow us to continue the transition of moving our electrical cable underground over the next twenty years. Key benefits for this include improving our reliability, storm hardening our distribution system and giving customers a choice for broadband communications.

Construction work began for the new Owatonna Energy Station. You’ve probably seen the ground being excavated and foundations being formed just north of our west substation, and west of Fleet Farm on Bridge Street. This 38 MW gas fired unit will be owned and operated by our wholesale electric provider, SMMPA, and will benefit us in many ways, including providing local power if we lose both of our two electrical transmission supplies into the city.

Safety is such an important part of our work. I’m so proud of everyone for helping us achieve over 800 days without a work related injury. Our people consistently identify potential hazards, develop methods to deal with them and look out for each other.

Each year individuals and teams are recognized for cost savings, cost avoidance or innovative ways to reduce costs. This is the fourth year that we have saved over $100,000 in new initiatives, and this year we are setting a new record of close to $200,000. Many of these ideas continue to bring savings year after year.

Improvements in our work processes, technology and the efforts of all our employees have resulted in keeping our controllable expenses low. We are projecting next year’s expenses to be the same as 2015. This includes labor costs, benefits, and ongoing expenses. These reductions have allowed us to fund capital improvements and projects such as re-purposing our power plant without having to raise rates. The cost we control on the electric side of the business is about 20% of our budget, the other 80% is what we pay for electricity from our electric provider SMMPA. We’ve done a great job of controlling our costs, but it is not enough to offset cost increases from SMMPA.