Burlington Electric Department,Republican mayoral candidate Kurt Wright dropped the first bomb shell of the Burlington mayoral race yesterday with his suggestion that the city should sell the Burlington Electric Department. Wright explained that the sale would help pay for mounting debt in the city’s largest city, in particular a looming $50 million shortfall in the pension fun, a $17 million budget deficit and the on-going mess with Burlington Telecom, which along with being a financial failure to date is dragging the city’s, BED’s and Burlington International Airport’s credit rating down with it.Wright, a state representative and former chairman of the City Council, emphasized that this would not be a ‘fire sale.’ He said BED is a valuable city asset. If the city could not get a reasonable price, then it should not be sold. He said the utility could fetch more than $100 million net of debt and go a long way toward restory the city’s financial situation. BED employs about 130 and last year had revenues of $54.3 million. The McNeil generating facility is in the city’s Intervale section and its headquarters or on Pine Street. BED owns half of the 50 megawatt McNeil plant (for perspective, the Vermont Yankee nuclear plant is 605 MW).BED’s overall rates are 13.41 cents per kilowatt hour (state of Vermont, 2009), compared to the statewide average of 12.69 cents. Green Mountain Power was 11.89 cents and CVPS was12.67. The New England average was 15.86 cents; the US average was 9.98 cents.Along with paying off debt, shedding the city of BED would get rid of some risk for the city. BED has thrived in recent years as the price of natural gas has come down. The power it produces also looks relatively cheap compared to the rest of New England, which has high electric costs compared to most of the rest of the nation.Vermont in general has relatively lower rates than most other New England, and indeed Northeast, utilities, with only Maine having lower overall rates in the region for 2010 (For 2010, New England rates generally went down slightly and Vermont’s went up, putting Vermont second to Maine for 2010 where it was first in 2009). BED is lower than nearly all of them, giving ratepayers in Burlington a bit of a break.The McNeil generating plant burns wood or gas (and can burn fuel oil). When needed, BED contracts to buy power from sources that are in sync with the overall ethos of the city’s progressive politics. It does not have any contracts with nuclear plants.But this current rosy picture was not always the case and if the cost of wood or natural gas were to skyrocket, or other sources, such as nuclear is now seen doing, become much cheaper, then BED power could be relatively expensive.Needless to say, the reaction from the mayor’s office was swift.Progressive Mayor Bob Kiss said in a statement soon after Wright’s announcement that: ‘Kurt Wright’s proposal to sell the Burlington Electric Department is short-sighted and irresponsible. BED is a tremendous asset of the City. As a municipally-owned utility, it reflects important values of local rate-payer control and public accountability. BED is widely-acknowledged as one of the nation’s leading utilities with respect to the use of renewable energy sources. Selling an asset like BED for a one-time benefit undercuts Burlington’s future. It’s a short-term gimmick that lacks prudence and vision.‘The urgency suggested by this proposal is misplaced,” the mayor said. “The City is working towards constructive solutions for issues such as Burlington Telecom and the pension fund. Despite the national economy Burlington has been successful in attracting new businesses and jobs, strengthening the City’s infrastructure, and building sustainable municipal budgets that have continued to deliver quality services without the need for a general city tax increase over the last 6 years. Proposing to sell BED under these circumstances is an erratic solution to circumstances that require steadiness and careful consideration.’Vermont State Representative and Democratic mayoral candidate Jason Lorber also decried Wright’s suggestion to sell Burlington Electric.‘Kurt Wright is trying to sell out our city and Burlington values,’ said Lorber.‘Selling out Burlington Electric to private hands would be committing financial malpractice,’ he said. ‘Burlington Electric saves residents money, while reducing energy consumption. I believe that energy-independence and efficiency are paramount to sustainability. That’s what Burlington Electric does, while saving money. Burlington Values our people, our environment, and workers far above a fast buck.’
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