The Board of Water, Electric and Communications Trustees had a full agenda Tuesday evening, reviewing strategic updates and approving several initiatives to support Muscatine’s long-term energy and telecom goals.
Trustees received a summary of findings from the latest power supply study conducted by Leidos Engineering. Commissioned by Muscatine Power and Water’s (MPW) legal counsel, the study evaluated future power supply options for the community.
“A power supply study is a critical tool in planning for the future,” said General Manger, Gage Huston. “While we cannot foresee every challenge ahead, these studies provide a data-driven roadmap – guided by market trends and expert analysis – that helps us make informed decisions. Our goal remains the same: to deliver reliable, affordable, sustainable and flexible electricity to our community for decades to come.”
The study reaffirmed findings from the 2022 analysis that maintaining local, dispatchable resources in Muscatine remains financially beneficial to Muscatine residents, while also being critical to the reliability of MPW’s system in the years ahead.
The study continued to evaluate alternatives to expand MPW’s renewable portfolio, adding to its mix of wind and upcoming Muscatine Solar 1 project. As MPW’s renewable energy portfolio continues to grow, the study also updated an analysis to develop a 100% renewable energy portfolio. The study reaffirmed that this scenario remains both impractical and cost prohibitive, significantly increasing the cost to deliver energy and posing reliability concerns. Huston commented, “We will continue to evaluate ways to increase the sustainability of our power supply, but we will always balance those efforts with maintaining MPW’s award-winning reliability and keeping rates below state and national averages.”
The report also confirmed that keeping Unit 9 – the Utility’s largest power source – operating on coal is the most cost-effective strategy, and a hedge against fluctuating natural gas prices. It also confirmed MPW’s decision to add the combined heat and power (EcoGen 10) unit to improve fuel diversity and reduce emissions.
Based on the 2025 study findings, MPW staff recommended the following actions:
- Continuing the construction of a small-scale combined heat and power (CHP) unit Maintain Unit 9 as a coal-fired electric generating unit and pursue environmental compliance upgrades
- Retain Unit 7 as a gas-fired, seasonal peaking capacity asset
- Pursue a second local solar energy project to fully leverage transmission interconnection rights when Unit 8 retires
- Research battery storage integration
- Continue to evaluate additional power supply options
“Reliable, affordable, sustainable and flexible electricity supply is the foundation of our service,” Huston said. “This study helps us balance innovation with practicality, ensuring we meet future demand while effectively managing the cost of power and energy supplied to MPW’s customers.”
In support of the recommendation to keep Unit 9 operational, staff presented three projects to further advance efforts required to meet the Environmental Protection Agency’s (EPA) new Effluent Limit Guidelines (ELG). Compliance with the ELG standards will take place through a series of projects and activities in the coming years. The next phase, which was approved by the Board, incorporated three projects totaling $1.7 million. Future phases could be modified depending on the status of the ELG rule, which is under review by the EPA and expected to be revised in the coming months.
“Environmental compliance is not just a regulatory requirement – it’s a commitment to responsible operations,” Huston said. “These and other upgrades allow us to continue efficiently using Unit 9 while meeting federal standards and continue MPW’s long history of environmental stewardship.”
Customers interested in MPW’s Power the Future initiative are encouraged to attend a forum scheduled Monday, October 6 during Public Power Week. The event will provide an opportunity for customers to learn more and ask questions about MPW’s long-term energy plan, the power supply study and other Utility projects.
Following the success of MPW’s two grant-supported expansions of its fiber network into rural Muscatine, MPW applied for 4 additional grants through the State of Iowa’s Department of Management to extend telecom services into other rural Muscatine neighborhoods. The project areas include:
- Hwy 61 North – New Era Rd to Sweetland Rd to M&W Trailer Court
- Hilltop Addition
- Burlington Rd
- Country Rd X61 to Kilpeck Landing
Based on a preliminary award notice, the Board authorized MPW to accept the grants with potential total grant-related project costs up to $1,749,851 and programmatic reimbursements up to $1,312,389. Upon confirmation of awards, staff will present Project Summary Forms to the Board for approval.
Trustees also approved a restructuring of residential internet offerings to remain competitive in a rapidly evolving market. The changes are based on market analysis and the growing influence of cellular providers.
MPW’s financial results were strong in July. Net income was substantially higher than budget and last year. For the month, MPW had net income of $3.0 million, which was $1.4 million higher than budget and $2.5 million higher than July 2024. Mark Roberts, director of finance & administrative services, reported, “high net MISO summer-season capacity prices continued from June, which was coupled with high energy prices for much of July and resulted in $2.4 million of favorable wholesale and fuel margins for the month.” Roberts stated, “the net financial results of energy transactions in July and prior months will result in a negative energy adjustment clause in September of 0.26¢ per kilowatt-hour; meaning it will be a credit on customers bills.”
The Board discussed possible MISO net reductions in capacity margins that result from a MISO system-modeling error that may affect all MISO market participants. The impact on MPW is currently uncertain.
Huston recognized the MPW generation team for working through difficult July circumstances. He noted, “Our team at the plant worked through heavy rains, high temperatures and equipment failure while during many hours having all three generation units running. They met the challenges that resulted in significant benefits to MPW’s electric customers.”
In other business, the Trustees:
- Approved payment for the July 2025 expenditures and transactions totaling $10,367,746.52.
- Approved the strategic direction of MPW’s Power the Future initiative, including the seven strategic recommendations.
- Approved Project Summary Form for the Unit 9 ELG – Ground Floor Bottom Ash Transport Water Capture Sump and Return System, for a total cost of $441,100.
- Approved Project Summary Form for the Unit 9 ELG – Front-End Engineering Design Project, for a total cost of $900,000.
- Approved Project Summary Form for the Combustion Residual Leachate – Landfill Rain Cover, for a total cost of $409,500.
- Set September 30, 2025, at 3:58 p.m. for a public hearing to receive comments from the public on issuance of Electric Utility Revenue Bonds up to $168 million.
- Approve the Communications Utility’s recommended MPW internet package adjustments, effective September 1, 2025.
- Approved a resolution to request the Mayor and City Council designate October 5-11, 2025, Public Power Week in the City of Muscatine.
