BY GABE LICHT
DELANO, MN If Delano Municipal Utilities wishes to sell energy capacity, the utility is required by federal law to reduce emissions by 70 percent.
“The only way to do that is to install catalytic converters,” DMU General Manager Paul Twite told the Delano Water, Light, and Power Commission during an Oct. 17 meeting.
DMU staff sought bids for the catalytic converters, and received bids for combination units with mufflers of nearly $600,000 and more than $800,000, before receiving a bid of $255,000 from Bergari Solutions, of Rosemount, for just the catalytic converters.
The commission approved the purchase of the catalytic converters, which will require a 50 percent down payment to enable Bergari to purchase the needed platinum.
A loan from the Minnesota Municipal Utility Association will fund the purchase.
“MMUA has a finance program, so if we don’t want to dip into our cash reserves, once we send them the application, they will search for the best deals,” Twite said. “We can set the terms, the duration, how much we want to pay on principal and interest, and they’ll go shopping.”
The interest rate is expected to be between 2 and 4 percent.
Before agreeing to the purchase, commissioners asked why the catalytic converters could not be purchased as they are needed to fulfill DMU’s capacity contracts.
“If we do just generators 6 and 7, Bergari would have to rework their quote,” Twite said. “Then, we’d go back next year and ask for generators 2 and 3. It would be more expensive.”
Commissioners asked if there is a guarantee that the catalytic converters will reduce emissions by the required amount.
“It’s in the quote,” Twite said. “We’re holding them to a minimum performance.”
Twite also noted that Bergari is a vendor for the Caterpillar components that the Glencoe utility installed, while foreman Jim Griebel added that utilities that installed catalytic converters from Bergari are reducing emissions by more than 90 percent, and up to as much as 95 or 96 percent.
Odds and ends
In other business, the commission:
• approved holding a balance of $5,000 in the State Bank of Delano revolving fund and authorized using the account for purchases through bank-issued VISA cards.
• asked Commissioner Betsy Stolfa to ask the Delano City Council if the city would like to partner with DMU to move a transformer away from Mayor Dale Graunke’s building at 144 River Street, in conjunction with the parking lot resurfacing project.