The city of St. Charles is continuing to talk about its electric utility’s future, namely whether it wants to keep getting its energy from the Illinois Municipal Electric Agency or find a different source.
With a deadline to approve a contract extension with its current provider approaching on Aug. 19, a final vote on the matter may be taken at the Aug. 18 St. Charles City Council meeting.
Currently, St. Charles is one of 32 municipalities across the state that are part of the Illinois Municipal Electric Agency, or IMEA. The IMEA is a nonprofit joint action agency that sells electric power to municipally-owned utilities, per its website.
St. Charles’ current contract with IMEA is set to expire in 2035, according to the city, but IMEA has told the city it needs to decide by Aug. 19 whether it will extend its contract to 2055.
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A similar situation is playing out in Naperville, which also has yet to renew its contract with IMEA, according to past reporting.
Last year, St. Charles began discussing the new IMEA contract and weighing power supply options. It also created an IMEA working group made up of Mayor Clint Hull, City Council members Ryan Bongard and Bryan Wirball, City Administrator Heather McGuire, Public Works Director Peter Suhr, Assistant Director of Public Works Chris Adesso, representatives from Tri Cities Clean Energy and an independent energy consultant, per the city’s website.
Most recently, at the July 28 City Council Government Services Committee meeting, council members heard a presentation from and asked questions of Shawn Kestler, the president of Kestler Energy Consulting, LLC, who has been advising the city on its power options going forward.
City Council members’ questions focused on concerns like renewable energy and pollution, and what going with an alternative provider for the city’s power supply, rather than IMEA, might look like.
St. Charles began purchasing partial electric power for its electric utility with IMEA in 1999, according to the city, and entered into its current contract to get all of its electric power from IMEA in 2004. A new contract would mean St. Charles would receive energy through IMEA from 2035 to 2055.
As of July 25, 29 of 32 IMEA members had elected to extend their contracts with the cooperative electric supplier, per the IMEA. St. Charles and Naperville are two of the three municipalities still undecided. The agency previously set an April 30 deadline, but granted an extension until Aug. 19.
Now, the remaining municipalities are tasked with making a decision in the coming weeks, in time for the IMEA’s August board meeting. Each community that’s a member of IMEA gets a vote on its Board of Directors.
St. Charles’ current contract extends until at least Sept. 30, 2035, and can then rollover annually until 2040, until terminated by written notice five years prior, per the agreement’s terms.
The city has a couple of options, Kestler explained. It could sign the proposed IMEA contract as-is. If it doesn’t, he explained at Monday’s meeting, it could also negotiate with IMEA in the future, forming a new contract. Alternatively, it can seek a new power supplier entirely: through an agreement with an alternative provider, by joining a different joint-action agency or by self-supplying and managing all or some of its power supply.
Among the concerns being raised about the IMEA contract is the potential environmental ramifications.
One of IMEA’s primary suppliers is a downstate coal plant called Prairie State that was one of the top 10 biggest polluters in the country, according to 2023 data from the United States Environmental Protection Agency.
One of the discussion points related to the city’s potential IMEA contract renewal is environmental concerns.
For example, at a press conference Monday, a group of residents and advocates gathered to urge the St. Charles and Naperville city councils to vote against extending their contracts with IMEA, citing concerns about its reliance on coal and potential negative financial consequences.
“I am deeply concerned about the prospect of St. Charles signing a long-term contract that ties us to a form of energy that is not good for our planet and not good for the people who live on it,” said Lynn Elam, a St. Charles resident, at the press conference. “If we are playing the long game, as IMEA is asking us to do, we should be strategic, not tactical. It is not strategic to sign away our chances for a better climate and a better future.”
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IMEA’s 2024 sustainability plan cites a goal of reducing carbon emissions from its power supply to net-zero. But Kestler said IMEA’s power supply is expected to still be reliant on majority coal for years to come, though he noted that Prairie State, for example, would eventually need to comply with requirements put forward by Illinois’ Climate and Equitable Jobs Act.
North of Chicago, Winnetka, another IMEA member, recently voted to continue its contract, despite concerns about the agency’s dependency on coal, according to past reporting.
Should St. Charles decide it won’t be continuing with IMEA, it could enter into a competitive bid process to find an alternative power supplier, a process that Kestler estimated would begin around 2029 or 2030.
Kestler described that option as “pretty hands-off,” not requiring additional city staff or infrastructure because it’s full-service.
In that option, the city would form a contract with the supplier, and could have some control over the power supply mix — including a higher percentage of renewable energy. But he said 100% green energy would be “next to impossible and incredibly expensive,” though the city might be able to have a net-zero emissions power supply or a majority renewable energy.
According to Kestler’s presentation, two suppliers, Constellation Energy and NextEra Energy, gave presentations to the city’s IMEA working group about potentially providing power to St. Charles. These contracts would be shorter-term than the IMEA renewal, Kestler said, and noted that the city can’t know with certainty what power costs will look like in the future, though he said he suspects renewable energy costs will come down over time.
As for the city’s ability to increase its share of renewable energy, Kestler noted that Constellation, for example, uses carbon-free nuclear power.
In terms of other options, the city could also join a different cooperative supplier or self-supply, but the city’s working group has said it considers both options to be impractical for the city, per the presentation at the July 28 meeting.
Now, the contract decision is set to go to the St. Charles City Council Government Services Committee for continued discussion and a vote on Aug. 11, according to the city. From there, the City Council would take a final vote on the matter at its Aug. 18 meeting, one day before IMEA’s contract extension deadline.