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Rochelle Municipal Utilities

According to Webster's Dictionary:

sus-tain-able

-able to be used without being completely used up or destroyed

-involving methods that do not completely use up or destroy natural resources

-able to last or continue for a long time

 

Our Partners in Sustainability:

Flagg-Rochelle Community Park District

Fire Chariot LLC

Rochelle Foods

Evensol LLC

Carbongreen, LLC

 

Rochelle has made quite some effort to be renewable and progressive.  RMU just completed a 312 kW PhotoVoltaic Solar Plant west of the Water Treatment Plant which is performing very well, even through the winter months.

RMU has been encouraged recently by recognition of its actions on the business justification of its solar plant as well as its committment to cogen methan re-use (Bio-Gas) re-use at the City's landfill.

Rochelle businesses are engaged in sustainability efforts as presented at various service club events.

The purpose of the Sustainability Forum is to explore ideas and review the top related sustainability policies, programs and projects that have improved the economies of local governments.  The goal of Rochelle's Sustainability Forum is to connect local government, constituents and utility customers to solutions for economic growth and a sustainable future.  

Media coverage:

Rockford Register Star 

Presentations:

pdf "How electric vehicles and renewable energy will interact together through the grid" (3.86 MB)

Presenter:
Kevin B. Martin, Ph.D.
Assistant Professor
Northern Illinois University
Department of Technology
Faculty Associate, Institute for the Study of the Environment, Sustainability, and Energy

For more information, contact Dan Westin at 815-561-2050 or

On January 5th 2015, a production well located by Flagg Road experienced equipment issues and was taken out of service. The well is now functioning. Customers may still experience a discoloration in the water. However the water discoloration will begin to decrease over time. The water is still safe for drinking and cooking.

If you have any questions or concerns, please call the RMU Customer Service Department at 815-562-4155.

Tuesday, 13 January 2015 00:00

Rochelle Sustainability Forum Kick-Off

Hot Chocolate and Cookies at Beacon on the Green January 27th 3:30 pm

According to Websters:
sus•tain•able


- able to be used without being completely used up or destroyed
- involving methods that do not completely use up or destroy natural resources
- able to last or continue for a long time

• Rochelle has made quite some effort to be renewable and progressive.  RMU just completed a 312 kW PhotoVoltaic Solar Plant west of the water treatment plant which is performing very well even in winter

• RMU has been encouraged recently by recognition of its actions on the business justification of its solar plant as well as its commitment to cogen methane reuse (Bio-Gas) reuse at the city's landfill.

• Rochelle businesses are engaged in sustainability efforts as presented at various service club events.

The purpose is to explore ideas and review the top related sustainability policies, programs and projects that have improved the economies of local governments.  The goal of Rochelle Municipal Sustainability Forum is to connect local government, constituents and utility customers to solutions for economic growth and a sustainable future. The meeting is meant to capture interest in this area.

Meeting will feature an introduction by Chester Kolodziej Freedom Field Energy of similar area and regional activities. Signup areas for interested parties will be available. Contact: Dan Westin (815) 561 2050

Monday, 12 January 2015 00:00

IMUA Scholarship Application Available

The City of Rochelle, in partnership with the Illinois Municipal Utilities Association (IMUA), is again offering a scholarship competition program for eligible high school seniors. Each eligible applicant is asked to submit an application and an essay of 500 words or less addressing their choice of one of five utility-related questions.

Applicants must be high school seniors whose parents or legal guardians are residential customers of Rochelle Municipal Utilities.

"Since its inception in 2000, IMUA's scholarship program has proven to be a very popular and successful program for IMUA, its members and the communities it serves," said Kevin M. Gaden, President & CEO of the IMUA. "Public power communities offer their customers a number of cost, service and other advantages compared to those served by other energy providers. IMUA's scholarship program is another example of how munipally-owned and operated utility systems can return value to their communities while at the same time, provide a measure of financial assistance and support to those students who wish to pursue a college education."

The deadline for submitting applications and essays is Friday March 6, 2015. A committee of municipal utility officials will select a total of four finalists, each of whom will receive a certificate and $500 scholarship award. Winners will be announced in April. Application materials are available at www.rmu.net.

pdf IMUA Scholarship Application (85 KB)

On January 5, 2015, a production well located by Flagg Road experienced equipment issues and was taken out of service.  Repairs are in process and the well is expected to be back in service on January 15, 2015.  Customers may experience a discoloration in the water, but it is safe for drinking and cooking.  

If you have any questions or concerns, please call the RMU Customer Service Department at 815-562-4155.

 

Rating Update: Moody's Affirms A3 rating on the City of Rochelle's (IL) Electric
System Revenue Bonds; Outlook Stable
Global Credit Research - 22 Dec 2014
$12.4 million of rated debt affected
ROCHELLE (CITY OF) IL ELECTRIC ENTERPRISE
Electric Distribution and Generation

NEW YORK, December 22, 2014 --Moody's Investors Service has affirmed the A3 rating on the City of Rochelle's (Rochelle Electric) $12.4 million outstanding Electric System Revenue Bonds. The outlook is stable.


RATING RATIONALE:
The A3 rating reflects the electric system's small and concentrated customer base with below average socioeconomic indicators and industrial/commercial load dominance. This concentration is balanced against a historical willingness to maintain strong and stable financial performance with steady rate increases. The rating further considers the utility's participation in Prairie State Project, which provides long-term favorable economics yet involves substantial off-balance sheet leverage ($133.3 million) given its take-or-pay contracts with the joint
action agency Northern Illinois Municipal Power Agency (A2/stable).

OUTLOOK:
The stable outlook reflects Moody's view that Rochelle Electric will continue to demonstrate its willingness to maintain a satisfactory liquidity profile and adequate financial margins to mitigate significant customer and power resource concentration.

What Could Change the Rating - UP:
The rating could be upgraded if there were notable diversification of the customer base, revenue mix, and power supply resources, while maintaining strong financial performance.

What Could Change the Rating - DOWN:
The rating could be downgraded if financial metrics deteriorate resulting in the fixed obligation charge coverage ratio remains below 1.15 times or if days cash on hand falls below 90 days on a sustained basis. The rating could also be impacted by the loss of a large customer that negatively impacts Rochelle Electric's energy load and revenue profile.

LEGAL SECURITY:

The bonds are secured by the net revenues of the city's electric system. The rate covenant requires net revenues to cover senior lien debt service by at least 1.2 times. The additional bonds test is 1.25 times annual debt service. There is a cash funded debt service reserve fund sized at maximum annual debt service (MADS) or $1.55 million. The flow of funds is an open loop structure with the annual revenue transfer to the city capped at 5% of total electric system revenue per bond ordinance.

INTEREST RATE DERIVATIVES: None

STRENGTHS:
* Rate-setting authority lies ultimately with City Council and is not subject to review or appeal by any other
governmental authority
* Power cost adjustment mechanism allows for full power cost recovery without a base rate increase
* Low on balance sheet leverage

CHALLENGES:
* Customer concentration with the top 10 customers accounting for 50% of FY 2014 operating revenue and the
largest customer, CHS' ethanol plant, accounting for 16% of operating revenue
* Concentrated power supply profile with Prairie State accounting for 51% of energy and capacity needs
* Significant off balance sheet debt ($129.5 million) associated with Rochelle Electric's 30 MW of generation
ownership in the Prairie State Project through NIMPA

DETAILED CREDIT DISCUSSION
Rochelle Electric's service area is primarily residential (84% of customers) with below average socioeconomic indicators, while revenues are primarily from commercial and industrial customers (78% of revenues). The top ten customers are predominantly industrial and account for a considerable 50% of total revenues, with the top customer, CHS' ethanol plant, accounting for 16% of total revenues. This customer concentration is partially mitigated by the diversity of the top customers which span multiple industries. The system had load growth of 2.6% in FY 2014, and management expects growth of 2-3% in FYs 2015 to 2017, due to increased investment from several industrial customers which have either recently expanded or plan to expand their presence in Rochelle Electric's service territory.

The Prairie State plant is the system's primary base-load generation resource, providing 51% of the utility's energy needs. The remaining power supply needs are sourced from spot market purchases, a 6 MW 5x16 power contract
with Constellation Energy, and a 2 MW power contract with Rochelle Energy Center. Despite construction delays, construction cost overruns and a longer than standard shakedown period, Prairie State showed improvement in
operating performance in the latter half of 2014. Newly appointed Prairie State management and the uncovering of several performance issues could result in a better performance record and improvement to a capacity factor in the 80% range in 2015. Moody's believes that the value of Prairie State as a long term asset remains favorable as a source of long-term reliable power for the participants. Direct debt levels remain modest with a direct debt ratio of 15%, yet the system has significant off-balance sheet debt of $129.5 million through NIMPA. Moody's accounts for this off-balance sheet debt in calculating the fixed obligation charge coverage ratio, which subtracts the debt component of Rochelle Electric's annual payment to NIMPA from Rochelle Electric's operating expenses and adds it to debt service instead, thus yielding a lower coverage ratio. This adjustment provides for better comparability across of all municipal utilities, regardless of if generation assets are financed on-balance sheet or off-balance sheet through JPAs. Rochelle Electric's fixed obligation charge coverage ratio dropped to 1.45 times in FY 2012, as NIMPA's debt began to amortize. With full amortization in FY 2013 and FY 2014, the fixed obligation charge coverage ratio decreased again to 1.16 times and 1.10 times, respectively. For FY 2015, we anticipate that the fixed obligation charge coverage ratio may rise
slightly to 1.22 times. Going forward, Rochelle Electric's annual portion due of the NIMPA bonds will be level at $9 million and the fixed obligation charge coverage ratio will continue to be pressured if rates are not adequately adjusted. While the City Council historically has demonstrated a willingness to raise rates, Moody's notes the potential for continued weak coverage levels without sufficient rate increases, given the significant fixed obligations.

KEY INDICATORS
System: Transmission, distribution and generation
Generation ownership in Prairie State Project: 30 MW
Total System Sales, 2014: 316,364 MWh
Top 10 Largest Customers as a percentage of total revenue, 2014: 49.5%
Senior lien revenue bonds outstanding (as of 12/2014):
Series 2005 and Series 2008: $11.285 million (A3/Stable)
Series 2014: $6 million (NR)
Rochelle share of NIMPA debt outstanding (as of 12/31/2013 audit): $129.5 million (25% of $517.87 million)METHODOLOGY SCORECARD FACTORS
Factor 1 - Cost Recovery Framework Within Service Territory: A
Factor 2 - Willingness to Recover Costs with Sound Financial Metrics: A
Factor 3 - Management of Generation Risks: Baa
Factor 4 - Rate Competitiveness: Aa
Factor 5a - Adjusted Days Liquidity on Hand (3-Year Average): 121 days (A)
Factor 5b - Debt Ratio (3-Year Average): 18.4% (Aaa)
Factor 5c - Fixed Charge Obligation Coverage Ratio (3-Year Average): 1.24x (Baa)
Grid Indicated Rating: A2
Notching: -1.0 notch for customer concentration
Scorecard Indicated Rating: A3
Note: The grid is a reference tool that can be used to approximate credit profiles in the industry in most cases.
However, the grid is a summary that does not include every rating consideration. Please see U.S. Public Power
Electric Utilities with Generation Ownership Exposure for information about the limitations inherent to grids.

Tuesday, 09 December 2014 00:00

RMU Begins Cross-Connection Survey

The Illinois Environmental Protection Agency (IEPA) requires that all water systems in the State of Illinois have an effective Cross Connection Control Program. Cross connections within the public water supply are a serious concern, as they can allow contaminants or pollutants to enter the public water system through what is called "backflow". Backflow occurs when a drop in water pressure causes your water to flow in the opposite direction. This can allow contaminated or polluted water to flow back into your drinking water. Given IEPA regulations and the dangers that exist from unprotected cross connections, it is necessary to establish and maintain an effective cross connection control program to protect both the integrity of the City of Rochelle's water supply as well as protect the water customers.

One necessary component in this program is a survey of the water system to determine where cross connections exist. A survey is being included with all of the RMU December utility bills. RMU is requesting customers complete and submit the survey to Rochelle Municipal Utilities.

Completed surveys can be returned by one of the methods listed:

• Save the form to your computer "DOWNLOAD" and submit via email to RMU

OR
• Return with utility payment
• Fax to 815-562-5861
• Drop off at one of the drop boxes located at RMU, 333 Lincoln Hwy, Rochelle, IL 61068
• Mail to: RMU, 333 Lincoln Hwy, PO Box 456, Rochelle, IL 61068

Rochelle Municipal Utilities is proud of the water we deliver every day. By working together and cooperating in this critical program, we can further protect our water from potential contamination. Should you have any questions, please contact the RMU Customer Service Department at 815-562-4155.

The Utility Advisory Board will meet on the following dates in 2018:

January 17

March 14

May 16

July 18

September 19

November 14

Meetings are held at 3pm at the RMU Technology Center located at 910 Technology Parkway.

Wednesday, 03 December 2014 00:00

RMU Introduces Interactive Voice Response System

RMU is introducing a new interactive voice response system to better serve our customers. The system is an automated telephony system that interacts with callers, gathers information and routes calls to the appropriate recipient. During normal business hours, the RMU Customer Service Representatives will still be available to answer calls. However, after normal business hours, the customer will receive voice responses for appropriate situations and have access to relevant data. For example, during a power outage, customers can report an outage and/or receive a message about the location and expected duration of an outage.

The new interactive voice response system will provide customers with more information and help RMU continue to provide excellent customer service.

If you have any questions or concerns, please contact the RMU Customer Service office at 815-562-4155.

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