A major hurdle in the gradual dissolution of North Branch Water and Light has been cleared, as East Central Energy and the North Branch City Council and NBW&L have entered into a purchase agreement for all electric assets of NBW&L, which essentially makes the approximately 2,000 electric customers of NBW&L members of ECE.

According to North Branch City Administrator Renae Fry, the purchase amount for this sale will be $5,318,943, with a closing date at some time before Dec. 31, 2022. She said part of the agreement includes a rate freeze for all customers affected by this sale. For the next three years, ECE agrees to charge those residential customers $15.08 per month for basic service, with an energy rate of 13.49 cents per kilowatt hour. Additionally, there will be the $8 per month outdoor light franchise fee that was previously imposed on all city residents.

Fry stated that it will take some time for ECE to switch over all of the meters, so the city agrees to continue reading meters and relaying the readings to ECE’s billing department until ECE is able to complete the switch. Once the closing of the sale takes place, customers will pay their bills directly to ECE. However, if a bill payment is received by City Hall, the city will transfer the payment to ECE.

Fry said the sale does not include the purchase of most of the physical assets — outside the transformers, power poles, electrical lines, etc.  — owned by NBW&L, however, individual items may be sold separately. She noted that a majority of the physical assets, such as equipment and vehicles, is older and of no practical use for ECE.

Finally, the agreement contains a non-compete clause, meaning neither NBW&L nor the city itself will jump back into the selling of power to residents.

“This is a historic moment,” said ECE President/CEO Justin Jahnz at the June 14 joint meeting of the North Branch City Council and North Branch Water & Light Commission. “It’s being watched by many across the state. There are many small municipal utilities with the same struggles for the same reasons as North Branch.

“I don’t think you have to feel like this is a failure,” he continued. “I think this is a progression. This is a step forward, not a step back.”

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