The City of Lebanon and Laclede Electric Cooperative announced Friday they have entered into discussions about the possible purchase or management of the City of Lebanon’s electric system by the cooperative.
“The Board of Directors and Management team are very interested in working along with the City to evaluate the potential benefits to both organizations and their customers. We understand it will take some time and extreme due diligence from both the City and Laclede to determine whether the economies of scale could provide a successful outcome," said Laclede Electric CEO Marc Roecker.
The talks come as both organizations assess the uncertainty of increased electric distribution costs and labor, as well as forecasted increases in wholesale power supply costs, according to a joint press release from the city and the cooperative.
According to Mayor Jared Carr, the goal of the conversation is to determine if City of Lebanon electric customers could benefit from efficiencies created through the increased economy of scale.
"Since I became mayor it has been my intention to partner and keep an open mind in regards to anything that may come our way,” Carr said. “I feel that we may possibly as a city benefit from a partnership with Laclede Electric. Whether it be selling the utility in its entirety or the management of the electric utility. This discussion is still its infancy and we want to do what is best for our community now and for the future."
The release said both parties will perform “extensive and transparent studies to assess the potential benefits to the electric consumers of both the City and Laclede Electric. These studies will include long-range financial performance, rate stability, reliability, and operations.”
According to the press release, Mayor Carr and Roecker have committed to retaining all existing employees, including the city’s electric department employees, if Laclede Electric Cooperative purchases the city’s electric system.
Officials expect these discussions will take several months before any recommendation can be made to either board, according to the press release.