TCL&P projects include smart grid, more fiber

TRAVERSE CITY — More than $46 million in projects and upgrades over the next six years are laid out in a proposed six-year Capital Improvement Plan from Traverse City Light & Power.

The board of the city-owned utility will review the plan at its Feb. 11 meeting before it goes to the city Planning Commission for a study session on Feb. 18, followed by a public hearing on March 4. The document then goes to the City Commission for further review, with another public hearing expected in May before a commission vote to adopt the Capital Improvement Plan (CIP) and the utility’s 2025-26 operating budget.

“This is an outlook from where we are today... we have a strategic approach for what we want accomplish,” TCLP Executive Director Brandie Ekren said. “We want to invest in things that are going to positively impact our customers.”

Light & Power Chief Financial Officer Karla Myers-Beman presented an overview of the plan to the utility board earlier this month.

The utility has invested more than $57 million into TCLP assets over the past 10 years, much of it to improve the system’s reliability, bolster its renewable energy portfolio and other measures spelled out in the utility’s Climate Action Plan.

Projects identified in the plan are evaluated under various criteria including value to utility customers and staff, climate impact, operational and innovation upgrades, risk mitigation and alignment with the utility’s strategic plan, she said.

“I think we’ve done a lot,” Myers-Beman said.

Going forward, the lion’s share of the proposed CIP is for work planned in the utility’s 2025-26 fiscal year that begins July 1.

Just over $19 million is projected for various projects next year, including more than $14 million for fiber upgrades and smart grid projects including expansion of high-speed internet service to utility customers.

Smart grid work involves use digital technology to monitor and manage the flow of electricity through more-efficient distribution, improved reliability, and integration of renewable energy sources. It creates two-way communication between power plants, utilities and customers that helps the grid optimize energy use based on real-time data.

Work on the expansion of utility’s fiber optic internet service will also escalate in the latter half of the current fiscal year and the 2025-26 budget year beginning in July.

That estimated $25-million-plus project is being financed by a $14.7 million loan from the U.S. Department of Agriculture made three years ago, and another $13.5 million loan approved by the City Commission in June of 2023. Ekren said the utility is lining up contract labor to help with installation, and will expand its marketing efforts in the coming months to promote the service to TCLP customers. Ekren said the utility hopes to have the service available to all TCLP customers by early 2026.

“The key thing with the fiber expansion is that we’re building out a backbone to offer our customers access to the internet,” Ekren said. “We’re pulling together a full-court press to move this forward.”

Other work planned for 2025-26 includes more than $3.8 million in distribution system upgrades including circuit work and associated with the state’s planned road improvements along U.S.-31, several electric substation upgrades, and more underground utility work around the Park Place Hotel in downtown Traverse City.

Another technology upgrade planned for 2025-26 is implementation of a new rate analysis calculator software system estimated at $40,000 that will allow customers to monitor their energy use to save on utility costs by using power generated during non-peak usage periods.

Subsequent capital project expenditures from 2026-27 through 2030-31 range from around $4.2 million up to more than $7.8 million. Some of the future work includes nearly $1 million in street light upgrades and replacement around the city throughout the entirety of the plan, including the transition of the utility’s high-pressure sodium lights to LED lighting. Other projects include $300,000 to add up to eight new electric vehicle charging stations around the community, and $3.5 million to develop a battery storage demonstration facility at its new Customer Service Center on Hall Street planned for 2028-29 budget year.

The utility is required to have a long-range capital improvement plan under a 2008 state law designed to highlight the cost and timeline of pending public improvements.

The plan is structured into eight major categories including power generation, transmission and distribution, along with facilities, EV charging stations, fiber upgrades and joint projects with other entities including the city and the Downtown Development Authority. The plan also has to identify funding sources for the various projects, and officials said projects and priorities can shift depending on state and federal grants and other funding sources that may become available.

“If opportunities for state and federal grants arise, we’re ready for it,” Beman-Myers said.

TCLP serves more than 13,000 residential and commercial customers within the city and parts of East Bay, Elmwood, Garfield and Peninsula townships.

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