Huntsville City Council Work Session: Community Energy Resource Plan Presentation - February 27, 2026
Huntsville City Council Work Session: Community Energy Resource Plan Presentation - February 27, 2026
On February 27, 2026, the Huntsville City Council convened a work session to receive a presentation from Huntsville Utilities CEO Wes Kelly on the Community Energy Resource Plan (CERP). The session was held at 11:30 AM in the council chambers with no public comments and no action taken. The meeting focused on the CERP's findings, recommendations, and next steps for ensuring long-term reliability, affordability, and sustainability of the city's electric system.
Discussion Items
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CERP Overview and Process: Wes Kelly presented the CERP as a strategic planning effort initiated by Mayor Battle to address the rapidly changing energy landscape. The plan involved seven all-day workshops with the Energy Task Force, composed of council appointees, mayor appointees, and utility board members, supported by consultant Black & Veatch. The workshops covered topics such as TVA dynamics, economic growth projections, demand-side management, grid modernization, local generation, and governance.
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Risks Identified: The CERP identified three primary risks: (1) uncertainty with TVA due to leadership churn, evolving generation plans, and transmission challenges; (2) high load growth, especially on the west side of Huntsville (Greenbrier area), which could hinder economic development and reliability; (3) complex governance structure that complicates decision-making and contracting.
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Growth and Load Forecasts: Kelly presented data showing Huntsville's population and energy demand growth over 25 years, noting that actual energy growth averaged 2% annually, while TVA's forecast for the region was only 0.2%. He contrasted city planning projections (residential and business growth) with TVA's lower estimates. The CERP used low and high growth scenarios, with the high scenario extrapolating past growth plus 50-megawatt economic development projects every four years.
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TVA Power Supply and Data Centers: Kelly reviewed TVA's generation mix (declining coal, increasing natural gas and nuclear, stable hydro and solar) and noted that data centers now represent 16% of TVA's industrial load, up from 1% in 2019. He stated that TVA is working on rate changes to prevent data center costs from being socialized across all customers. Councilman Kling expressed concern about residential customers subsidizing data center infrastructure. Mayor Battle confirmed that data centers are not a target for Huntsville's economic development due to low employment density.
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Governance Consolidation: The CERP recommends consolidating the three separate utility boards (electric, gas, water) into a single board to simplify legal, financial, and operational processes. Kelly outlined four objectives: single legal entity, single board, clear authority to generate and transmit power. He compared options: amending statutes, adopting Public Act 175 (an existing state law), drafting a private act, or using city ordinances. He noted that a private act could be customized but requires legislative approval, while Public Act 175 provides a ready framework but removes rate-setting authority from the council. Bond counsel Rod Cantor explained that under Act 175, the articles of incorporation could address council oversight, and rate covenants with bondholders must be preserved.
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Councilmember Watkins' Opposition: Councilmember Michelle Watkins strongly opposed consolidation, arguing it would dilute specialized expertise (each utility operates under different regulatory frameworks), reduce transparency and accountability, and increase risk. She criticized a previous lack of transparency regarding a Tesla battery installation in District 1, stating that the 83,000-pound battery was presented simply as a four-megawatt hour battery without disclosing its brand, weight, or potential environmental impact. She demanded a community meeting with environmental impact study before installation. Kelly acknowledged her concerns and committed to the meeting.
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Grid Modernization and Local Generation: Kelly described plans to upgrade the 46 kV transmission system to 161 kV for resilience, deploy advanced metering and DER forecasting, and install a 2-megawatt hour battery as a pilot. Local generation options include solar (45 MW planned in Triana area, adding to existing 30 MW at Toyota), utility-scale battery storage, and evaluating waste-to-energy with the solid waste disposal authority. He also discussed demand-side management programs: time-of-use rates, smart thermostat controls, water heater controls, and rooftop solar (Solar Connect program with two pilot customers).
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Pipeline and North Alabama Public Energy District: Councilman Meredith questioned the progress of the natural gas pipeline project. Kelly reported that Volkert is completing a corridor study and by summer 2026, 30% engineering design will be ready for a go/no-go decision. He clarified that the North Alabama Public Energy District (NAPED) is currently a planning board formed under nondisclosure agreements to negotiate with pipeline companies, and any future capacity agreements will come before the council.
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Rate Comparison and Affordability: Kelly presented a chart showing Huntsville Utilities' residential electric rates ($146.90 for 1,200 kWh) are among the lowest in the region, significantly lower than Alabama Power ($208.62). He explained that about 80% of a customer's bill goes to TVA, with the remaining 20% covering HU's operational costs. The recent bill redesign broke out TVA's fuel cost adjustment as a separate line item to improve transparency.
Key Outcomes
- No formal action was taken at the work session, as per the meeting's stated purpose.
- Next steps: The council will continue discussions on governance restructuring, with options including a private act (subject to legislative approval) or adoption of Public Act 175, which may require addressing rate-setting authority. The council expects to receive the Act 175 statute language and further analysis.
- Community meeting required: Councilmember Watkins secured a commitment from Huntsville Utilities to hold a community meeting in District 1 to present the environmental impact of the Tesla battery installation and address resident concerns.
- Continued TVA engagement: Huntsville Utilities will continue working with TVA on the new MPRO rate structure and transmission upgrades, with a focus on ensuring that data center costs are not socialized across all ratepayers.
- Implementation plans: The CERP's recommendations on demand-side management, grid modernization, and local generation will be further developed into implementation plans, with periodic updates to the council.
Meeting Transcript
Y'all are just so obedient. I'm not used to that. You've got 30 seconds, you can still talk to each other. No. All right. Welcome everyone. It's 1130, and we are convened in the chambers of the Huntsville City Council in Huntsville, Alabama, for this work session, which will feature a presentation of Huntsville Utilities CERP presentation, and that will be followed by City Council discussion of the CERP presentation. No action will be taken at this meeting. The meeting is being televised. And we it is open to the public and we have members of the public here. There will, however, be no public comments. So we the only purpose of our meeting today is the CERT presentation, and we look forward to having uh Huntsville City Utilities CEO Wes Kelly present that for us. And so, Mr. Kelly, if he'll approach the diast uh the podium there, we will let you get started, introduce the members of your team, and um walk us through the presentation. Thank you very much. Wes Kelly with Huntsville Utilities, and it's a pleasure to be here today. Usually we are here at night. The sun is shining. I don't it's uh nice day. So, yes, there's a good number from the Huntsville Utility team. I want to start by uh recognizing the board members that are present, both of the electric board and the gas board. So if the Huntsville Utility Board members will please stand. Welcome and thank you for your service. Thank you very much. And then we have several members of the Energy Task Force that was appointed by this council, the mayor and the utility boards. If the uh task force members that are present would please stand. Thank you. Thank you. Appreciate y'all's uh attendance. And then uh we have several uh HU uh employees that are here, Chris Jones, our Chief Operating Officer, Daniel Kaufman, our General Counsel, uh a number of other Huntsville utility leaders are in the room, and I appreciate their presence so that uh they can correct me if I say something amiss. Thank you all for being here, and thank you for your contributions. All right. Well, our agenda today is um, as you said, is is single topic, uh, but it is actually a fairly broad topic. The community energy resource plan was something that was a uh a brainchild of of Mayor Battles as uh I I I well remember the meeting. Uh, Mayor Battle and I and Shane Davis and Chip Cherry and Joe Rich and others were sitting around a table at the chamber thinking about all of the issues that are in front of us and the complicated energy environment that is coming and how our community is going to respond to that. And uh the mayor had the foresight to say, you know what we probably need to do. We need to get a group of people together that will spend the time to deep dive and analyze these issues and then come forward with a set of recommendations. So that's what you see uh uh being the fruit of of this labor. So um we're gonna go through the sort of the the bottom line recommendations. Uh we're gonna talk about some of the growth analysis that was used throughout this uh um process. We're gonna talk briefly about TVA energy plans, and uh I see Robbie is here from TVA, so we do have a representative from TBA with us today. We'll talk about the preliminary findings and obviously the most important part discussions and next steps. So the purpose of the community energy resource plan was to help Huntsville utilities respond to a rapidly changing energy landscape. It wasn't that long ago. Electricity seemed about as straightforward as turning on the faucet or firing up the range. But over the last especially 10 years, this has gotten far more complicated. If you read any major national publication or magazine, you will now see that energy has its own section and often it is energy and environment, because those two things are inextricably linked now. And um national policy has shifted from uh where utilities were something that was a boring issue to now it's front of mind. And uh that has created transition in the marketplace, uh meaning the way that we buy our power. And we needed to know how does Huntsville position itself for its ongoing advancement, growth, development, so that we're not in the backseat waiting to just be led somewhere.
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