GRU Authority gives Bielarski a 3% raise, discusses future of its generating units

BY JENNIFER CABRERA

GAINESVILLE, Fla. – At the October 8 GRU Authority meeting, the board gave CEO Ed Bielarski a 3% raise, heard information about the future of its generating units, and approved agreements to provide services to the City of Gainesville.

Bielarski’s evaluation

During Chair Comments, Chair Eric Lawson thanked the board members for completing an evaluation of Bielarski, and Chief People Officer Cheryl McBride summarized the evaluations and comments. She provided the following average ratings on a 5-point scale, along with selected comments:

• Mission and values: 4.5 – Directors commented that Bielarski has a clear alignment with GRU’s mission to provide safe, reliable, cost-effective, and environmentally-friendly energy, and a “number of key accomplishments” were cited.
• Communicates with impact: 4.75 – Directors wrote that Bielarski has “exceptional strength in communication, supported by deep institutional knowledge and a long-standing history with GRU”; one director wrote that Bielarski’s responses to public issues, particularly on social media, are “generally appropriate,” and one director noted “concern about the tone of the personal social media posts.”
• Lead and develop others: 4.25 – Directors wrote that he actively fosters talent development by involving subordinates in board presentations and encouraging their growth, and his strategic recruitment of key personnel has enhanced GRU’s capabilities.
• Achieved success through change: 4.75 – Directors wrote that he’s implemented a series of changes that have significantly improved GRU’s operational and financial health. Directors specifically noted the hiring of the Chief People Officer to revamp Human Resources exclusively for GRU and the hiring of a GRU-focused attorney. There have been reductions in vacancy rates, back to pre-pandemic rates. Bielarki also “eliminated unfavorable legacy commitments, such as the TEA agreement.”
• Drive execution and financial results: 5.0 – McBride said Directors wrote that Bielarski’s “clear and effective debt repayment strategy has contributed to stabilize bond ratings, and notably, these results were accomplished without raising electric rates.”
• Service and quality excellence: [no score given] – McBride said Directors commented that GRU has earned FMEA’s Reliability Award, “a testament to the organization’s operational strength — and while we have some service delays that persist, complaints are addressed promptly. His commitment to affordability is reflected in the rate freeze that we have in place, and his customer-first approach continues to guide GRU’s performance and priorities.”
• Overall performance: 4.5 – McBride said Directors wrote that Bielarski “has successfully implemented the strategic vision, yielding positive outcomes in debt reduction and cost-effective improvements across GRU. He’s recognized as a valuable asset to the Authority and demonstrates strong leadership and transparency in the organization. His management of the utility has been commendable.”

Lawson said, “Working with Ed over the last year has been phenomenal… He’s executed on multiple prongs, I think.”

Director David Haslam said, “The thing about feeling he’s a little strong on social media: He gets attacked [at Authority meetings], personally — there’s always at least one or two people that say horrible stuff that isn’t true and out of context. And then, also, he’s getting attacked, even on his personal social media,… saying things that are just obscene. You know that he’s got to respond to this stuff, [and] he’s the only real advocate that we have to set the record straight, because there’s so much — I know the word is ‘misinformation,’ but there’s so many lies out there,… and he’s got to set that stuff straight.” 

Haslam said some people may think Bielarski “brings it upon himself, [but] no, he’s doing his job. He’s doing it good. So I think the tone is necessary, most times, personally.”

Director Jack Jacobs said he had encouraged Bielarski to make more statements through the Public Information Officer “because some people are not going to believe anything he says — because it’s coming from Ed Bielarski… But maybe involve somebody to help him out with social media [so we can]… communicate with the public without people attacking him personally.”

Director Chip Skinner agreed and added, “Ed, a lot of people think that you have sour grapes. I commend you for working with [the City], no matter how much they attack you and come after you… You have stayed the course… I know there’s a couple out there that, I agree with you, they are difficult to work with and listen to,… because most of it is misinformation, or borderline full-blown lies.”

Bielarski’s August 2024 contract set his salary at $332,061 per year.

Lawson said the merit increase for other GRU employees this year was 3% and asked for a motion on a merit increase for Bielarski. He said every organization looks at market values for their job positions, and he thought that next year, the Authority should ask McBride to evaluate the salary of the CEO position. He added, “I don’t think now is the right time, because of all that’s going on with House Bill 1645 and all those issues.” He said any raise should be retroactive to June.

Haslam said people already say Bielarski is the highest-paid City employee in Gainesville, “and whether that’s true or not, he’s also the only City employee that actually generates revenue.”

Lawson said Bielarski’s salary should be compared with other utility CEOs, as opposed to municipal government employees.

Jacobs said he was not opposed to giving Bielarski “something commensurate with the cost of living,” but he thought the board should look at his salary again once the governance of GRU is settled.

Skinner said he thought 3% would be a reasonable increase, “knowing we’re going to get beat up, Ed is going to get beat up, but… if it wasn’t for Ed being transparent and answering our questions,… we would never get the information to be functional.”

In response to a question from Jacobs, McBride said all GRU employees who scored 3 (out of 5) or higher on their evaluations received pay increases this year, drawing from a pool of money budgeted at 3% higher than last year.

Haslam made a motion to increase Bielarski’s salary by 3%, and Skinner seconded the motion. McBride asked Haslam to modify the motion to make the raise retroactive to Bielarski’s anniversary date, and Haslam agreed. The motion passed unanimously.

Natural gas supply agreement

The board unanimously passed a resolution to approve a natural gas supply agreement with the Municipal Gas Authority of Georgia and TD Bank. The agreement will save an estimated $0.32 /MMBtu and is projected to save about $645,000 per year. 

Lawsuit update

During Attorney Comments, Scott Walker praised the hiring of Utility Attorney Derek Perry and provided updates on the various lawsuits. He said the Authority has filed “a more traditional motion for injunctive relief” in an effort to enjoin the City of Gainesville from holding a Special Election on November 4 on the governance of GRU or, if the election is held and the referendum is approved by voters, prohibiting the City from taking over the governance of GRU until the case is resolved on the merits. Walker said a hearing on the motion may be held on October 29. 

Regarding the original lawsuit on the first referendum on GRU governance, Walker said the Authority has given the City an extension until November 4 to file their initial brief in their cross-appeal to the ruling that gave each party part, but not all, of what they wanted. Walker said that after the City’s brief is filed, the Authority will file its briefs, and then the 1st District Court of Appeal may order oral argument.

Servise Level Agreement to provide IT services to the City

The first business discussion item was a Service Level Agreement (SLA) with the City to provide IT services for $3,703,577.70 for one year. Bielarski said that’s lower than the amount previously paid by the City “because they’re taking over some of the responsibilities that we now have”; the City is in the process of setting up its own IT department.

Lawson said both sides win because the City doesn’t have to “go out and invest in the infrastructure,” and GRU wins “because we can cost-share a percentage of our fixed cost with the City.”

Bielarski said the agreement is for one year because the City’s in-house IT capabilities are changing.

Jacobs made a motion to approve the SLA, and Haslam seconded the motion. The motion passed unanimously.

Agreement to continue billing solid waste and stormwater fees for the City

The second business discussion item was an agreement between GRU and the City for solid waste (trash pick-up) and stormwater fee billing services for $952,000 in FY2026 ($130,000 more than the current agreement), with the City paying GRU a fee of 4% of revenues collected instead of the current flat fee.

The Authority previously voted in March to move toward removing those items from GRU bills, and Bielarski said he understood the desire to reduce the overall amount of customers’ utility bills by removing those items, but the City said it would cost them more to bill those fees through another entity, so they were willing to pay a higher fee if GRU would agree to continue billing them. 

Lawson said that removing these fees would not make a “dramatic” change for customers, and he was concerned about losing the $952,000 in revenue. Haslam said, “I think that we should work with the City in every way that we can, that is beneficial for both parties without one party being… taken advantage of.”

Jacobs said he was “a hard no” on the agreement: “It’s not optics; it’s principle… They give us a little bit of a, say, bribe, to take over the services, and we leave them unchecked authority to raise stormwater and garbage fees whenever they’re in a bind. The Commission has already proven that they cannot be trusted with the money.” He said that forcing the City to bill them separately (or on property tax bills) would “put the onus back on the City Commission to act responsibly.”

Skinner said he appreciated that perspective, “but I think this is a win-win,… and we can always do a PR campaign if bills are going up… and say, ‘This was a decision… done by the City Commission.'”

Haslam said Jacobs had “a very valid point” that “got me thinking a little” because “it’s impossible for us to get the truth out there.” He said, however, that if someone made a motion, he would probably second it.

Skinner made a motion to approve the agreement for a two-year period and re-evaluate it next year, and Haslam seconded the motion.

The motion passed 3-1, with Jacobs in dissent.

Integrated Resource Plan update

The third business discussion item was an update on the Integrated Resource Plan (IRP); Bielarski said he wanted “to kind of firm up what action we’re taking, because, again, there’s a lot of things that are out there in the public — either that we’re not following the IRP or the IRP is dead in the water.”

Bielarski said most of the concern is about units that are nearing their “paper retirement dates,” which are 2027 for Deerhaven 1 (DH1) and 2031 for Deerhaven 2 (DH2), Combustion Turbine 1 (CT1), and Combustion Turbine 2 (CT2), totaling over half the utility’s generation capacity. He pointed to the Kelly unit’s retirement date of 2051 and said it was originally scheduled to be retired in 2021, but the utility did a rebuild for $26.6 million and added 30 years of life to the plant. He said DH2 was retrofitted in 2021 to run on either bituminous coal (a typographical error in the chart) or natural gas, which should extend the life of the unit because natural gas is less abrasive.

The 2023/24 IRP Scorecard had six takeaways:

• Extend DH2’s paper retirement to 2036
• Extend CT1 and CT2’s paper retirement to 2031
• Explore short-term capacity PPAs
• Startup of Sand Bluff Solar PPA (2025)
• Replace DH1 with gas-fired unit (2028)
• Startup of another Solar PPA (2029)

Bielarski said extending the retirement of DH2 to 2036 “gave us the best bang for the buck [and]… we’re looking at that.” He said GRU is also looking at extending the retirement dates for CT1 and CT2 and exploring short-term capacity Power Purchase Agreements (PPAs): “In fact, we’ve had a four-month Power Purchase Agreement with FP&L that helped us over the hump when we were having some problems with Kelly… It was lower than our own cost of production.”

The Sand Bluff Solar PPA was mutually terminated because the price “became too prohibitive”; GRU has not committed to replacing DH1 with a gas-fired unit, “and we’re looking at other alternatives.” 

Regarding solar projects, Bielarski said, “Solar isn’t free.” The Sand Bluff project started at $47/MWh and then increased to $55/MWh, while GRU’s internal cost of producing energy is $38/MWH. The cost in the 2023/24 IRP for the 2029 Solar PPA was $40/MWh, and right now it’s $51-$53/MWh with a 2% escalation, “so it changes the very economics of what we’re looking for.” However, he said GRU is still monitoring opportunities for solar PPAs.

Additional options include extending DH1’s retirement date to 2032, although the costs have not yet been determined. Bielarski said that when the IRP was written, a 72 MW RICE engine cost about $116 million, and now that would be about $193 million, while extending DH1’s life could be as low as $13 million. 

Bielarski continued, “So what you need to understand about this is, it doesn’t give you a new plant, it doesn’t give you 30 or 40 years, but it moves the decision-making process out five years, to a time when you’re not in the middle of skyrocketing turbine prices, generator prices, because of the boom in AI data centers, because you have Amazon, Google, they’re buying their own and trying to capture that part of the market, and we’re competing with all of that.”

Bielarski said that extending the life of the units “buys us time to thoughtfully think through” the future of GRU’s generating assets and “make the best of your assets… I see the next period of time as being one to put us on strong financial footing.”

Lawson said the IRP’s recommendations “don’t really consider the debt load that GRU currently carries, and those have to be factored in.”

GRU Review

In a quick GRU Review, Bielarski said all Human Resources services are handled in-house, effective October 1, and GRU is $13 million ahead of budget through August in all systems.