Opinion: Xcel`s ‘pricing challenge` is challenging indeed


In the last weeks, many of us received robo-calls from Xcel promoting their “Pricing Challenge,” a by-product of the SmartGridCity. This two-phase program is an attempt by Xcel to determine the effects of higher pricing during times of peak electricity use. It will cost $1.5 to $2 million, and be paid for by Xcel customers. It is being promoted through an expensive mailer, whose beautiful design is unfortunately missing important pieces of information.
This is not the first time that Xcel has studied time-of-use (TOU) rates, and such rates have been used by other utilities for decades. Unfortunately, it is not clear exactly what new information Xcel expects to gather.
I was curious whether people who have photo-voltaic systems could participate in this Challenge, so I asked my friend Ken Regelson, a sustainable energy consultant. Regelson had already called Xcel. “After about 20 phone menus and talking to two people, I did talk to an informed phone rep. According to her, customers with PV cannot participate in the Pricing Challenge. The phone rep was not clear on why solar owners need not apply and was quick to agree that a kilowatt-hour (kWh) generated is equivalent to a kWh saved or shifted, and that she didn`t make the rules but would be happy to pass on my concerns.” Also, per my own inquiry, customers who have already committed to conservation with Saver Switches (Xcel-controlled switches that cut off certain loads during peak times) are excluded.
So how will customers determine how much electricity they use at various times during the day so as to be able to evaluate the potential benefits (or costs) of the various Pricing Challenge schemes? I checked Xcel`s Web site to see whether their SmartGridCity data would allow me to see how much I used during Xcel`s “red light” peak period of 2 p.m. to 8 p.m. Since I have a “smart meter” (really just a remote-read meter), the data is there, even if not available in real-time. But to analyze it would require hand tabulating the numbers individually for every 15 minute interval for every day, as I could find no way to either integrate the data on site or download it to a spreadsheet.
Unfortunately, the mailer lists rates for the Pricing Challenge schemes but not the ordinary rates. So doing a comparison requires adding up the six digit decimals on my bill to determine the current rates.
Regelson`s perspective was interesting. “I think a residential customer just doesn`t use enough per day to make it worthwhile to pay attention. For the average residential user, even if you were to shift ALL of your energy use out of the “red light” times, your savings would be less than 50 cents per day under options 1 and 2, but the cost to you if you used much electricity during red light times could be high indeed.”
Under option 3, for system “Peak Energy Events,” you get paid to reduce below your average use level, defined as “the average of your electricity use during your five highest peak period times from the previous 10 weekdays.” If some of these were “Peak Energy Events” for which you already cut use, your average is apparently reduced, and then so is your next rebate, unfortunately for you. Challenging enough?
Boulder has by far the highest Windsource participation rate in Xcel`s Colorado territory, and the Pricing Challenge only applies to Boulder SmartGridCity customers. But I couldn`t find any information on Windsource in the mailer. According to the Xcel rep I talked to, the Windsource premium is added on to all Challenge prices, but the effect on rebates is unclear.
The mailer asserts that participation in the Pricing Challenge can help “reduce our impact on the environment.” This didn`t sound right, as I know that peak demand (which Pricing Challenge addresses) is met by natural gas turbines, not coal-fired boilers, so I checked with Regelson. “If you actually reduce your total usage and aren`t simply shifting it to other times, then there is a marginal reduction in emissions – less gas is burned. But if you are simply shifting load from peak to off-peak, then you are shifting from gas to coal, and actually increasing local pollutants and toxic metal emissions as well as CO2 and other greenhouse gases.”
The Pricing Challenge simply did not get the critical review it deserved, and we will pay for that.


Popular Posts

Opinion: Opportunity for the new Boulder City Council

Congratulations to the four new Boulder City Council members! You have a great opportunity to make a contribution to the Boulder community, but it will take a lot of work to do it responsibly; the learning curve is pretty steep. Here are some suggestions for you (and other Council members) that may help improve the process. Read the Charter. It is the document that governs how you, city staff, and board and commission members operate, and how you relate to each other. It defines the limits of your and their power, and can only be amended by a citizen vote. You don’t have to remember every word. But just knowing what’s there makes you more self reliant and less at the mercy of others’ opinions. For example, relative to the recent meeting discussion over diversity, the council does  not  have the power to suspend the rules as to when the mayor is selected. Charter Section 14 specifies, “The mayor shall be chosen by the council from its own number, upon the convening of t...
Read more

Opinion: Is this the end of Boulder as we know it?

Much of what has made Boulder such a great place to live has been the work of people half a century ago. These people recognized what I call the “ ratchet effect ,” that bad development decisions cannot be undone, so policies needed to be put in place to prevent, or at least limit, the damage that a growth-at-all-costs majority of the council could do. These policies include charter limits, like the Blue Line that prevents city water for development from being supplied above a certain altitude, the 55-foot height limit that has prevented high-rise development from cutting off our views, and the open space referendum process that allows a 60-day window for citizens to challenge disposals of open space. Other constraints include the Boulder Valley Comprehensive Plan’s requirement for Planning Board agreement for land-use changes in the area inside the city limits (Area I) and additional agreement by the county commissioners and county Planning Commission for urban development further...
Read more

Policy Documents: Impact Fees and Adequate Public Facilities

I am writing this to correct some of the apparent inaccuracies put forward at the 10/14 CC/PB study session about charging growth for its costs. I do not claim to be an expert in the field, but I have studied it long enough and consulted with enough supposed experts and legal types to understand most of the basics. In addition, I have found that the experts don’t necessarily know everything and won’t necessarily put forward the most appropriate solutions. The fundamental rule, both legal and equitable, is that growth should pay to address its impacts so as to maintain existing levels of service (LOS) for existing residents and businesses. But growth cannot be required to improve levels of service. LOS is measured in all sorts of ways depending on the facility and/or service being measured. For transportation, it could be total VMT, travel time, intersection waits, access to transit, etc. For schools, it might be square footage per pupil, etc. For water, it could be water righ...
Read more