All the department heads and experts urging Leesburg city commissioners this week to approve a $27 million smart-grid project spent considerable time pussyfooting around a key piece of the proposed upgrade to the city’s electric utility.
Here’s what a couple of them said (Hint: Look for weasel words:
Doug Handley, Utility Consulting Services: «Rate structures will encourage residential users to reduce their demand. A key step is the dynamic pricing structure. «
-
-
E-mail |
Recent columns
-
Leesburg
Electricity Production and Distribution
Government
- See more topics »
Paul Kalv, city electric director: «Seventy-five percent of the benefits come from reduced demand charges. This puts the customers in control of their own bill.»
Smart grid was portrayed as a wonderful opportunity for electric customers to reduce their bill through a variety of options, and commissioners approved it unanimously. Kalv remarked that electricity is one of the only commodities that people buy without knowing the cost. Smart grid will allow people to know what they’re spending as they spend it. The project is supposed to break even in the sixth year.
Resident and electric customer Don Lukich came to the microphone and said, «One thing stands out: The city is taking on debt. What is that going to do to my rate over the next six years?»
Here was the answer, from Handley:
«All costs have to be considered in the structure. Negative cash flows don’t have to occur through the reshaping of debt. Debt services can be refinanced so there are no negative years of cash flow. All of this is built on projections of revenue requirements. Everybody who participates in the program and is able to take advantage of dynamic pricing will have the opportunity to reduce their costs.»
Then City Manager Jay Evans launched into an explanation of how the city hopes to «shape the debt service» so that payments are larger toward the end of the life of the loan to «match benefits and costs.»
Lukich’s response? «Nobody is answering my question. You’re talking in circles.»
He was right.
That brief encounter of a couple minutes during a commission meeting is a microcosm of what Leesburg should expect from its 22,000 customers who will be getting smart meters starting next year and who suddenly will be thrust into the world of electric rates that vary dramatically based on the time they choose to use electricity.
Unfortunately, the city has chosen to spend only $10 for each household to educate people on how to use smart grid, if not to their advantage, then at least to prevent a family from being overwhelmed by huge electric bills. Hopefully, they’ll be «encouraged» to cut back on electric use by sky-high rates.
The truth is that customers who continue to use electricity the way they do today will be paying immeasurably higher bills. How much? That’s impossible to say until the city sets its new rate structure. City officials should have answered Lukich’s question with honesty and simplicity, not smart-grid gobbledegook.
City officials continue to talk about the «success» of the project in terms of whether they can get the attention of enough customers and persuade them to use electricity at odd hours rather than peak times, when other customers also are using juice.
From the viewpoint of the customer, that’s accurate. From the viewpoint of the city, there’s no such thing as «success.» This is a no-lose deal for the city and in fact could be an incredible money-maker. Perhaps that’s why the city proposal calls for so little spending on education.
Here’s a short primer on the financial reality: Leesburg has an electric utility for one purpose and one only, and that is to make money.
Last year, nearly half of the money to run the usual city services such as police and fire came from utility profits. And the biggest contributor is the city’s electric utility, which this year is throwing just under $6 million into the pot, thanks to electric customers — some in the county and in Fruitland Park — paying through the nose.
(Consider that electric rates could be reduced markedly this minute if Leesburg, like nearly every other city in the county, limited its spending to what it collected in property taxes and other fees rather than skimming profit from electric ratepayers.
If enough customers were to embrace smart grid that the city could reduce electric demand — and thereby the cost — during peak times, the price that the city pays for electric would come down. But would the cost to the customer actually drop?
That’s an excellent question no one bothered to either ask or answer. The city is predicting that its cost of buying electricity will rise by 47 percent between now and 2013. So perhaps the only reward for those who participate enthusiastically in smart grid and reduce their electric consumption will be a flat bill. No one knows.
If customers decide smart grid is just another annoying government program and they don’t want to do laundry at midnight, Leesburg will be a huge winner. That’s because the cost of electric for people who don’t bother to change their consumption habits will skyrocket. They’ll be gobbling electric during peak times, just as they do now, only the rates will be monstrously higher.
Kalv, in a melodramatic plea, said of smart grid, «Without this, we’re going to be lost. With this, we have a chance.»
Oh, dear. Apply a cold compress. Leesburg can count on the cash continuing to roll in from the pockets of electric customers, regardless of whether smart grid is a «success» or «failure.»
Lritchie@tribune.com Her blog is online at http://www.orlandosentinel.com/laurenonlake.
Читать полностью или написать коммент.. Про установку спутниковых тарелок в Московской областиhttp://tarelka-tv.ru/
Комментариев нет:
Отправить комментарий