This is the second part of a series on the electric grid.
BOULDER, Colo. -- "Next year will be interesting," explained Matt Appelbaum, the mayor of this college town, which is trying to help launch the largest ongoing 'smart grid' project in the United States.
It will be a year in which the town's lanky mayor -- assuming he is re-elected next month -- and the rest of the City Council will grapple with some of the toughest questions posed by an ambitious, $100 million pilot rewiring project being prepared by their local utility, Xcel Energy.
The experiment will have national implications because it is intended to demonstrate how consumers can use a more sophisticated and agile electric power grid to substantially reduce the nation's greenhouse gas emissions and, perhaps, their energy costs.
While the so-called 'smart' grid tends to provoke talk about exotic technology, a lot of the question marks around this project have to do with something more complicated: human behavior.
One nagging question is who will pay for this expensive project, a subject of growing concern among this city's large cadre of energy and environment experts. Then there is the issue of how the smart grid will reach the Boulder's commercial sector, which generates 58 percent of the city's emissions.
Many businesses rent their properties here and don't have meters, which leaves them -- like most Americans -- almost clueless about how much electricity they use and what it's used for.
Another puzzle: How do you incentivize people to change their behavior? Some of the experts here know their homes waste energy, but haven't gotten around to doing something about it. Then there is a big symbolic issue standing in Boulder. The city's vociferous environmental activists insist the first thing Xcel must do is to shut down Boulder's coal-fired power plant -- a step the utility says it won't take because it is one of its more efficient power plants.
Weighing the 'Big Brother' factor
Finally, there is the "Big Brother" factor. Some people here think Xcel, the main sponsor of what it calls the "SmartGridCity" project, will use the grid's new two-way wiring to learn more than it should about peoples' energy uses.
Appelbaum, a semi-retired former computer software architect, describes himself as a "policy wonk." He finds raising campaign money and running for office somewhat tedious, but he loves dealing with tough, novel questions. Boulder, he explained, "takes on issues that other people don't."
While Boulder has many wealthy residents, the projected $100 million cost of the new wiring, "smart meters" and other sophisticated gear being installed for the pilot project is a big number for most people to swallow. It works out to about $10,000 for each resident. In its pioneering haste to put together the nation's first sizable smart grid project, Xcel neglected to qualify for the Department of Energy's economic stimulus package, which is preparing to devote $1.5 billion to start several regional smart grid projects around the United States, but not this one.
Xcel, which is contributing $20 million to the project, says it will leverage more money from its seven partners in the project, many of them equipment and software vendors who see big future markets in smart grid. The utility is also trying to qualify for a second round of DOE stimulus funds and is applying to the Colorado Public Utilities Commission to put some of the costs in the electricity rate base. That means Boulderites could find some of the costs tucked in their electric bills.
Xcel's local spokesman, Tom Henley, said the utility's next step is to offer free smart grid connections and equipment to a few hundred volunteers, but insists the company never said the whole $100 million project would be free.
Steve Pomerance, a former city council member, asserts that the smart grid was presented to the current city council as "a pig in a poke. Xcel presented that the citizens of Boulder wouldn't have to pay for it; now they're asking them to pay for it."
Attacking the local coal-fired plant
"They're trying to do this on the cheap," grumbled Alison Burchell, a geologist. She insisted that the first step the City Council must take is to "put Boulder on the path of rapid decarbonization" by prodding Xcel to shut down its local coal-fired power plant here or modify it to burn something else. Both Burchell and Pomerance are among the organizers of the Boulder Climate Action Network, which is also lobbying the council to push Xcel to extend the smart grid experiment to retail stores and other commercial businesses.
The group bristles with scientists, lawyers and energy experts. One member, Leslie Glustrom, a biochemist, said she is spending 50 to 60 hours a week burrowing through the records of the state's Public Utilities Commission for records of Xcel's dealings with Boulder. She recently sued Xcel to stop the utility from recovering the costs of a new coal-fired facility in the region. "We don't lack for expertise here," explained Pomerance.
Appelbaum supports smart grid, but admitted that the political feeling in Boulder is that Xcel's launch of the project has been "less aggressive and much slower than we'd hoped for, for a whole variety of reasons." One reason is the money problem. Another is an inability to push the project into the business community. Here, he thinks the council can do something by changing local laws to provide for so-called "green leases."
The leases would require landlords to allocate their electricity costs as part of the rent, so both the businesses that rent and their landlords will have incentives to lower their energy costs. Boulder has already changed its building codes to require that meters be installed on new rental properties and on renovations.
Regulating the unregulated
But most of the University of Colorado's 20,000 students and many of the city's poorer residents will remain meterless, because they tend to live in older rental apartment buildings. They don't fall under the building code changes as long as they're not remodeled. "That's the problem, and you have to be very careful about finding the solution," the mayor explained. "It's all on the council's agenda for next year."
Boulder is among the American cities that support the Kyoto Protocol, which calls for industrial nations to cut their greenhouse gas emissions by 5.2 percent over 1990 levels. In 2006, Boulderites took a step further. They voted to impose a carbon tax on themselves to support the treaty's goals, but like many American cities, Boulder's carbon emissions have continued going up. Building larger houses and clogging the streets with more traffic are increasing Boulder's emissions by 4 to 6 percent per year.
"Most nations of the world that signed Kyoto have found it difficult to make much of a dent in carbon emissions," sighed Don Mock, another former member of the city council, who has a degree in atmospheric physics. "Boulder is just a microcosm of that universe." Older houses in town, he explained, are either "popped," expanded by adding on a new story, or "scraped," bulldozed to make way for larger buildings, he explained.
Mock lives in a smaller, older home and buys electricity under a program that gives him 100 percent wind-generated power from Xcel. Recently, he applied for a home energy audit, a program subsidized by the the city with some of the $1.8 million it raises annually from the carbon tax. Technicians came with a blower that sucked air out of his front door, exposing a cavernous gap under his fireplace that lets in large drafts of cold air in the winter.
He says he's still thinking about ways to make his home more energy efficient. "I imagine 10 years from now, when my refrigerator bites the dust, I'll be able to buy one that's smart grid compatible."
Mobilizing '2 techs in a truck'
Delays in making energy efficiency improvements are another thing the City Council wants to fix. Mayor Appelbaum said it will follow up the house energy audits with a new program called "two techs in a truck." The city will help pay for two trained technicians who can make needed repairs right away and as inexpensively as possible. "We're trying to make this as easy as we possibly can."
Steve Bauhs is sales director for Simple Sales, one of a number of Boulder companies that sell and install solar power arrays. He's concerned about what Xcel might do with the data it gets from its customers, once they are connected to smart grid. The system will allow solar owners to sell extra power back to the utility at peak rates, he notes.
"Will Xcel go into the business of selling solar? It might give them an advantage of knowing who has solar and who might be the next prospects to buy it," he suggested.
Henley, the Xcel spokesman, said the utility has no plans to go into the solar array business. Moreover, he said, the company is working with software vendors to make sure the data it collects from consumers are protected from computer hackers and others who have no need to know.
But that doesn't satisfy an array of bloggers who have bombarded the local paper, the Boulder Daily Camera, with their concerns after every story about smart grid. One anonymous writer warned that the system will allow the FBI to see "who is using high watt lights for indoor (marijuana) gardens. Big brother is watching."
Others claim smart grid will allow Xcel to order "mandatory blackouts" and to turn off selected home appliances without the homeowner knowing about it. "Great," wrote one blogger, "now I can pay for this nifty new meter that will allow them to increase my bill. And, I am sure the Communist People's City Council will find a way to tax anyone that is not green enough."
Jolted by an $8,000 electric bill
And some bloggers would rather be left alone: "If you want to drive a Prius, use CFLs (compact fluorescent bulbs) in all your light sockets and heat your house with dried kitty litter, go ahead. But quit telling me how I should live my life."
"Blogs aren't reflective of the community as a whole," asserted Will Toor, who is a commissioner of surrounding Boulder County. Previously, he served as mayor of Boulder for seven years. "If they were, I'd have never been elected."
He was one of the authors of the 2006 climate tax that Boulder imposed on itself. Last year, he pointed out, 70 percent of Boulder County voters approved a "Clean Energy Finance District," a measure that allows the county to float bonds that raise $15 million a year to provide loans to homeowners who want to buy solar arrays or make their homes more energy efficient. The loans are repaid over 15 years through slightly higher property taxes.
Toor is waiting for Xcel's smart grid experiment, which is confined to the city of Boulder, to get bigger. If the utility gets permission to send consumers price signals that make electricity cheaper at night, "that's when it [smart grid] becomes really powerful." More solar users will sell electricity into the grid during the day, which makes their meters run backward, reducing their electric bills. More owners of plug-in vehicles will make use of the cheaper nighttime rates to fill their cars.
Annual surveys taken by the county show people are "very focused on climate action," he explained. Some voters worry most about climate change; others see the moves as reducing their electric bills. More conservative voters see the actions as a way to reduce the nation's energy dependence.
Toor, a physicist who formerly taught at the University of Colorado, acknowledged that the road ahead for smart grid enthusiasts won't always be smooth. The first month after he installed a 3.5-kilowatt solar array on his roof to drive down his home's electricity bill, he was shocked to receive an $8,000 electricity bill in the mail. It was because Xcel hadn't figured out how to adjust for a meter that was running backward. "They've since fixed that," he noted.
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