Someday, the promise of so-called smart-grid technology will revolutionize how we use electricity.
In fact, it is difficult to believe, in this age of technological innovation, that most electrical grids are still based on technology developed way back in the 20th century.
But as Xcel Energy has found, creating the new smart grids isn’t as simple as throwing a switch — not by a long shot.
The utility’s Boulder smart-grid experiment, which it calls SmartGridCity, will cost Xcel three times as much as first thought, and we’re concerned about the company’s desire to pass the overruns on to ratepayers.
Xcel has the consent of the Governor’s Energy Office and the staff at the Public Utilities Commission to pass on the full $45 million cost of the pricier-than-anticipated project to ratepayers. But PUC commissioners must make the final ruling.
Interestingly, Boulder has dropped its support of passing on the full cost to ratepayers, due to division among City Council members.
The PUC’s commissioners haven’t yet ruled on the matter, and we urge them to find a middle ground.
We join critics in questioning whether Xcel’s private investors ought to shoulder some of the costs of the overruns.
The experiment has been an expensive lesson. Xcel executives say they won’t repeat or expand the full SmartGridCity concept to other areas. The pilot program is meant, in part, to manage electricity by giving customers detailed information about their individual electrical use.
Beyond the cost benefits that can empower consumers to spot wasteful use, the smart-grid helps Xcel avoid voltage surges, route around blackouts and pinpoint maintenance issues.
The promise of a smart grid is that power can be used much more efficiently, which translates into less electrical generation. Because most of Colorado’s energy still comes from burning coal, any savings reduces greenhouse gas emissions.
But the fiber-optic cable strung to 23,000 homes, along with software, drove up the price.
Meanwhile privacy advocates have raised legitimate questions about how individualized information can be protected from those seeking to exploit it.
We hope PUC commissioners carefully consider the advice of consumer advocates at the Office of Consumer Counsel. The office recommends that ratepayers cover $27.9 million of the project’s price tag, which was last year’s revised estimate.
From there, commissioners should realize Xcel investors also have skin in this game.
