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Colorado Springs Utilities predicts failure on conservation goal

August 17, 2016 Updated: August 24, 2016 at 2:34 pm
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Colorado Springs Utilities won't meet its five-year goal to slash energy demand by 12 percent, a conservation threshold that's critical for closure of the coal-fired Martin Drake Power Plant.

The bad news about "demand-side management" emerged after a rosy presentation Wednesday by Kenny Romero, Utilities' manager of demand side management and renewable energy solutions.

"Why are we not trying to meet the goal?" asked Utilities Board member Keith King, who had pushed through the 12 percent DSM goal in November, up from a 10 percent reduction originally sought.

Said Romero, citing a study by Cadmus consultants: "With all our programs, you still don't get quite get to 12 percent. We would have to look deeper into other avenues outside the study results and existing program."

"Then that's what you should do," King said. "We should be more aggressive instead of giving up."

Board Chairman Andres Pico noted that Utilities' plan put a 2 percent cap on added costs for DSM.

"In 2018, we'd be very close to the 2 percent bill cap," said Utilities President and CEO Jerry Forte, "with probably about $24 million to be spent in '19 and '20 to meet that goal.

"If you want to raise the 2 percent, it will create rate pressure," Forte continued. "The goal is the cap."

"No," Pico said, "the goal is 12 percent within the cap. These are decisions we're going to have to have."

Even before the board meeting, observers were lamenting the news from Utilities.

"It makes me really angry that they're not trying. They gave up on this in April or May," said Jacquie Ostrom, who spent a year on Utilities' Customer Advisory Group to help devise the five-year Electric Integrated Resource Plan.

"We should sell CSU to Xcel," Ostrom said. "They have lower residential rates and 30 percent renewable (energy sources)."

Local conservationist Lee Milner said the DSM goal is directly linked to Utilities' ability to close Drake Units 6 and 7, a move set for 2035.

"Conservation is the low-hanging fruit," Milner said, offering Utilities the easiest, least expensive way to cut energy consumption and thus eradicate the need to add costly resources.

While clean-air proponents have pushed to end Drake's coal burning, so have Utilities officials who recognize the impending arrival of stronger federal emissions rules.

"The carbon cap is coming. It's not a matter of if, it's when," said John Romero, general manager of Utilities acquisition, engineering and planning, in June 2015.

While Kenny Romero on Wednesday cited energy efficiencies such as use of LED lights, smart thermostats and rebates, his presentation didn't mention C-PACE, the state's Commercial Property Assessed Clean Energy Program.

C-PACE helps commercial and industrial customers finance building improvements that increase energy efficiency, renewable energy and water conservation.

The owners can take up to 20 years to repay the low-interest financing through voluntary property tax assessments levied by their county.

Because energy savings usually exceed the annual payment, the owners can make intensive upgrades while helping to increase renewable energy and reduce greenhouse gas emissions, the state reports.

Downtown businessman and former Vice Mayor Richard Skorman said he retrofitted 225 light bulbs with LED lights for $10,000 but saved $12,000 over the ensuing 16 months on lights that could last 12 years.

"You need to be proactive as a utility," Skorman said. "I always thought they should do their own financing for business owners who are good ones. Just offering rebates isn't the answer. It is expensive. They need to think outside the box.

"Eventually, it gives ratepayers savings, and all that money goes back to families. We could really help to not have to build more (energy) generation. As conservative as we are in this community, a lot of it is conservation, not wasting."

King and Pico asked what more could be done to further the DSM goal, and Forte and Kenny Romero promised to bring the board more information.

Meanwhile, Utilities' "financial metrics are very strong, above expectations overall," reported Chief Financial Officer Bill Cherrier, "Financially, we're in really good shape."

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