Peter Lilienthal: Cost is key factor in judging muniPublished on: Friday, September 15, 2017
As the creator of NREL’s HOMER software, which has become the de-facto global standard for evaluating the practicality of local power, I’m often asked whether I support the city of Boulder purchasing Xcel’s distribution assets. The simple answer is that I can’t know until we know what the price will be. I’m shocked at how strongly people express their support or opposition without knowing what the price will be.
There is nothing shocking, however, about Xcel’s opposition. This is not because they are evil. They are merely running a business and responding to the incentives created by our regulatory system. That regulatory system penalizes them for losing load. This is not just a disincentive to letting communities manage their own power, it is also a disincentive to consumers becoming more energy-efficient or providing some of their own power through distributed solar and combined heat and power. Although the Public Utilities Commission has programs that partially overcome some of these disincentives, the regulators have a very difficult job mediating the competing interests, so regulatory change is contentious and time consuming.
These kinds of controversial issues are more manageable at the local level, so Boulder has the potential to move much more quickly to find ways to take advantage of the huge improvements underway in distributed power, storage, and demand response. We are convening hundreds of the world’s leading experts on local power at the fifth annual HOMER International Microgrid Conference in Denver on Sept. 18-19 (www.microgridconference.com). Space is still available to people interested in learning about the state of the art in local power from speakers from every continent.
This Letter to the Editor originally appeared in the Daily Camera.