Austin Energy key in race for mayor

AUSTIN (KXAN/LBJ/CLASS) - Austinites enjoy some of the lowest electricity rates in Texas from what is known as one of the most progressive and sustainable utilities in the country: Austin Energy.

And now, Austin Energy is trying to accomplish something no utility has ever done: Carbon neutrality.

The next City Council will make important decisions about Austin Energy’s new-generation investments that will change the way the utility operates and how citizens consume their power. This summer, Austin Energy will present to the council their recommendations for their long-term generation plans. The council and the new mayor will have a great impact on the future of Austin Energy and the future of the city’s energy use.

Are Austinites prepared for the drastic changes associated with a carbon-neutral Austin Energy? Already, locals have been skeptical about some of the more expensive proposals that have come on the table, such as the biomass plant and the Weberville Solar Project.

For many years, Austin Energy has been a national leader in demand-side management (DSM) programs designed to encourage consumers to modify their electricity use and wind energy investment through its GreenChoice® program, and the installation of new smart meters. The Austin Climate Protection Plan (ACPP), passed by City Council in 2007, established a number of new goals for the city-owned utility, including requirements for carbon neutrality on any new-generation, dramatic increases in energy conservation and efficiency.

The ACPP has challenged the utility to change the way it operates and lead the nation in greenhouse gas emission reductions.

Austin Energy emits the most carbon dioxide of any city activity. Austin Energy produces about 1/3 of its energy from coal combustion, while this activity produces about 71% of the utility’s total carbon dioxide emissions. In order to become a carbon-neutral utility, Austin Energy must purchase carbon offsets for their emissions from coal combustion, or pay for new carbon-neutral or renewable-generation sources.

Since the approval of the ACPP, Austin has explored a diversified range of generation options.

In 2008, the City Council unanimously approved a $2.3 billion contract to purchase all power produced over a 20-year period by a 100-megawatt (MW) wood-waste-fueled biomass plant in East Texas. While this new source of power helps meet Austin Energy’s renewable energy goals, there were numerous complaints about the proposal’s lack of community discussion.

In September 2008, Austin Energy announced an 8-month community-wide public participation process to solicit feedback on future power-generation options for the utility. Austin Energy developed a resource guide for the public that provides the pros and cons of each generation type and revealed a proposal for new generation between now and 2020. The resource guide and proposal for new generation were discussed at five community-wide town hall meetings and on the utility’s web site, austinsmartenergy.com, where Austinites can post questions and provide input on the proposed generation plan.

Austin Energy plans to send their final recommendations on the proposed generation plan to City Council by early summer of 2009.

In the meantime, Austin Energy took action on two investment options.

The utility had considered investment in the expansion of the South Texas Project, a nuclear facility in Matagorda County. In February, the utility announced it would not participate in the proposed expansion, though not ruling out nuclear energy in principle.

Then on March 5, 2009, Council approved (7-0) a $250 million agreement under which Austin Energy will purchase all electricity produced over a 25-year period by a 30 MW solar project to be built on city-owned property near Webberville. This project is one of the country’s largest solar power facilities and helps diversify Austin Energy’s renewable portfolio, which is currently 99% wind-generated power.

The unanimously approved project has received much public criticism about the facility’s use of foreign-made panels and San Francisco-based design company, not to mention fears that the solar investment will raise Austinites’ utility rates. Power produced from the solar project will likely be sold in a program similar to Austin Energy’s GreenChoice® program for wind energy, where customers voluntarily subscribe to a flat charge for electricity use over a set period of time in place of a fuel charge.

Katy Cummins is a graduate student at The University of Texas at Austin's LBJ School of Public Affairs, specializing in Urban and State Affairs, with a focus on energy and transportation issues. She is part of the CLASS program at LBJ. She can be reached by email at katy.cummins@gmail.com.