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Electrifying Developments 1

 

Relative to some of its utility industry brethren, Progress Energy Carolinas has a reputation as a good corporate citizen. So it came as a shock to many residents of its Western North Carolina service area when, in December 2006, PE and the Buncombe County Board of Commissioners made a surprise announcement. A deal had been struck to build a new ultra-low sulfur oil-fired peaking power plant in Woodfin, a small town north of Asheville. The stories below are an account of what happened next and the ongoing maneuverings over how to meet the electrical needs of an area beset by rampant high-end real estate development. In late January, 2008, WNC set a new one hour peak damand record at 985 MW, a level of demand not projected until 2011.

Commissioners Pass Greenhouse Gases, January, 2007
Covering The Cliffs, February, 2007
Won for Woodfin, April, 2007
The Second Act Begins: Progress Energy convenes CEAC, June 21, 2007
The Second Act: Part Deux, July 20, 2007
CEAC III: What Are We Doing Here? August 17, 2007
CEAC Proposes to Take Steps, October 12 & November 9, 2007
The Other Face of Progress, December 14, 2007
Sugar Time, January 11, 2008
CEAC Speaks, February 8, 2008
Maneuvering: CEAC IX, March 14, 2008

For reports from 4/08-2/09, see Electrifying Developments 2


Commissioners Pass Greenhouse Gases
The Indie, February 1, 2007

The Buncombe County Commission’s unanimous vote on January 16, 2007, to lease 78 acres of county property to Progress Energy for construction of a 130 megawatt peak power plant should be old news. I can’t add to the facts because I’m writing from the past: the night it happened. I’m here now to remind you of the outrage.

If you’ve been in a cave these past weeks, the lease price for the virgin land adjacent to the old county landfill in Woodfin was $1 per year. Commissioners hastened to tell the overflow crowd in attendance that they expect the deal to net the county an additional $300,000 in taxes. Early on there was a further claim of $200,000 savings in county lawnmowing expenses. Former landfill director and Progress deal booster, Bob Hunter, inadvertently debunked the mower windfall by saying the county had been required to set aside $12 million for maintenance in perpetuity of the landfill site.

Ken Maxwell of Progress Energy described the painstaking process of deciding on an ultra-low sulfur oil (diesel) plant as opposed to other options including conservation. He said the company could have announced the plant two years ago had such care not been taken with the deliberations. County Commission Chairman Nathan Ramsey confirmed the timeframe by saying the Commission had been talking to Progress for two years. Gadfly Jerry Rice asked why the public didn’t hear of the plan until December 2nd—six weeks before voting on the lease. Ramsey replied that public notification wasn’t required because there hadn’t been a quorum of commissioners present at any discussion. Take that, Sunshine.

Commissioners felt free to ask Maxwell sweetheart questions after his initial presentation. A bored-sounding Ramsey then soldiered through two hours of public hearing, during which commissioners were content to ask only the speaker’s name. Why, many opponents wanted to know, couldn’t the county delay the vote for 30 days and hear alternative proposals from community experts? Commissioners had to listen to people outside the chamber applaud such speeches.  The three members of the business community who rose in support of the lease deal were lonely voices in that wilderness.

After the public was duly heard, Commissioner Carol Peterson asked Maxwell to rebut. Ramsey agreed it was only fair after all the talk about global warming, dependence on foreign oil, asthma, poor land stewardship, a rush to vote without consulting even the county’s own environmental committee, and failure to consider demand side management. Maxwell responded to the 30-day postponement request by saying that tabling the lease decision would be bad because time is short. Multiple regulatory approvals are required, and the plant needs to be operational by December 2009.

The commissioners listened appreciatively to these remarks. The audience gasped in disappointment when Commissioner David Gantt announced his support for the Progress proposal because it was for a level of power already being consumed. After a five-minute recess the lease was approved on a voice vote.

Commentary Time
There’s something to be said for people having to choke on their own exhaust, and that’s the effect another local power plant will have on the citizens of Buncombe County. While we’re at it, shorter transmission lines may result in less power loss than “importing” electricity from Ohio as is currently done. Thirdly, Progress Energy is in business to sell a commodity. It has no more incentive to curtail sales of its product than we consumers have to reduce our purchases of it. And finally, it wasn’t certain after listening to dozens of 3-minute comments that conservation and alternative sources could meet the need by the December 2009 deadline.

Nevertheless, Nathan Ramsey, David Gantt, David Young, Carol Peterson, and Bill Stanley earned infamy that night. After two years of secret talks with Progress about the looming peak power issue they couldn’t spare 30 days to learn whether green alternatives might be available. Instead they sprang the new plant on the public early in December and railroaded the lease through six weeks later. Ramsey, Gantt, Young, Peterson, and Stanley voted to deal with global warming and lousy air by staying indoors and turning up the air-conditioner.

—Michael Hopping
Copyright © 2007 all rights reserved
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Covering The Cliffs
The Indie, 5:47, March 16, 2007

Rising Tide introduced itself to Western North Carolina with a media splash on the morning of February 6th. Two Rising Tide climbers draped a highly visible banner reading, “Burning Oil Ain’t Progress—No New Woodfin Power Plant” from a billboard overlooking Highway 19-23. The act tapped into widely felt sentiments regarding the Buncombe County Commission’s sweetheart land lease deal with Progress Energy and sent a buzz of positive energy through the county.

Asheville police responded to the rush hour protest with a nine-car swarm. Unable to reach the climbers or their offending banner, the short arm of the law had to be augmented by a fire department ladder truck. Micah Lee, 21, and Abigail Singer, 27, were eventually arrested on misdemeanor charges of trespassing and resisting arrest. (Lee denies resisting officers except by virtue of the difference in altitude.) The banner was cut down about 9:30 am.

Cliffs billboard action, photo courtesy of Rising TideSinger and Lee were released on bond later that day. The first round of court proceedings is scheduled for March 19th. Attorney Bruce Elmore Jr. represents the pair on a pro bono basis. Donors responded generously to an appeal for money to recoup the $800 bail costs, Lee says. [Note: Lee and Singer eventually resolved the legal proceedings by pleading guilty to trespassing.]

Rising Tide?
Rising Tide is a grassroots, non-violent, direct action group that first appeared in the Netherlands in 2000. The Rising Tide North America website puts it this way: “Rising Tide is an international network born out of the conviction that corporate-friendly and state-sponsored ‘solutions’ to climate change will not save us. As a matter of survival, we must decrease our dependence on the industries and institutions that are destroying the planet and work toward community autonomy and sustainable living.” Link

Rising Tide North America and Rising Tide of North Carolina were launched in 2006 by Earth First!ers. According to Lee, participants in the North Carolina movement are also apt to identify, as he does, with Katuah Earth First!. Other Rising Tide actions in the Southeast have included blocking road access to a coal-fired power plant in Carbo, Virginia, and a banner protest against genetically modified trees and monoculture timber plantations. The latter occurred during an industry-sponsored event in Charleston Harbor. Rising Tide’s objective, Lee says, is, “doing what we think will work” to address a problem.

Often, as in Asheville, the intent is to heighten or focus public awareness at the risk of arrest. But not always. Rising Tide is sponsoring a 2007 Spring Roadshow to network, educate, and encourage climate change activism in the East. Locally, Rising Tide also collaborates with the Energy Futures taskforce, a consortium devoted to stopping the Woodfin power plant and offering green alternatives to expanded fossil fuel or nuclear generation.

Energy Futures knew nothing of the billboard event until it was reported in the press. Lee says this was by design. Pre-action collaboration between police and social justice groups has become popular in recent years. But the comfort zone created by agreed-upon choreography can normalize and limit the impact of an action. Lee believes surprise was an important factor in the media-grabbing success of the billboard protest. He says this was also true at Carbo. “We had the front page of the three closest papers, including Newport, Tennessee. Then the next day [the papers] were apologizing for giving us so much coverage.”  

Also in contrast to many peace and justice organizations, Rising Tide and Earth First! are comfortably anarchic. An Earth First! website proclaims, “Earth First!ers believe oppression of humans and oppression of the Earth come from the same source: a basic disrespect for life.” Lee says the problem is addressed by taking pains to avoid any hint of discrimination or hierarchical bias. A formal consensus model drives decision-making. There are no official leaders or group members. Job tasks are self-assigned, he tells me. “It’s important everyone involved feels comfortable and included and listened to. It helps people get committed and builds a supportive community.”

The consensus model can have pitfalls but these haven’t been a problem in Rising Tide thus far. In Lee’s estimation Rising Tide works, “because people share similar goals and have other things to do than [sit through interminable] meetings. It has to do with trust.” He acknowledges that the larger the group, the harder it can be to achieve the necessary degree of unity. But he holds up the examples of the Zapatista and Oaxacan resistance movements in Mexico as proof that large scale non-oppressive governance is possible. “Nowadays more and more people aren’t thinking in terms of waiting for the revolution,” he says. “It’s more like the constant challenge of building support and different structures that will attract people.”

The Cliffs
The billboard Rising Tide temporarily shaded from the sun’s harmful rays was an advertisement for The Cliffs at Walnut Cove, “Asheville’s only gated, master-planned golf community.” Walnut Cove boasts a Jack Nicklaus Signature golf course and 550 homesites on 1500 acres of former farmland.  (The humblest lot in the subdivision runs about $500 K. Prices for a house to put on it start at $1.1 million.) Walnut Cove is one of eight Cliffs developments in our region. Its most recently announced sibling, The Cliffs at High Carolina, is a 2,500 acre project straddling the mountain ridge between Swannanoa and Fairview.

No less than Rising Tide, Walnut Cove’s corporate parent, The Cliffs, considers itself a model for environmental sensitivity, community, and wellness. Unlike Rising Tide, The Cliffs also values luxury and gated privacy.

The Cliffs has no comment on Rising Tide, the billboard protest, or the proposed Woodfin power plant. But corporate spokesman Jamie Prince was willing to address questions about the company’s environmental efforts. “At The Cliffs Valley [located near the Greenville watershed in South Carolina],” he reports, “we preserved more than 250 acres of property within the community and set up an adjacent tract to be transferred to The Nature Conservancy. We work in concert with The Nature Conservancy often, and have a strong relationship with Upstate Forever, a not-for-profit, environmentally-focused organization based out of Greenville, South Carolina.” In addition, Parkland Trust, a voluntary nonprofit funded by Cliffs management and homeowners, preserves land within the Cliffs communities. Prince says the Trust may one day look beyond those borders.

He continues, “Our web site hasn't really ‘caught up’ with some of the environmentally-friendly and sustainable building practices we're currently engaged in. We will have press releases that you'll begin to see in about a month or so, that will begin to focus more on these aspects of The Cliffs' homebuilding endeavors.” A January press release for The Cliffs at High Carolina may have begun the update process. According to a press release, steps will be taken at High Carolinas to limit the visual impact of the development as well as impacts on remnant natural areas and local traffic. Energy issues and related building requirements aren’t covered.

Tee Time
There’s a world of difference between the Rising Tide and Cliffs visions of environmental stewardship/responsibility. Proponents of sustainability can find a side-splitting wealth of contradiction and hubris on a stroll through The Cliffs websites—perhaps the only Cliffs property they may legally visit—including the audio treat of James Taylor crooning, “Carolina On My Mind.” What came first to my mind were jokes and cheap shots. But baronial as The Cliffs outlook may be, the company seems genuinely to recognize that community, healthful living, and environmental consciousness are values worth investing in, if only for the benefit of the fortunate few inside the gates. The Buncombe County Commission hasn’t progressed even that far.

—Michael Hopping
Copyright © 2007 all rights reserved
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Won for Woodfin
The Indie, 5:49, April 16, 2007

Progress Energy’s plans for a new diesel-fired peaking power plant in Western North Carolina suffered a major setback on April 2nd when the Town of Woodfin’s Planning and Zoning Adjustment Board voted unanimously to deny Progress a “conditional use” permit for the plant. It was to have been built on a 78-acre tract the company leased from Buncombe County for $1 per year. The P&Z Board’s 12:15 am decision was greeted with jubilation by an audience that had, along with the board, endured a five-hour public hearing.

The Progress Energy Case
The case for granting a conditional use permit was led by Progress spokesman Ken Maxwell. Maxwell is a likable and well-spoken fellow who came equipped with nicely designed visual aids. Rather than dwell on how the plant would meet Woodfin ordinance requirements, he concentrated on an assertion of necessity for a new peaking power plant. A current purchasing agreement for peak power generated out of state will expire on December 31st 2009. Maxwell spoke at great length as did a supporting expert witness, a real estate appraiser who concluded the plant would have no adverse effect on real estate values. He was so repetitious and dawdling in his presentation that many concluded his job may have included prolonging the proceedings. If so, he was more successful at that than building his stated case.

The opposition’s volunteer expert witnesses did hang on to eventually testify. But by midnight, the estimated crowd of 200 had dwindled to 67. Many who signed up to speak were no longer present when their names were called.

Effective Opposition
Plant opponents approached the hearing in a workmanlike fashion. The strategy began with turning out a crowd to demonstrate public interest. Local groups and individuals held public education events, went door to door, handed out cards to be mailed to board members, encouraged Woodfin witnesses with a personal stake in the decision to come forward, and beat the bushes to increase P&Z meeting attendance. Two Woodfin residents new to active citizenship, Ron and Linda Larsen, were instrumental in these efforts. An Asheville business group had been running a TV attack ad labeling plant opponents as “EXTREMISTS.” Linda said a woman she’d known for years volunteered to testify at the hearing after learning that Linda was involved.

Opponents knew that even an impassioned public outcry wouldn’t carry the day, however. They hoped that the P&Z decision hinged on a judgment about compliance with town ordinances. The granting of a conditional use permit—exception to usual zoning requirements—required several criteria to be met. Two ordinance provisions focused the debate:

(A)  The establishment, maintenance, or operation of the conditional use will not be detrimental to or endanger the public health, safety, morals, comfort, or general welfare;
 
(B) The conditional uses will not be injurious to the use and enjoyment of other property in the immediate vicinity for the purposes already permitted nor substantially diminish and impair property values within the neighborhood;

Dr. Susan Kask of the Warren Wilson College Economics Department cited articles in respected academic journals as well as her own research findings to call the appraiser’s counter-intuitive conclusion about property values into serious question. Developers of three large residential tracts near the plant site testified to the actual dollar losses they anticipated and subsequent negative effects on Woodfin property tax receipts. Other property owners, including one who’d recently bought his house and commissioned a second appraisal to assess the impact, reported an adverse impact equal to the cost of a four-year undergraduate college education. A young man lamented that he’d talked his in-laws into moving to Woodfin. “Now I’m an idiot because there’s a power plant going in.” A businessman—found during the Larsens’ door-to-door campaign—announced that construction of a fossil fuel plant would cause him to locate a new green-building enterprise elsewhere. “You don’t build a bird sanctuary next to a poultry slaughterhouse,” he said.

Clay Ballantine, MD, an Asheville internist and respiratory medicine specialist, testified to numerous deleterious health effects directly attributable to the air pollutants listed in the Progress air quality permit application. Relying on medical literature, he was able to convert the stated pollutant tonnages to dollar costs for the treatment of pulmonary diseases in Buncombe and surrounding counties. He noted that asthma is already the single most expensive disease treated at the Buncombe County Health Department. Ballantine’s numbers went undisputed by Progress representatives.

Won for the Books
In the end, property values didn’t come into it. The P&Z board voted unanimously to deny the Progress conditional use permit on subsection (A), the public health and general welfare provision. Rather than change course, Progress began searching for a new site and, as of this writing, had not ruled out appealing the P&Z decision.

What might Progress do differently next time? It was outgunned at the Woodfin P&Z meeting by an attendance ratio of about 40 to 1.Progress officials and hired help appeared to be the only supporters of the plant who appeared. A pro-plant media blitz may be on the horizon. It also seems likely that next piece of property Progress selects will be in an area less protected by P&Z restrictions.

And the opposition? In a press conference held the day after the victory in Woodfin, Avram Friedman of the Canary Coalition said, “The message that should be heard. . . is that you can’t bypass the democratic process. If Progress Energy wants to find another site we’ll follow them and beat them there too.”

—Michael Hopping
Copyright © 2007 all rights reserved
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The Second Act Begins:
Progress Energy convenes CEAC
The Indie, 5:52, July 1, 2007

In the wake of Progress Energy’s failure to win approval for the construction of a new peaking power plant in Woodfin, PE has publicly embarked on a change of course. For the first time in company history, it has chartered and appointed a Community Energy Advisory Council (CEAC) to advise on how best to meet the electrical needs of a service area. Addressing CEAC’s June 21 inaugural meeting, PE Chairman and CEO Bob McGehee asked the group for help in determining which energy-efficiency programs fit best in this region, how to build strong community support and participation in these programs, and for CEAC’s perspectives on “power generation options and related issues.”

The meeting was a green and gracious affair. Held at the North Carolina Arboretum in Bent Creek, council members arrived to gifts of compact fluorescent light bulbs packed in boxes sporting the PE logo. Coffee and saucer-sized cookies were served.  Law enforcement personnel were strategically deployed in and around the building but had a quiet afternoon.

The council and an audience of about thirty heard presentations from McGehee; Lloyd Yates, the newly named president and CEO of PE Carolinas; Robert Sipes, vice president of PE Carolinas’ Western Region; Samuel Waters, PE’s director of System Planning and Regulatory Performance; and Jo Anne Sanford, former chair of the North Carolina Utilities Commission. (Sanford will facilitate future CEAC meetings.)

Topics included the mission and objectives of the CEAC, an overview of PE’s electrical system in WNC, and an overview of energy efficiency goals and programs. Information was more detailed than that dispensed at previous local open meetings. These data included statistics on residential energy use by type of appliance and a chart showing 2006 day-to-day peaks and troughs of electrical demand. Waters said WNC’s highest use spikes are typically in winter, not summer. Last year’s highest peak occurred between 7-10 a.m. on a December day. This demand pattern is due to the fact that 31% of households use heat pumps or electric strip heat, accounting for 38% of all residential electricity use. An additional 16% of residential use is attributed to electric water heaters.

The text of McGehee’s comments and the slides used in other presentations can be downloaded. Speakers seemed surprised and gratified by a continuous barrage of competent and sometimes pointed questions from council members. Questions from the audience weren’t allowed.

A Step Forward?
CEAC is not the only energy council in WNC. Local energy and environmental activists are also creating one, the Sustainable Energy Council of Western North Carolina. Participants in that group are divided on the subject of PE’s initiative. Avram Friedman, executive director of the Canary Coalition, is a harsh CEAC critic. In a press advisory, Friedman announced that he’d skip the CEAC meeting. “I don't want to contribute to the perception that Progress Energy is engaged in a legitimate process involving meaningful community input,” he wrote. “Progress Energy hasn't responded to phone calls and emails inviting them to participate in a real dialogue with members of the environmental community about Western North Carolina's energy future.  Instead, the corporation appointed an Advisory Board from what it considers a cross-section of the community, and created a charter with no public input.”

Ned Doyle (Southern Energy and Environment Expo), did make the trek to the Arboretum. He said, “The entire publicity event was masterful in its design and presentation, obfuscating the essential issues and laying a flawed foundation for moving forward. At the same time, it's a very small first step towards -potentially- meaningful dialogue and community input, a radical change itself from decades of arrogant indifference to the public, the environment and the laws of physics.”

Norma Ivey (WNC Alliance) concurred with Doyle’s assessment and added, “One major omission that I thought should have been there today is a doctor. The importance of medical impacts from the burning of fossil fuels, while mentioned in passing, was certainly sidelined and should have received more attention.”

The impressions of CEAC council members were generally more favorable. Michael Shore (Environmental Defense) sits on both the Sustainable Energy Council and CEAC. Shore was not shy about asking questions of the PE executives, including one he posed to McGehee. Why, he wondered, was PE involving the community only now, instead of when the Woodfin plant was first under discussion? McGehee replied, “We looked at putting in small peaking units as no big deal. We learned a good lesson from it at all levels of the company. We learned that in this area anything to do with the environment is very important. Our constituency needs to be brought in.”

After the meeting, Shore’s comment was circumspect. “I think Progress Energy realizes that folks in Western North Carolina have a high standard.  We want clean renewable energy and efficiency instead of expensive new power plants.”

CEAC member Rick Lutovsky (Asheville Chamber of Commerce) told me, “It was a good start. PE is approaching this in a commendable way.”

Dave Hollister, (Sundance Power Systems) an environmentally-oriented member of CEAC, believes PE’s desire for community involvement is sincere. He’s less sure about how much influence CEAC can have. “I believe the door has been cracked open. What PE understood was that its organizational blinders were so severe that they were taken by surprise. How much of this process can penetrate their DNA remains to be seen.”

CEAC member Margie Meares (Clean Air Community Trust) also expressed uncertainty about the impact CEAC will have but was more focused on a possible energy intervention point revealed by the presentations. “It was clear that a substantial improvement in energy reliability can be gained by reducing the winter time peak load which is driven by electric heating. Providing efficient heating systems and well insulated homes to our citizens, probably the poorest who can least afford the high energy bills, seems clearly to be part of the region’s energy solution.” 

Buncombe County Commissioner and CEAC member David Gantt told me, “I was impressed that the top leadership from Progress Energy came to speak with us at this initial meeting.  I was pleased to hear Progress Energy's CEO admit that the company must change how they make energy decisions, particularly concerning the need for more meaningful public input before decisions are made.  I believe that Progress Energy understands that the days where no local residents questioned the need for new facilities are over.” He pledged to do his best to represent the residents of Buncombe County and WNC in the dialogue.

Sitting in for Asheville City Councilwoman Robin Cape, Brownie Newman said, “This meeting was the beginning of an important dialogue between the community and our public utility about our energy future. I was heartened to hear from Progress officials that they understand we must move beyond the status quo of energy policy in western North Carolina.”

Community Input
The CEAC charter grants the council only advisory powers. PE is free to accept or ignore any proposals that bear on company decisions. Until the council begins to take more control of meeting agendas and make substantive recommendations, questions about the quality of PE’s commitment to the project will remain open. In this inaugural meeting, Sanford didn’t smile on requests from Meares, Hollister, and Shore to broaden council membership, specifically to include representation from Warren Wilson College, the faith-based community, Clay Ballentine, MD, and more local energy experts.

The public, termed observers by the CEAC charter, is invited to attend council meetings. Although members of the audience weren’t permitted to speak at the June session, facilitator Sanford promised that there would be opportunities in future. The dates for the next two meetings are July 20 and August 17, 8:30-11:30 a.m., locations to be determined later. People interested in learning more about CEAC can find information on the PE webpage identified above. The public is also invited to communicate with the company on these issues by email, wnc@pgnmail.com.

The parallel citizen’s group, Sustainable Energy Council of WNC, has no direct relation to PE. Its meetings are also open, and members of the public are invited to participate. Meetings are generally held on alternate Wednesdays, 1:30-3:30 p.m. in the Clean Water for N.C. meeting room, upstairs at 29 ½ Page St. in downtown Asheville. Consult the Sustainable Energy Council website for a member’s telephone number and the date of an upcoming meeting.

Although the two councils are proceeding along different tracks, there is some cross-fertilization at the level of memberships. It can only be hoped that the groups are able to develop mechanisms for coordination. Across the spectrum of opinion, from McGehee to Friedman, the bottom line on energy efficiency is that attitudes and habits have to change at all levels: personal, business, government, and utility company. Modifying the behavior of entire communities is never easy. Coherent messages and assistance are called for, issuing from as many different sources as possible. At the end of the day, community input, in the form of changed behavior, will determine our region’s energy future. PE has provided a two-year window of opportunity for us to see what we can accomplish without new fossil fuel or nuclear plant construction. It’s in all our interests to show them we’re up to the challenge.

Sidebar
The following people are members of the Community Energy Advisory Council appointed by Progress Energy. Major affiliations are listed in parentheses.

  • David Gantt (Buncombe County Board of Commissioners)
  • Robin Cape (Asheville City Council)
  • Lee Galloway (Waynesville town manager)
  • Jeff Loven (French Broad EMC)
  • Karl Kuchta (Unimen)
  • Michael Shore (Environmental Defense)
  • Margie Meares (Clean Air Community Trust)
  • Terry Albrecht (Waste Reduction Partners)
  • Dave Hollister (Sundance Power Systems)
  • Rick Lutovsky (Asheville Area Chamber of Commerce)
  • John Oswald (Mills Manufacturing)
  • Patrick Fitzsimmons (American Red Cross)
  • Paul Szurek (Biltmore Farms)
  • Edna Campos (Edna Campos & Associates)
  • Lavoy Spooner (AT&T)
  • Chuck Pickering (Biltmore Estate)
  • Harry Harrison (YMI Cultural Center)
  • Vernon Daugherty (A-B Tech)

—Michael Hopping
Copyright © 2007 all rights reserved
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The Second Act, part deux:
Progress Energy holds second meeting of the CEAC
The Indie, 6:54, August, 2007

It’s time now for another chapter in an ongoing drama that may alter Western North Carolina’s energy future.  The unfolding relationships between Progress Energy, its Community Energy Advisory Council (CEAC), and local energy/environmental activists are as intriguing as the underlying issues are important.

Seldom do outsiders have the opportunity to witness the courtship behavior of a major corporation and a council it has selected to represent the public it serves. Will CEAC be treated as a full partner or just get used? Can Progress and CEAC find ways to achieve the efficiency and conservation both claim to want? When will the company try to slip a smokestack into the action? Local activists, relegated to the role of CEAC’s back seat brother, serve as chaperones.

In our last episode, Progress and CEAC first met at the Arboretum, a green and restful setting where tranquility was conspicuously assured by law enforcement personnel. Council members heard presentations from top corporate brass, were gifted with two CFL light bulbs, and had a thousand questions for the speakers. Progress seemed pleased by the display of curiosity and initiative. Jo Anne Sanford, a former chair of the NC Utilities Commission and Council facilitator, promised to explain the utilities regulatory process at the next meeting. Also, in a nod to the contingent of activists in the audience, Sanford said that public comment would be allowed in future. In fact, the utility invited public participation. Presentation materials would be available online, and an email address, wnc@pgnmail.com, was provided for public comment and suggestions.

Second Date
Progress did upload slides from the June presentations in a timely manner. The website was tardier about releasing the location of the July 20th rendezvous. Four days before the scheduled date, after an email to wnc@ had gone unanswered, a direct inquiry of some Council members and Progress spokesman, Ken Maxwell, shook the information loose. Maxwell thanked me for bringing the lapse to his attention.

No police loitered in the hall outside A-B Tech’s Ferguson Auditorium on the morning of the second meeting. The pastries on offer were more run-of-the-mill than at the Arboretum, and the coffee came in boxes. But Progress wasn’t dating on the cheap. A company manager, Chris Edge, was describing a pilot program in which a group of residential customers is given a device that instantaneously displays home electricity usage, when he was interrupted by Robert Sipes. Sipes, PE’s regional vice president, announced that CEAC members will each receive one of the wireless gadgets. Edge valued the Blue Line Innovations PowerCost Monitor at $160. PE may have overpaid. The unit is advertised at $135, but that’s niggling. The gift du jour was choice swag.

The first speaker of the morning had been Sanford, with her promised regulatory overview. She raised some spirits by saying that environmental costs could be considered in Utility Commission rulings. But those hopes were dashed. Sanford wasn’t referring to global warming, mountaintop removal, or diseases associated with polluted air. To her, environmental costs are the expenses incurred by utilities in the course of complying with environmental laws.

Lloyd Yates, president and CEO of Progress Carolinas, followed Sanford to introduce Edge and Cari Boyce, who would discuss projects designed to reduce electrical demand. He reminded CEAC of the utility’s goal to double energy savings in the Carolinas to 2000 megawatts. Efficiency and conservation, he said, are crucial to PE’s balanced approach to providing reliable electricity. He didn’t mention that another element of the balanced approach is building new power plants.

That omission was rectified during the public comment period by Richard Fireman, Western Regional Director, NC Interfaith Power & Light. The questions Progress wants to address are too small, Fireman said. Addiction to fossil fuels is suicidal on a global scale. According to him, the company has faces other than the green one it shows CEAC. “While going through the Woodfin oil fired peaking plant process, and then creating this panel, Progress Energy has been simultaneously working for months to get legislation passed in the NC legislature that will make it easier for them to finance at public expense, and at no risk to themselves and their shareholders, new coal and nuclear power stations.”

Fireman was referring to Senate Bill 3. SB 3 is the outcome of what began as a proposal to mandate more electricity generation from renewable sources. As dickering in Raleigh progressed, those requirements were watered down, and utility interests inserted a provision that would allow ratepayers to be charged for “Construction Work In Progress.” Under CWIP, utility companies avoid the financial risks of building new fossil fuel and nuclear power stations. Customers foot the bills, regardless of whether a plant is ever completed. (North Carolina outlawed CWIP financing in 1982 when companies were perceived to have abused the privilege.)

Although this month’s presentations to CEAC focused on methods to promote efficiency and conservation, none of the speakers mentioned rate schedules. Residential customers, for example, might be charged a low rate for the first few hundred kilowatt hours used per month and progressively higher rates as use increases. I asked Sipes if PE’s commitment to saving energy included revising rate structures to reward efficiency and penalize excess. He agreed that rates could be a powerful motivator but told me the company isn’t planning to ask the Utilities Commission for changes any time soon. PE’s next scheduled “rate case” before the Commission is in 2009. By then, PE’s self-imposed moratorium on the construction of coal and nuclear plants will have expired. Projections for the region’s future electrical needs will apparently be based on behavior shaped by the existing rate structures.

Among the demand reduction projects Edge did outline in his talk were surveys designed to gather information and give feedback on consumer electrical habits. Also, in conjunction with Home Depot, Progress plans to sponsor a “Western Region Energy Expo” this October. Home Depot shoppers will be offered information on efficient appliances and power conservation. Both initiatives follow in the footsteps of famed sustainable energy crusader, Ned Doyle—not a member of CEAC. Doyle’s popular Southern Energy and Environment Expo is in its seventh year. The 2007 edition will be held August 24-26 at the WNC Ag Center. Our Southern Community, another Doyle enterprise, launched an online residential energy survey in May.

Boyce, PE’s director of external communications, followed Edge. She unveiled the company’s new energy efficiency ad campaign. We can expect to start seeing energy saving tips in print, on television, and online. These will be presented by “Save The Watts Guy,” a male figure clad in a compact fluorescent light bulb.

But apart from these measures, most of the company’s proposals for reducing electrical demand are still in the talking stage. Whatever rubber they possess is far removed from any road. Notably missing from most proposals were plans to engage existing community programs and personnel: builders, building inspectors, heating & cooling contractors, and the like. Council members broke into Edge’s presentation several times with recommendations for liaison with such intermediaries. Edge took notes.

Genial Awkwardness
PE and CEAC are trying to like each other, despite mutual ignorance about what to do with their hands and troublesome doubts yet to be forthrightly addressed. Council member Margie Meares raised one of them with her observation that, “Utilities companies are required to have efficiency programs but aren’t incentivized to make them work. They can’t recover their costs for selling less.” Sanford smiled sweetly, tap danced for a minute or two, and then said she’d be happy to discuss it at length some other time.

The proceedings ran long. After quick words of appreciation all around, it ended in a scurry toward other engagements. I did catch Maxwell for an update on the status of the Woodfin property lease. (Progress has previously stated that, unless the site is used to generate power, the company will return the land to the county. Woodfin turned down PE’s proposed oil-fired plant on April 2nd. The lease remains in effect.) I asked Maxwell what the holdup is. He replied that power generation on the site is still a possibility, though not an oil plant. The small acreage also rules out coal and nuclear, he said, but there may be other options, including solar or other renewable technologies. He didn’t expect a final decision on the lease for several more months.

The next CEAC meeting is set for August 17, 8:30-11:30 a.m. Location details aren’t immediately available. . . .

—Michael Hopping
Copyright © 2007 all rights reserved
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CEAC III: What are we doing here?
The Indie, 6:55, September 1, 2007

At its third public session, August 17th, Progress Energy’s Community Energy Advisory Council (CEAC) flirted with entering a new and more serious phase of existence. The earlier meetings had been dominated by presentations from Progress executives and employees. This time, the majority of the two hours allotted went to a roundtable discussion among CEAC members. They used it to raise the issue of the Council’s function and usefulness.

The meeting began innocently enough in the new Asheville Chamber of Commerce boardroom. Coffee and breakfasty goodies, no gifts for Council members, but they did get the cushy chairs. A single row of lesser accommodations along a wall was provided for public observers. PE manager Chris Edge opened the festivities with a continuation of last month’s report on specific energy efficiency and conservation projects the company has in process. The plans for addressing heating, ventilation, and cooling system inefficiencies are still nebulous.

The details for electric strip heating and water heater load control are becoming clearer. If widely accepted by customers, the company can realize significant reductions in peak power demand spikes by remotely turning the appliances off for brief periods. All that’s required is a small onsite control box. Progress will begin recruiting customers within the next several months. Edge wasn’t specific about what the company will do to entice people to sign up.

Compared to the megawatts consumed by heating water and buildings, lighting is small potatoes. But lightbulbs are an easy place to start. Edge reported that Progress and Home Depot are teaming up for a compact fluorescent lightbulb (CFL) program this fall. In October and November, Progress customers will be able to purchase up to twelve CFLs at two (locations not revealed) Home Depot stores for $.99 each. This price is under cost. Progress will make up the financial loss to Home Depot. Ads for the program will be mailed with electric bills. Edge asked for and received advice about other promotional strategies. Several Council suggestions involved the public school system. Notes were taken. Edge expects a broader public rollout of the CFL promotion in 2008.

What are we doing here?
Council member Michael Shore, Environmental Defense, was the first to try to redirect the session. He suggested that it’s hard to know where CEAC should focus its efforts until concrete goals are established. “What might meeting electrical demand look like in twenty years?” he asked. Paul Szurek, Biltmore Farms, piggybacked on that by asking about the status of new consumer and building technologies. What’s available now? What’s likely to be economically feasible within the foreseeable future? Vernon Daugherty, A-B Tech, wondered why Progress was talking so much about residential customers and ignoring the commercial and institutional sectors. Potential efficiency savings there are huge, he said, but conversions cost money that isn’t commonly available. Could Progress design some incentives to address this problem?

Asheville City Councilwoman Robin Cape drew a bottom line about the scope of the Council. “If we’re here to offer advice about the company’s efficiency programs, that’s great, but I’d like to see us get out of the tiny conversation and into the bigger one about the future of energy in WNC. If it’s just about advice, I’ve got lots of meetings and other things to do.”

Robert Sipes, Progress Carolina’s western region VP, jumped to his feet. “CEAC’s scope is to address the bigger issues. But the lowest hanging fruit is these energy conservation programs. Visioning is important, but we can’t neglect the here and now.”

Dollars and cents was another major discussion thread. Terry Albrecht, Waste Reduction Partners, asked for information on the economics of various programs, incentives, and break-even points. David Johnson, a public observer who works in the electrical efficiency industry, used the public comment period to drive home the importance of incorporating actual numbers in the Council’s deliberations: megawatts of demand reduction, consumer costs, the costs of incentives, etc. Waving his wallet, he said, “A lot of the time, people think with these.” Shore wanted to know, as had Margie Meares during the July meeting, how Progress planned to make money in the future. If efficiency works, sales won’t climb. Like Meares, Shore didn’t get an answer.

Neither did concerns about electric supply. Council member Lee Galloway, Waynesville town manager, fired the first shot, “I’m not convinced at all that Progress Energy’s electrical demand can be met through energy efficiency. I don’t want to hear Ken [Maxwell] or Robert [Sipes] saying our industries have to cut back.” Jeff Loven, a Council member who represents the French Broad Electricity Membership Corporation, another Progress wholesale customer, put it in the here and now. “We got a call last week about curtailing our use.”

During the public comment period, I tied those questions to the Woodfin land lease. Maxwell has said that the land will revert to Buncombe County if Progress doesn’t generate power there. He has also said that no decision has been made about that yet. Progress CEO Bob McGehee told CEAC that the Woodfin failure taught the company a valuable lesson about the importance of community involvement in power plant decisions. “Given all that,” I asked, “why isn’t the power generation issue on the table here?” Sipes reaffirmed that community input is important to Progress. He said there are no active discussions about what to do with the Woodfin site.

Keep your hands where we can see them
Between the last meeting and this, the Council set its agenda via conference call. CEAC facilitator, Jo Anne Sanford, proposed another call, of forty-five minutes or so, before CEAC’s September 14th session. Council members could use it to discuss who to invite as guest speakers. Public observer Jim Barton expressed concern about deliberations conducted out of public sight. “If you’re going to have a conference call, I’d like to be listening in,” he said. He didn’t receive a verbal response.

Goodbye, Ken Maxwell
Those who have followed the Progress saga are familiar with company spokesman Ken Maxwell. At the close of the meeting, Sanford announced Maxwell’s impending departure. He’s going into real estate sales at Mountain Aire, a golfing resort development in West Jefferson. His successor at Progress Energy has not been named.

—Michael Hopping
Copyright © 2007 all rights reserved
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CEAC Proposes to Take Steps

Citing the departure of Ken Maxwell, who had been a key Progress Energy staffer, and a need to better define the Community Energy Advisory Council’s (CEAC) scope and process, Progress regional vice president Robert Sipes cancelled September’s scheduled session. In October, he opened the council meeting by saying, “We’ve turned a corner here with CEAC.”

Some changes were immediately apparent. Buncombe County Commissioner David Gantt had turned his seat over to Commission Chairman Nathan Ramsey. Facilitator Jo Anne Sanford was gone, replaced by Steve Cochran and Christina Nelson of Sustainability Strategies LLC, a company based in Asheville.

Like Sanford, Cochran and Nelson bring more to the table than facilitating talent. They’re plugged into other sustainability and development initiatives internationally and in the region. Local affiliations include the Community and Economic Development Alliance (for the “HUB” Plan), the Clean Air Community Trust, the Board of Visitors of Warren Wilson College, and the Sustainability Alliance of the Mountains.

The focus of the session was different as well. Council members filled the time with their hopes and concerns for what CEAC might achieve and the relevance it might or might not have to the looming megawatt deficit in 2010. Members made cases for establishing guiding values and concrete target visions. There were requests to get into the issue of rate structure and pleas for real numbers in terms of both megawatts and dollars. Others voiced concerns that efficiency measures would fall short and asked for realism about the probable necessity of new power plant construction. One of the latter, Lavoy Spooner of AT&T, said that public education should be an immediate priority. “This is a good discussion,” he concluded, “but what are we going to do?”

What the council did was appoint two subcommittees. One was assigned the task of proposing guiding values for CEAC. The other was to look into the possibility of expanding council membership. Meanwhile, Progress readied itself for the start of a previously announced campaign to sell below-cost compact fluorescent lightbulbs (CFLs) in partnership with eleven Home Depot stores in the Carolinas.

Shapes of Things to Come
The November council meeting opened with committee reports. Council members Terry Albrecht and Dave Hollister handed out a list of guiding values for general consideration. The suggested amendments to the CEAC charter emphasized sustainability, local investment, openness to the public, and consideration of environmental impacts. There were also statements about Progress’s responsibility to provide reliable electricity at competitive prices and a decent return on shareholder investment. The values were greeted positively around the table, but if Sipes accepted them on behalf of Progress I missed it.

Rick Lutovsky, representing Asheville’s Chamber of Commerce, delivered the report of the subcommittee on expanding council membership. The group felt that three significant groups were unrepresented. Warren Wilson College is a national leader in implementing sustainable energy policies on campus. He said seats should also go to representatives of the “economically challenged” and the Sustainable Energy Council of Western North Carolina, a citizen’s group that grew out of the successful drive to stop the Woodfin power plant.

These proposals were received without objection. A suggestion that the council could also benefit from the appointment of a representative of the faith-based community met resistance on grounds that all CEAC members have a moral compass. Final decisions on expanded membership were deferred to private discussions.

Chris Edge, manager in charge of “demand side” programs for Progress, announced some results of a 2007 survey of residential customers in WNC. He noted, with concern, that the percentage of homes heated by electricity has risen from 41% to 53% in the past ten years. Home and water heating contribute the bulk of WNC’s winter peak power demand.

The same survey revealed that 55% of Progress’s customers in the western region have at least begun the conversion to CFLs, compared to 46% for Progress Carolinas as a whole. During the weekends of Progress’s in-person below cost promotion at the Asheville Home Depots, CFL sales jumped 2,500%. These numbers far surpassed the increases at other participating Home Depots.

Edge also distributed his estimates of how much electricity can realistically be saved with voluntary hot water and space heating load control programs. Progress hopes to announce these in the spring. If 30% of residential customers sign up for hot water controls and 15% for strip heater controls, the savings amount to 32 megawatts of peak power. Better home maintenance, insulation, and continued conversion to CFLs, may save an additional 7 megawatts year round.

Thirty-nine megawatts is a lot of juice. If available on a 24/7 basis rather than only during demand peaks, the author calculates that it would be enough to power 17,000 average homes in WNC. But impressive as that is, Edge’s projections still fall 90 megawatts short of the amount necessary to avoid adding new peaking power supplies at the end of 2009.

A discussion of specific goals, measures, and plans of action to address the predicted  megawatt shortfall had to be postponed due to time constraints. The council’s next public session will take place at 8:30 a.m. on December 14th at the Asheville Chamber of Commerce.

Shortfalls
The October and November CEAC meetings bore out Sipes’ assertion that a corner had been turned. The tentativeness between the company, the council, and individual council members was gone. People seemed ready to do business in a positive collegial atmosphere.  Perhaps in token of the change, November’s gift to CEAC members was a coffee mug, given in the hope, Sipes said, of reducing Styrofoam use at council meetings.

Just what business is to be gotten down to, and by whom, remains undefined. The tangible results Progress has so far achieved aren’t CEAC products. If CEAC has a role to play in the upcoming water and space heating load control campaigns, it will probably be in the areas of public education and cheerleading. Valuable assistance to be sure but unlikely to translate into much advisory clout for the council.

That’s one elephant in the room. There are others. If Edge’s energy savings calculations are borne out, the peak electricity saved by Progress’s campaigns, while sizeable, won’t be anywhere near enough. Business as usual thinking will counsel the construction of new fossil fuel or nuclear power plants.

Also, Progress profits remain generally tied to sales. The company has only limited incentive to act in ways that reduce the amount of electricity it sells, a point repeatedly raised by council member Margie Mears and others. If Progress permits it, and that remains to be seen, this may be an area where CEAC can earn its bones.

The State of California pioneered a way around the profitability issue after the 1973 oil crisis. Since then, per capita consumption of electricity has remained relatively stable there. This is in sharp contrast to a 50% increase in per capita consumption nationwide.  California’s single most powerful intervention, according to state energy commission officials, has been “decoupling” utility profits from sales

Decoupling is in its infancy in North Carolina. The mechanism employed by Piedmont Natural Gas has proven to be controversial as has Duke Energy’s proposed Save-A-Watt program.  Decoupling is evidently an uncomfortable issue for Progress as well. If CEAC is to function as more than a sounding board and supporting player for a mildly greener energy status quo, it will have to take a lead somewhere. It’s hard to think of a more potentially valuable place to do it than with decoupling.

—Michael Hopping
Copyright © 2007 all rights reserved
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The Other Face of Progress: CEAC VI

It had to happen eventually and, at the December 14th meeting of Progress Energy’s Community Energy Advisory Council (CEAC), it did. Only a day earlier, the US Senate defeated an energy bill which, among other things, would have set national renewable energy standards for utility companies. The margin was one vote.

Minus renewable standards and with the continuation of $13.5 billion in tax breaks for big oil, the measure passed. Michael Shore and other CEAC members were not pleased to read in the Raleigh News & Observer that Progress Energy had lobbied against the stronger bill, objecting to the renewable standards.

The proposed federal requirements would have been tougher than the North Carolina state standards Progress eventually supported in 2007. Under the defeated federal bill, the company would have been required to produce 15% of its energy from renewable sources by 2020 rather than the 12.5% required in 2021 according to the state. More importantly, North Carolina permits Progress to count energy efficiency programs for up to 40% of the required renewable “generation.” The federal plan was far more stringent.

The hot seat
Whether fortuitously or by design, Progress Carolinas president, Lloyd Yates, was on hand at CEAC when the wind began to blow. To the company’s credit, Robert Sipes, vice president of Progress Carolinas Western Region, invited the interchange that occupied most of the meeting.

Yates said Progress is in favor of renewable energy standards, but the federal proposal was “a one size fits all approach.” It would have necessitated a “wealth transfer” to other states for the purchase of, for example, wind generated power. Progress customers in the Southeast would have seen higher electricity rates. Sipes added that some state utilities commissions also opposed the federal measure.

Robin Cape was the first to express her disappointment to Yates. “One size does fit all,” she insisted, arguing that air pollution is a national and global issue, not one confined to a particular state.

Dave Hollister dismissed the wealth transfer argument. “What’s the difference,” he asked, “between buying coal out-of-state and buying windmill power from Texas?” He found it hard to reconcile CEAC with “another part of the company working at cross-purposes to what we’re doing here. It would be great to see Progress start shouldering the cause [of renewable standards].”

Yates replied, “We’re in constant dialogue with officials in the Carolinas and Florida.” He wants more dialogue about pending bills rather than have one “shoved down people’s throats.”

Margie Meares described her reaction as “viscerally disappointed.” “You threw the baby out with the bathwater.”

“Progress will do the right thing after it has exhausted all other options,” Cape said, paraphrasing Winston Churchill. “What does it take to get into the middle of your hearts? We don’t have two more years. When are you going to start serving the public good?” “People are scared about the future of our kids. You’re fighting whatever hope we have of turning this [climate change] around.”

A scalded but still congenial Yates answered, “We believe in a balanced solution [efficiency, conservation, and state of the art generation]. We believe nuclear is a carbon-free technology. We’ll need it in North Carolina. I don’t feel like we’re fighting [the public good.]”

New CEAC member Richard Fireman recalled the one-year anniversary of the Woodfin peaking power plant flap. “This is an issue of trust and transparency. Woodfin was not transparent. Since then you’ve made progress in restoring public trust. Don’t blow it. We’re not going to get anywhere unless we really learn how to partner and collaborate about how to do sustainable and reliable energy policy. We have enough off-shore wind energy to cover all our needs.”

Chuck Pickering from Biltmore Estate pressed Yates and Sipes on their stated support of renewable standards. “How is Progress going to take a leading role in renewable standards? What steps are you going to take?”

Shore, Patrick Fitzsimmons of the Red Cross, Lee Galloway of the City of Waynesville, Paul Szurek of Biltmore Farms, and Sandy Pfeiffer of Warren Wilson College echoed the general discontent. Vernon Daugherty of A-B Tech pressed Yates again, “Don’t wait a year or two. Contact our senators. Tell them to put a good bill out there separately if necessary.”

Yates responded, “We did that last week.” (After the meeting, Yates clarified this statement. Progress had a meeting with Senator Burr, asking for a broader dialogue about renewable standards. Yates expected a meeting with Senator Dole sometime soon. I asked what specific proposals his people had made to Burr. “It doesn’t work like that,” he said. “We don’t write bills. That’s up to congressional staff. We have only three people in Washington.” Has Progress also talked with State Senator Martin Nesbitt (D-Buncombe), a staunch opponent of windmills in North Carolina? Yates grinned. I asked what Nesbitt said. “He says no,” Yates replied. “We keep talking to him.”)

Sipes praised the group at the close of the debate. “This is the first time we’re dealing with a tough issue in CEAC. We appreciate the dialogue.”

In other business
The Council’s jaundiced eye may have carried over to brief presentations by Progress officials Rob Caldwell and Sam Waters. Hollister and Shore objected to a Caldwell slide showing solar as the most expensive source of renewable energy. Caldwell admitted that solar hot water is an inexpensive technology; it should be clearly separated from the relatively high cost of photovoltaic cells. Shore claimed the price of photovoltaics is not that high when costed out over the life of a system.

Waters is building an online “dashboard” of integrated charts and graphs. It will allow CEAC members to test-drive changes to the energy supply and demand mix and see results in terms of supply, cost, and reliability. Members applauded the work but Hollister, perhaps thinking back to Caldwell’s distorted cost picture for solar energy, said, “We need to see your assumptions.”

The CEAC values subcommittee, now including Firemen, proposed a CEAC retreat for education and hammering out statements of values and goals. The recommendation met with unanimous approval. There was no discussion of public participation or monitoring of the proceedings.

This was the first CEAC meeting for two members appointed on recommendation of a council subcommittee. Pfeiffer is from Warren Wilson. Fireman was initially approached as a member of an alternative energy group, the Sustainable Energy Council of WNC. When SEC couldn’t agree on the appropriateness of participating, Fireman was appointed as a citizen at large. A third council addition, someone representing the “economically challenged,” has yet to be selected.

Abby Gage, speaking during the public comment session, reminded the group of the importance of education at all levels, including college. “We need to train the trainers.” Gage was also the only person to challenge the Yates statement on nuclear power. “Nuclear is not on the table,” she said.

The meeting closed with an announcement from Martha Thompson, community relations manager for Progress. The company has decided to make $25,000 available to organizations represented on CEAC for projects advancing CEAC’s work.

To heck with monthly tokens of appreciation. As the old Alka-Seltzer ad might have characterized the bucks on the table, “Now, that’s a spicy meatball.”

—Michael Hopping
Copyright © 2007 all rights reserved

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Sugar Time

Peak electricity demand in Progress Energy’s WNC territory hit a new record in early January, Sam Waters reported at the January meeting of the Community Energy Advisory Council (CEAC). Waters is director of system planning for Progress Carolinas. He hadn’t expected to see a 965 megawatt load until 2010.

The comment came in the midst of his presentation of an online “dashboard” tool CEAC members can use to generate rough projections of the effects of changing electric generation and utilization strategies. The dashboard’s underlying assumptions project steadily increasing demand throughout the coming decade and continued reliance on fossil fuel plants augmented by purchase contracts. The software allows users to plug in wind and photovoltaic sources as well, complete with company estimates of the associated costs. Users can also experiment with energy efficiency measures.

Council members were excited by the dashboard concept. Margie Meares hoped the new public Progress website could find room to display a gauge showing real world success in achieving efficiency targets.

Some members had concerns about the adequacy of the hidden assumptions used to calculate results. “Can we incorporate solar hot water as a separate item?” Robin Cape asked, noting that solar hot water systems represent a major energy efficiency opportunity and cost far less than photovoltaic arrays. Dave Hollister and Michael Shore agreed that the assumptions need improvement. Waters invited Shore to work on them with him.

Little progress toward efficiency
By 2021, renewable energy sources or energy efficiency programs must account for 12.5% of the electricity sold by public utilities in North Carolina. On the supply side, Progress is evaluating proposals from outside businesses for alternative generation. Senate Bill 3, passed in 2007, mandates that no more than 25% of it can be produced out-of-state.

On the demand side, few of the public education and efficiency initiatives Progress hopes to launch are operational. A residential load control system projected to shave 30 megawatts off wintertime peaks is on hold, awaiting action by the NC Utilities Commission. Progress spokesman Chris Edge said the earliest date for implementation has slipped to early summer.

Spreading some sugar
Martha Thompson, community relations manager for the company’s western region, announced the details of a CEAC Community Investment program. A total of $25,000 will be available this year for charitable community projects. “Investments will be linked to the overall business strategy of the company and compliment a sustainable, balanced solution strategy.” Recipients must be legitimate non-profit groups.

Applications for grant money may be submitted by CEAC members, their member organizations, or other interested parties. A CEAC subcommittee will screen requests and pass them on to company brass for final approval. Thompson and Progress regional vice president Robert Sipes hailed the program as a sign of trust in CEAC. The $25,000 figure represents 15% of the company’s local investment budget.

Program rules contain repeated references to funding projects in step with the company’s Balanced Solution, a defined three-tier approach. Conservation is given top priority, followed by energy efficiency and construction of state-of-the-art generation facilities. Among the sorts of groups not eligible for funding are “organizations that pose a threat or conflict with the goals, products, or employees of Progress Energy.”

After the meeting I asked several council members if they had concerns about implied quid pro quos tied to the money. Might the grant program be a local example of what we’re seeing in Washington and Raleigh, a deep pocket entity buying friends in a position to affect its interests? Some chose not to respond. A few others were curt or clearly nervous in stating their faith in the integrity of Progress. Richard Fireman wasn't bashful. He said he’d apply for funding if religious organizations weren’t also excluded by the rules.

Only two members were willing to grapple with the question of conflicts of interest. Hollister said, “This is an interesting issue which I have discussed with many folks on the CEAC already.  In many ways, a lot of what we are doing on the CEAC may have a direct impact on our business. It has always been a concern that there is no conflict of interest.  I do not believe there is in any direct way, and I feel that the transparency of our actions and intentions is key.  I would definitely support diverting money toward [environmentally oriented] groups. . . . It seems that the CEAC is really embracing the goals of avoiding the addition of any more combustion plants in favor of [energy efficiency] and [renewable energy].”

I posed the quid pro quo question to Thompson as well. She flatly denied any intentions along those lines. Might grant recipients be de-funded if they subsequently came out in opposition to a company initiative? Thompson replied, “I've answered as best I can.  Maybe as we move through the process, it will be clearer.”

In other CEAC business, the council recognized the resignation of member Karl Kuchta (Unimen) and welcomed new member Isaac Coleman of the Asheville Housing authority. CEAC’s next meeting will be an all-day retreat on February 8th, at the Pisgah View Community Center, 1 Granada St. in West Asheville. There will be no public comment period.

A new power plant for WNC?
Progress Energy needs to fill a 100 megawatt peak power shortfall by the end of 2009. It experienced higher than anticipated demand in early January, a record subsequently shattered by a 992 megawatt spike on Martin Luther King Day. Efficiency initiatives have been delayed and are not projected to save anything near 100 megawatts in any case. I asked Sipes whether Progress might have to propose a new power plant this year. “It’s possible,” he said, “depending on the results of efficiency measures.”

Do the math. Public opposition killed the Woodfin peaking power plant, a scenario Progress will not want to see repeated. Is the company pursuing two tracks with the Community Investment grants, hoping to mute key environmentalists in addition to engaging in good conservation, efficiency and educational works? I hope I’m just a cynical reporter. As Thompson says, time will tell.

—Michael Hopping
Copyright © 2008 all rights reserved
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CEAC Speaks

After months of groundwork and an increasing sense of urgency to address WNC’s electrical future, the Progress Energy Community Energy Advisory Council (CEAC) finally asserted itself at a February 8th council retreat. Progress may have gotten more advice than it bargained for.

The retreat, held at the Pisgah View Community Center, was in some ways an exercise in role reversal. In the morning, CEAC heard from outside energy efficiency experts instead of company officials. Sipes and his Progress colleagues seemed to be learning as much as council members.

Bill Prindle of the American Council for an Energy-Efficient Economy (ACEEE) said that regardless of global coal and other fossil fuel reserves, the US processing and distribution networks for them are about maxed out and will remain so. Trends in global demand for fuel and industrial commodities will keep fuel prices high and construction costs for power plants on the rise. For these and other reasons, Prindle said it is futile to try to prop up twentieth century energy policies and business plans. But although energy efficiency is cheaper than building power plants, utility companies, regulators, consumers, and building contractors often have no incentive to change their habits. He went on to detail the business sense of investing in combined heat and power generation and other emerging efficiency markets.
  
Prindle’s analysis received a second from John Wilson from the Southern Alliance for Clean Energy. It is reasonably possible, Wilson said, to approach a zero carbon electrical grid in the state without resorting to new nuclear reactors. Using data from North Carolina efficiency studies, he targeted short and long term interventions capable of reducing statewide electrical demand by 20% or more. Unfortunately, he said, experience in other states suggests that it may be hard to ramp up efficiency programs at a savings rate greater than 1% per year. Asheville City Councilwoman Robin Cape pointed to Austin, Texas, (greater metro area of 1.5 million people in 2006) as an example of the practicality of an efficiency approach. In the period 1982-2002, efficiency programs from Austin Energy cut consumption there by 450 MW, well above the entire coal-fired output of Lake Julian.

Stand and deliver
The morning also saw attempts to clarify CEAC values and decision-making processes. Paul Szurek, (Biltmore Farms), asked that the group use a consensus model rather than majority vote. A “five-finger” model was adopted. Members also agreed to be honest with their biases and to limit and focus the recommendation discussions. Still, nobody knew what to expect after James McLawhorn of the NC Utilities Commission public staff finished his presentation on regulatory procedure. It was suddenly showtime.

A group including Cape, Margie Meares (Clean Air Community Trust), and Shore came prepared with five pages of proposals. Richard Fireman had his own set. A quick scan of the Cape et. al. recommendations worried Szurek. He thought it was fine to ask Progress to achieve specific goals but objected to tying the company’s hands with mandates about how to achieve them. Loan programs for residential efficiency projects were one thing, he said; telling Progress to finance them was another. This reporter felt a heightening of the electricity already in the air, but before I had time to sharpen a pencil with it, the authors of the proposals accepted Szurek’s critique. Tensions dissipated.

The list of recommendations CEAC discussed and agreed to over the course of the afternoon was impressive, even stunning. Sipes took notes and rated the strength of group support for each. He told me his High, Medium, and Low priority scores were based on the five-finger sentiments of council members.

  1. Progress was asked to encourage and support energy audits for homes and businesses. It should develop energy efficiency and conservation programs tailored to every sector of the customer base. Progress should foster the availability of loans for efficiency projects based on the audits if work is carried out by certified efficiency and renewable energy contractors. (High priority)
  2. Progress was asked to advocate for stricter energy efficiency building codes. (Low priority)
  3. Progress was asked to undertake and support a broad range of energy efficiency education programs for building contractors, trades workers, building inspectors, developers, landlords, and the general public. (High priority)
  4. Progress was asked to seek out and encourage the adoption of combined heat and power technologies by large commercial and industrial customers. These technologies use waste heat for power generation. (Medium priority)
  5. Progress was asked to actively discourage the use of conventional electric water heaters. (High priority)
  6. Progress was asked to support or partner with certified independent contractors to install load control systems in homes and businesses. These units turn appliances on and off to moderate and shift peak power use. (High priority)
  7. Progress was asked to apply for an electric rate structure that truly incentivizes load shifting and efficiency. Care must be taken to prevent higher rates from adversely affecting those least able to afford either higher electric bills or efficiency upgrades. (High priority)
  8. Progress was asked to explore the possibility of expanding its business model to include more business and residential alternative energy systems, taking advantage of tax credits to offset costs. (High priority)
  9. Progress was asked to import its existing SolarWise (Florida) solar hot water rebate program to North Carolina, except that an electric backup water heater should not be required to collect the rebate. Progress should also institute residential and business rebate programs for other solar and geothermal technologies, including solar cell projects. (High priority)
  10. Progress was asked to lead the way in alternative technologies by installing solar electric panels on its building in Asheville and pilot industrial scale wind and solar projects here. (Medium priority)

This list incorporated most of Fireman’s suggestions. He promised to raise his remaining proposal, asking Progress to broaden its corporate focus to include environmental, social, and other currently externalized costs of doing business, at a future meeting. Some items on the Cape agenda remained for later discussion as well. No proposals were defeated at the retreat.

What did I just hear?
Progress already has plans for programs touching on some CEAC recommendations, albeit usually in a less comprehensive way. Others, including tiered rate structures and combined heat and generation, have often been resisted by power companies. Several recommendations, most notably getting out of the electric hot water business, pose direct challenges to business as usual.

There’s nothing common about a utility company advising customers to avoid its product. Sipes worried that state regulations might prevent Progress from advocating “fuel switching” from electric to gas water heaters. McLawhorn had left the meeting before the question arose, so I called him later for an opinion. The concept surprised him. “There is a rule against utilities stealing customers from each other. But it never contemplated a utility trying to give customers to another utility.” After a consult with the in-house attorney he called back to say there shouldn’t be a problem. New rules enacted in the wake of last year’s North Carolina energy bill, S3, give Progress a mechanism to recover lost revenues and incentives.

During the group discussion Sipes had expressed reservations about supporting combined heat and power. Although he hinted there were internal discussions at Progress about using waste heat from Lake Julian, he described the larger concept as “a lot of work.” He also seemed less than enthusiastic about restructuring rates.

After the meeting I asked his personal reaction to the list of recommendations. Sipes was upbeat, excited about getting to work on the list. He seemed to have recovered from his discomfort with combined heat and power, a technology he’s evidently not very familiar with. His concern about an overhaul of the rate structure, he said, was the burden it might impose on staff time.

Dave Hollister (Sundance Power Systems) entered the CEAC process last June saying “I believe the door [to greater public involvement in utility decisions] has been cracked open . . . How much of this process can penetrate [Progress’s] DNA remains to be seen.” At the close of the retreat, I wondered whether his view has changed. He said yes, to some extent. He’s pleased with how things are going.

Now what?
Sipes and the Progress technical staff will now go through the list of recommendations and report to CEAC next month. That meeting, March 14th from 8:30-10-30 a.m. at the Asheville Chamber of Commerce, may be another telling day in CEAC history. The advice Progress received would, if implemented, change the company’s business model. Progress will sell less of its existing product and open itself more widely to partnerships with citizens and outside contractors. Future profits will depend on the company’s ability to adapt to an emerging energy economy where more is not necessarily better.

That’s a tall order, but it’s the road Progress chose last spring when it appointed CEAC. The group has now come together to speak in a loud and unambiguous voice. Will the company have the courage and agility to rise to the challenge of the program CEAC laid out.

—Michael Hopping
Copyright © 2008 all rights reserved
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Maneuvering: CEAC IX

In February, Progress Energy’s Community Energy Advisory Council (CEAC) generated a wide-ranging ten-point list of recommendations for the company regarding energy efficiency and conservation. These went well beyond anything Progress had proposed. The company’s response during CEAC’s March 14th meeting demonstrated a new level of respect, but what sort of respect remained unclear. At times, Progress regional vice president Robert Sipes looked less like a man who’d discovered a valuable new resource than a pitcher whose last offering screamed overhead as a line drive homerun.

The uncertainty showed itself in the day’s first agenda item, an invitation for energy wonks from the North Carolina Utilities Commission (UC). It asked for comment on how to approach a study of alternatives to existing electric rate structures and policies. These issues featured prominently in CEAC’s February recommendations. Electric rates were seen as a critical factor in the success of aggressive conservation and energy efficiency strategies.

Several CEAC members had contacted Sipes prior to the meeting, wondering how to collaborate with the company on its wish list for the UC study. Sipes reported that he didn’t know what recommendations, if any, the company would make. But Progress had decided not to allow CEAC as a group to address the UC. Council members remained free to forward individual comments.

Margie Meares tried a soft sell with Sipes. By comparing priorities, she said, CEAC and Progress could jointly approach the UC with “what we want together.” Robin Cape noted Sipes had seemed uncomfortable with the CEAC recommendation on rates. She thought Progress could benefit from letting the UC conduct research the company might otherwise have to do itself. Dave Hollister said, “As an advisory body, we want [Progress] to forward our recommendations to the UC.” He was supported by Cape, but no decision was taken.

New Nukes?
Progress CEO Bill Johnson recently told financial analysts in Florida, “Where new baseload [generating] capacity is not needed until the middle of the next decade or later, then new nuclear is a viable option. In fact, given the prospect of carbon controls and the desire for energy security, new nuclear is the best option." Link In keeping with Johnson’s vision, the company intends to submit paperwork opening the door for two new nuclear reactors at the Shearon Harris site near Raleigh. This despite concerns that an extended drought could necessitate temporary shutdowns of the existing reactor. In Florida, Progress is further along with plans for new nukes. The two proposed for Levy County carry an estimated price tag of $17 billion.

Sipes reported receiving CEAC comments on both sides of the nuclear issue. Nathan Ramsey spoke in favor of keeping nuclear on the table. In his view, the seriousness of climate change argues against blanket rejection of any method for electrical generation. Nuclear opponents on the council considered the announcements a step in the wrong direction. To assuage them, Sipes said adding on to Shearon Harris “isn’t a foregone conclusion.” A final decision isn’t likely until next year.

As evidence of the company’s willingness to pursue other avenues, Sipes cited hundreds of millions of dollars of investment in alternative generation, efficiency programs etc. Council members highlighted the disparity between $17 billion for new nukes in Florida and the companywide funds committed to alternatives. Sipes admitted the escalating price of nuclear power and said it’s possible the friendly atom will price itself out of the market. “You’d better believe that if there’s a more cost effective method out there, we’ll use it,” he said.

Richard Fireman jumped in; “To say that the free market will make the right choices is absurd. The market has made the wrong choices. That’s why we have a climate crisis.” Cape said, “The free market isn’t making the choice when decisions are subsidized. It’s not the free market if North Carolina customers prepay for [a nuclear plant.]” Hollister added, “Nuclear power wouldn’t exist at all if it had to insure itself.”

Cape, recognizing that some in the room doubted the magnitude of savings possible through conservation and efficiency, suggested bringing in a speaker from Austin Energy. That Texas municipal utility has already realized a 600 MW savings and is on track for 1200 MW. Austin Energy serves a customer base about three times as large as Progress’s WNC territory. By way of further comparison, the entire generation capacity at Lake Julian is 711 MW. Actual production is considerably less.

If action was taken on Cape’s suggestion, I missed it.

A Pleasant Interlude
Sipes moved on to less contentious topics. Progress has joined The Climate Registry, a voluntary North and Central American system for reporting greenhouse gas emissions. Progress will account to that body for all direct and indirect greenhouse gases. The company is also filing with the UC for a “Smart Grid” in North Carolina. Sipes said this will better allow the incorporation of distributed [third-party] generation systems.

Martha Thompson and Meares reported that the CEAC subcommittee working on community grants is close to making its first awards. Fourteen applications for parts of the available $25,000 were received. Applications were judged on adherence to published criteria and on projected community, environment, and economic impacts.

The CEAC statement of Guiding Values was finally, I think, agreed to. Several members underlined the importance of the bullet point to, “Advocate for a community-wide conservation ethic.” Public education campaigns, they said, are of paramount importance.

Whither the February Recommendations?
CEAC facilitator Steve Cochran presented an overview of next steps regarding the recommendations the council produced in February. In essence, these are being converted to 25 actionable projects. They will be the subject of a company meeting in Raleigh on March 28th. Projects will emerge with goals, responsible people, and measurable attributes attached. These will be presented to CEAC.

Questions linger from environmentalists and CEAC members across the interest spectrum about the council’s actual role in WNC’s energy future. Sipes always handles the group with care and positive regard. But signals from the Progress boardroom, amply demonstrated this month, are decidedly mixed. Is CEAC a serious company effort to begin reinventing itself for an energy economy focused on efficiency and distributed generation rather than centralized power plants? Or is the council more about public relations, a greenwashing strategy to improve the palatability of business as usual? A comparison of CEAC’s February recommendations with the projects Progress derives from them may provide some telling answers.

 —Michael Hopping
Copyright © 2008 all rights reserved
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