Is CPS cooking the books for nuclear power
September 30, 2009
How much does efficiency cost? Depends on who you ask.
By Greg Harman
San Antonio Current
Most Texas homes weren't built as if energy mattered. Despite 100-degree summer days, our roofs are still covered in heat-absorbing black-tar shingles. Cheap insulation in the attic, leaky doors, and single-paned windows mean when the air conditioner runs, it runs loads of cooled air right out the house.
San Antonio's CPS Energy plans to spend $850 million to eliminate 771 megawatts of wasteful energy consumption through weatherization programs and rebates to help residential and commercial customers replace lights and appliances, and hoist solar panels onto their roofs by 2020. To do that will cost roughly $1,100 per saved kilowatt, according to the utility.
However, 80 miles to the northeast, municipally owned Austin Energy has already cut 800 megawatts through energy efficiency over the last 20 years at a cost of roughly $350 per kilowatt, said Scott Jarman, consulting engineer with Austin Energy's efficiency program. But after 20 years of efficiency work, the savings are increasingly hard to find, and accordingly, more costly.
"At some point you would tend to think the incremental improvements are going to slow down, there's bound to be some technological limit, or economic limit," Jarman said. "We've been sort of trying to prime management that the more you dig, the more it's going to cost ... because we've already got a lot of the older technology out."
In fact, an outside consultant, Pace Consulting Group, expects future efficiency savings in Austin to run a bit higher - between $500 to $781 per kilowatt.
CPS, meanwhile, holds to the numbers provided by Nexant, its most recent efficiency consultant. Early results showed CPS was able to eliminate 40 megawatts of local power use at a cost of $11.5 million, or $287 per kilowatt, but that's an example of tackling the cheapest "low-hanging fruit," said Cris Eugster, CPS's sustainability officer. In that case, the savings were found through a CFL rebate program offered in partnership with H-E-B, a program Eugster said is about to be retired. Efficiency costs will ramp up noticeably when planned low-income weatherization programs - a full 20 percent of CPS's STEP program - are up and running.
"The early years are kind of low numbers like that ... [but] within 10 years you're going to have to pay more if you are going to do an incentive system," Eugster said.
Eugster had no immediate rebuttal to Austin Energy's numbers.
"If Austin's got some great ideas," he said, "we're all about sharing perspectives."
The disparity in CPS Energy's numbers are apparent in other areas, as well. On a single-page comparison of alternatives to nuclear power released by CPS, the utility priced solar - specifically a trough system with energy-storage capacity - at 21-cents per kilowatt hour. Critics complain the utility didn't bother to price out more promising solar options. The U.S. Bureau of Land Management, for instance, is currently fast-tracking a variety of utility-scale solar projects that some proponents suggest may deliver solar power with natural-gas backup for as low as 7 cents per kilowatt hour, nearly 2 cents cheaper than CPS's nuclear-power cost projection.
Similarly, CPS estimates the cost of natural gas at $8.60 per million Btu, but they appear to be using last year's numbers. Natural-gas prices plummeted to $4.36 this year thanks to major new domestic finds.
"The world changed dramatically in the last year, and CPS didn't because they were in the middle of shoveling millions of dollars into nuclear," says Craig Severance, a certified public accountant and clean-energy advocate.
Even in 2020, the Energy Information Agency estimates the cost for the commodity will be less than CPS's current projection. According to Paul Hesse, information specialist at the EIA, the projected 2020 figure for a million Btu of natural gas is $6.61. Factoring in the expected cost of inflation, however, raises that estimate to $8.40. However, should the Waxman-Markey climate bill being debated in Congress pass, costs for natural gas will eclipse CPS's figure by about 60 cents, settling at $9.17.
Cyrus Reed, conservation chair for the state Sierra Club, has been studying and comparing the various numbers being used in Austin and San Antonio for months and is recommending natural gas as a "bridge fuel" to help both cities get off coal and nuclear power.
"It should be used when the wind isn't blowing and the sun isn't shining," Reed said. "It's flexible. You can run it when you need it."
For the same $5.2 billion dollars San Antonio is poised to invest in 1,080 megawatts of nuclear, Reed's research suggests the city could develop more than 2,500 megawatts of efficiency, natural gas, and non-polluting renewable power.
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