CPS must die

Why SA's utility is not only wrong on nukes but putting your future at risk

By Greg Harman

October 24, 2007

Screaming temps and cranked ACs in April '06 caught state utilities with their plants down. Several units were offline for maintenance when boiling mercury unexpectedly reached a record-setting 101. Others flat-out failed.

In Dallas, Austin, Houston, and San Antonio, utilities started rolling timed blackouts to keep the power grid from scorching. Police hit the street to direct disorientated travelers. In the end, Texas avoided pandemonium akin to the Northeast Blackout of 2003, when millions across eastern Canada and the U.S. were left powerless. But a few months later, brutal temperatures in Europe made it impossible to cool discharge from nuclear power plants to safe levels, leading utilities to cut power even as the heat-related death count rose.

Rising global temperatures and increasing energy demand are expected to bring even worse conditions in the coming years. San Antonio's CPS Energy anticipates local demand will outpace supply as soon as 2016 - even with 190 megawatts of new gas power at Braunig Lake coming online in 2009 and a new coal plant, the Spruce 2, tying in its 750-megawatt load in 2010. Already we've starting to cross the 12.5-percent surplus buffer most utilities maintain as insurance against the unexpected.

At the state level, keeping up with growth hinges on new coal plants going online by 2009, according to the Electric Reliability Council of Texas. ERCOT predicts energy demand could regularly exceed supply as soon as 2012. Such a course could lead to a threatening gulf of 85 megawatts by 2027. Considering each megawatt can power about 400 homes for a year, 85 missing mega pose a major problem.

As if the sheer magnitude of a coming power crush weren't enough to wet the sheets of any good-hearted control operator, a squad of Texas A&M scientists is releasing a book later this month that says Global Warming will showcase its nastier side in South Texas. The Changing Climate of South Texas, featured by the Current in July, is expected not only to bring more intense flooding and prolonged drought to this vulnerable region, but spike average temps by up to 7 degrees in coming decades. A growing portion of the energy community has also taken to heart predictions that the world is over - or is in the process of passing - its "peak" petroleum reserves, not an insignificant threat to modern petro-civilization in its own right.

With so much aligning against us, you would think that City Hall would be doing everything within its power to prepare residents of one of the most vulnerable parts of the country for the gathering storm. You'd be wrong. Instead of scrambling to enhance the security of our communities by ramping up energy efficiency and "decentralized" power-generating programs to make sure we all have the power we need in the event of an emergency, CPS Energy board members are expected Monday to launch San Antonio into the fore of the so-called nuclear-energy revival with only the haziest notions of the risks - and the costs - involved.

Power Lusting

Texas, as you know, is a power-hungry state. Take that as you will.

Pundits yet to be molded will forge careers weighing our appreciation of raw political swagger with our almost sensual affliction for crude. So smitten, we were guiltily guzzling the black stuff while the greens - those infinitely farmable non-polluters - went untouched.

Collectively, Texas eats more energy than any other state, according to the U.S. Department of Energy. We're fifth in the country when it comes to our per-capita energy intake - about 532 million British Thermal Units per year. A British Thermal Unit, or Btu, is like a little "bite" of energy. Imagine a wooden match burning and you've got a Btu on a stick. Of course, the consumption is with reason. Texas, home to a quarter of the U.S. domestic oil reserves, is also bulging with the second-highest population and a serious petrochemical industry.

In recent years, we managed to turn ourselves into the country's top producer of wind energy. Despite all the chest-thumping that goes on in these parts about those West Texas wind farms (hoist that foam finger!), we are still among the worst in how we use that energy. Though not technically "Southern," Texans guzzle energy like true rednecks. Each of our homes use, on average, about 14,400 kilowatt hours per year, according to the U.S. Energy Information Administration. It doesn't all have to do with the A/C, either. Arizonans, generally agreed to be sharing the heat, typically use about 12,000 kWh a year; New Mexicans cruise in at an annual 7,200 kWh. Don't even get me started on California's mere 6,000 kWh/year figure.

Let's break down that kilowatt-hour thing. A watt is the energy of one candle burning down. (You didn't put those matches away, did you?) A kilowatt is a thousand burnin' candles. And a kilowatt hour? I think you can take it from there.

We're wide about the middle in Bexar, too. The average CPS customer used 1,538 kilowatt hours this June when the state average was 1,149 kWh, according to ERCOT. Compare that with Austin residents' 1,175 kWh and San Marcos residents' 1,130 kWh, and you start to see something is wrong.

So, we're wasteful. So what?

For one, we can't afford to be. Maybe back when James Dean was lusting under a fountain of crude we had if not reason, an excuse. But in the 1990s Texas became a net importer of energy for the first time. It's become a habit, putting us behind the curve when it comes to preparing for that tightening energy crush.

We all know what happens when growing demand meets an increasingly scarce resource - costs go up. As the pressure drop hits San Anto, there are exactly two ways forward. One is to build another massively expensive power plant. The other is to transform the whole frickin' city into a de-facto power plant, where energy is used as efficiently as possible and blackouts simply don't occur.

CPS has opted for the Super Honkin' Utility model. Not only that - quivering on the brink of what could be a substantial efficiency program, CPS took a leap into our unflattering past when it announced it hopes to double our nuclear "portfolio" by building two new nuke plants in Matagorda County. The utility joined New Jersey-based NRG Energy in a permit application that could fracture an almost 30-year moratorium on nuclear power plant creation in the U.S.

"It's pretty shameful," said Genaro Rendon, director of the Southwest Worker's Union, one of about eight protestors who gathered last month outside CPS Energy's downtown offices. "I'm even embarrassed to mention it to people that are from out of the state and out of the city."

Though a second small protest brought about 20 to City Hall last week, the shame hasn't gone mainstream. After all, CPS's poor choices haven't shown up in the monthly bill yet. What the utility is tasked with, providing "low-cost competitive electric power," it does resoundingly well. San Antonio residents continue to enjoy some of the lowest rates in the state, even as deregulation and heavy investments in natural gas - thought to be a saving grace in the 1990s - have inflated rates more than 50 percent in some areas. It's hard to riot when the belly is full. Or, as one state energy expert put it, protests gather steam "because the bills are high, not because the child has asthma."

There is also the matter of trust. If the state says we're desperate for power plants, we assume they're telling the truth. When CPS says nukes are the way out of the crush, we accept it, knowing there are few options. Yeah, we're suckers like that.

Choosing Nukes

Granted, CPS didn't just pull nukes out of a hat when it went looking for energy options.

CEO Milton Lee may be intellectually lazy, but he's not stupid. Seeking to fulfill the cheap power mandate in San Antonio and beyond (CPS territory covers 1,566 square miles, reaching past Bexar County into Atascosa, Bandera, Comal, Guadalupe, Kendall, Medina, and Wilson counties), staff laid natural gas, coal, renewables and conservation, and nuclear side-by-side and proclaimed nukes triumphant. Coal is cheap upfront, but it's helplessly foul; natural gas, approaching the price of whiskey, is out; and green solutions just aren't ready, we're told. The 42-member Nuclear Expansion Analysis Team, or NEAT, proclaimed "nuclear is the lowest overall risk considering possible costs and risks associated with it as compared to the alternatives."

Hear those crickets chirping?

NEAT members would hold more than a half-dozen closed-door meetings before the San Antonio City Council got a private briefing in September. When the CPS board assembled October 1 to vote the NRG partnership up or down, CPS executives had already joined the application pending with the U.S. Nuclear Regulatory Commission. A Supplemental Participation Agreement allowed NRG to move quickly in hopes of cashing in on federal incentives while giving San Antonio time to gather its thoughts. That proved not too difficult.

Staff spoke of "overwhelming support" from the Citizen's Advisory Board and easy relations with City staff.

"So far, we haven't seen any fatal flaws in our analysis," said Mike Kotera, executive vice president of energy development for CPS.

With boardmember and Mayor Phil Hardberger still in China inspecting things presumably Chinese, the vote was reset for October 29.

No one at the meeting asked about cost, though the board did request a month-by-month analysis of the fiasco that has been the South Texas Project 1&2 to be delivered at Monday's meeting.

When asked privately about cost, several CPS officers said they did not know what the plants would run, and the figure - if it were known - would not be public since it is the subject of contract negotiations.

"We don't know yet," said Bob McCullough, director of CPS's corporate communications. "We are not making the commitment to build the plant. We're not sure at this point we really understand what it's going to cost."

The $206 million outlay the board will consider on Monday is not to build the pair of 1,300-megawatt, Westinghouse Advanced Boiling Water Reactors. It is also not a contract to purchase power, McCullough said. It is merely to hold a place in line for that power.

"It's likely that we would come on a recurring basis back to the board to keep them apprised of where we are and also the decision of whether or not we think it makes sense for us to go forward," said Larry Blaylock, director of CPS's Nuclear Oversight & Development.

So, at what point will the total cost of the new plants become transparent to taxpayers? CPS doesn't have that answer.

"At this point, it looks like in order to meet our load growth, nuclear looks like our lowest-risk choice and we think it's worth spending some money to make sure we hold that place in line," said Mark Werner, director of Energy Market Operations.

Another $10 million request for "other new nuclear project opportunities" will also come to the board Monday. That request summons to mind a March meeting between CPS officials and Exelon Energy reps, followed by a Spurs playoff game. Chicago-based Exelon, currently being sued in Illinois for allegedly releasing millions of gallons of radioactive wastewater beneath an Illinois plant, has its own nuclear ambitions for Texas.

South Texas Project

The White House champions nuclear, and strong tax breaks and subsidies await those early applicants. Whether CPS qualifies for those millions remains to be seen. We can only hope.

Consider, South Texas Project Plants 1&2, which send us almost 40 percent of our power, were supposed to cost $974 million. The final cost on that pair ended up at $5.5 billion. If the planned STP expansion follows the same inflationary trajectory, the price tag would wind up over $30 billion.

Applications for the Matagorda County plants were first filed with the Atomic Energy Commission in 1974. Building began two years later. However, in 1983 there was still no plant, and Austin, a minority partner in the project, sued Houston Power & Lighting for mismanagement in an attempt to get out of the deal. (Though they tried to sell their share several years ago, the city of Austin remains a 16-percent partner, though they have chosen not to commit to current expansion plans).

After Unit 1 came online in 1988, it had to be shut down after water-pump shaft seared off in May, showering debris "all over the place," according to Nucleonics Week. The next month two breakers failed during a test of backup power, leading to an explosion that sheared off a steam-generator pump and shot the shaft into the station yard. After the second unit went online the next year, there were a series of fires and failures leading to a half-million-dollar federal fine in 1993 against Houston Power.

Then the plant went offline for 14 months. Not the glorious launch the partnership had hoped for.

Today, CPS officials still do not know how much STP has cost the city, though they insist overall it has been a boon worth billions.

"It's not a cut-and-dried analysis. We're doing what we can to try to put that in terms that someone could share and that's a chore," said spokesman McCollough.

CPS has appealed numerous Open Records requests by the Current to the state Attorney General. The utility argues that despite being owned by the City they are not required to reveal, for instance, how much it may cost to build a plant or even how much pollution a plant generates, since the electricity market is a competitive field.

Even without good financial data, the Citizen's Advisory Board has gone along with the plan for expansion. The board would be "pennywise and pound foolish" not to, since the city is already tied to STP 1&2, said at-large member Jeannie O'sullivan.

"Yes, in the past the board of CPS had been a little bit not as for taking on a [greater] percentage of nuclear power. I don't know what their reasons were, I think probably they didn't have a dialogue with a lot of different people," O'sullivan said.

Or maybe they talked to MIT.

A 2003 study at the Massachusetts Institute of Technology estimates the cost of nuclear power to exceed that of both coal and natural gas. A U.S. Energy Information Administration report last year found that will still be the case when and if new plants come online in the next decade.

If ratepayers don't pay going in with nuclear, they can bet on paying on the way out, when virtually the entire power plant must be disposed of as costly radioactive waste. The federal government's inability to develop a repository for the tens of thousands of tons of nuclear waste means reactors across the country are storing spent fuel in onsite holding ponds. It is unclear if the waste's lethality and tens of thousands of years of radioactivity were factored into NEAT's glowing analysis.

The federal dump choice, Nevada's Yucca Mountain, is expected to cost taxpayers more than $60 billion. If it opens, Yucca will be full by the time STP 3&4 are finished, requiring another federal dump and another trainload of greenbacks.

Just the cost of Yucca's fence would set you back. Add the price of replacing a chain-link fence around, let's say, a 100-acre waste site. Now figure you're gonna do that every 50 years for 10,000 years or more. Security guards cost extra.

That is not to say that the city should skip back to the coal mine. Thankfully, we don't need nukes or coal, according to the American Council for an Energy-Efficient Economy, a D.C.-based non-profit that champions energy efficiency.

A collection of reports released this year argue that a combination of ramped-up efficiency programs, construction of numerous "combined heat and power" facilities, and installation of on-site renewable energy resources would allow the state to avoid building new power plants. Texas could save $73 billion in electric generation costs by spending $50 billion between now and 2023 on such programs, according to the research group. The group also claims the efficiency revolution would even be good for the economy, creating 38,300 jobs. If ACEEE is even mostly right, plans to start siphoning millions into a nuclear reservoir look none too inspired.

To jump tracks will take a major conversion experience inside CPS and City Hall, a turning from the traditional model of towering plants, reels of transmission line, and jillions of dependent consumers. CPS must "decentralize" itself, as cities as close as Austin and as far away as Seattle are doing. It's not only economically responsible and environmentally sound, but it is the best way to protect our communities entering what is sure to be a harrowing century.

Greening CPS

CPS is grudgingly going greener.

In 2004, a team of consultants, including Wisconsin-based KEMA Inc., hired to review CPS operations pegged the utility as a "a company in transition." Executives interviewed didn't understand efficiency as a business model. Even some managers tapped to implement conservation programs said such programs were about "appearing" concerned, according to KEMA's findings.

While the review exposed some philosophical shortcomings, it also revealed for the first time how efficiency could transform San Antonio. It was technically possible, for instance, for CPS to cut electricity demand by 1,935 megawatts in 10 years through efficiency alone. While that would be accompanied with significant economic strain, a less-stressful scenario could still cut 1,220 megawatts in that period - eliminating 36 percent of 2014's projected energy use.

CPS's current plans call for investing $96 million to achieve a 225-megawatt reduction by 2016. The utility plans to spend more than four times that much by 2012 upgrading pollution controls at the coal-fired J.T. Deely power plant.

In hopes of avoiding the construction of Spruce 2 (now being built, a marvel of cleanliness, we are assured), Citizen Oversight Committee members asked KEMA if it were possible to eliminate 500 megawatts from future demand through energy efficiency alone. KEMA reported back that, yes, indeed it was possible, but would represent an "extreme" operation and may have "unintended consequences." Such an effort would require $620 million and include covering 90 percent of the cost of efficiency products for customers.

But an interesting thing happens under such a model - the savings don't end in 2012. They stretch on into the future. The 504 megawatts that never had to be generated in 2012 end up saving 62 new megawatts of generation in 2013 and another 53 megawatts in 2014. With a few tweaks on the efficiency model, not only can we avoid new plants, but a metaphorical flip of the switch can turn the entire city into one great big decentralized power generator.

New Model Army

So, how does it happen? How do we usher in this new utopia of decentralized power?

First, we have to kill CPS and bury it - or the model it is run on, anyway. What we resurrect in its place must have sustainability as its cornerstone, meaning that the efficiency standards the City and the utility have been reaching for must be rapidly eclipsed.

Not only are new plants not the solution, they actively misdirect needed dollars away from the answer. Whether we commit $500 million to build a new-fangled "clean-coal" power plant or choose to feed multiple billions into a nuclear quagmire, we're eliminating the most plausible option we have: rapid decentralization.

For this, having a City-owned utility offers an amazing opportunity and gives us the flexibility to make most of the needed changes without state or federal backing.

"Really, when you start looking, there is a lot more you can do at the local level," said Neil Elliott of the ACEEE, "because you control building codes. You control zoning. You can control siting. You can make stuff happen at the local level that the state really doesn't have that much control of."

One of the most empowering options for homeowners is homemade energy provided by a technology like solar. While CPS has expanded into the solar incentives field this year, making it only the second utility in the state to offer rebates on solar water heaters and rooftop panels, the incentives for those programs are limited. Likewise, the $400,000 CPS is investing at the Pearl Brewery in a joint solar "project" is nice as a white tiger at a truck stop, but what is truly needed is to heavily subsidize solar across the city to help kickstart a viable solar industry in the state. The tools of energy generation, as well as the efficient use of that energy, must be spread among the home and business owners.

Joel Serface, with bulb-polished pate and heavy gaze, refers to himself as a "product of the oil shock" who first discovered renewables at Texas Tech's summer "geek camp." The possibilities stayed with him through his days as a venture capitalist in Silicon Valley and eventually led him to Austin to head the nation's first clean-energy incubation center.

Serface made his pitch at a recent Solar San Antonio breakfast by contrasting Texas with those sun-worshipping Californians. Energy prices, he says, are "going up. They're not going down again." That fact makes alternative energies like solar, just starting to crack the 10-cent-per-killowatt barrier, financially viable.

"The question we have to solve as an economy is, 'Do we want to be a leader in that, or do we want to allow other countries [to outpace us] and buy this back from them?'" he asked.

To remain an energy leader, Texas must rapidly exploit solar. Already, we are fourth down the list when it comes not only to solar generation, but also patents issued and federal research awards. Not surprisingly, California is kicking silicon dust in our face.

Still, local interest in renewables has begun to swell. So has the base of knowledgeable contractors. Anita Ledbetter, director of the Metropolitan Partnership for Energy, used to know every Alamo-based efficiency bug before it sprung. But now, she says, there is just too much happening to keep up. That's a good thing.

Austin Energy, one of the country's most progressive utilities, saved 690 megawatts of energy through efficiency programs last year. Of course it benefits from a conservation-minded public and a City government that made cost-effective conservation its first priority in meeting energy demand back in 1999. More recently, the Austin Council committed to powering all City buildings with 100-percent renewables by 2020.

"Decentralized power is what we are moving toward," said Frank Yebra, Austin Energy's director of Demand Side Management.

There is a way for San Antonio to reach that destination, too.

Remember those KEMA projections? An interesting thing about them is they don't include solar in their analysis. The study was limited to swapping out bad appliances for good, reflective roofs, and more efficient air conditioning and lighting

While CPS buys its way to 8.6-percent renewable supply, it is solar - as well as other "micro-power" options not discussed by KEMA - that offer benefits conservation can't. Not only do such sources produce power, they produce it where it is used, within homes and businesses. As Russell Smith, executive director of the Texas Renewable Energy Industries Association, tells us, "There is no silver bullet. But what we do have is silver buckshot. And that's what we're gonna need."

So take those KEMA numbers and factor in a modest solar array, for instance, on just 10 percent of our homes. Place on a roof one of the smallest single-kilowatt systems, which generate (according to CPS's website) about 1,600 kilowatts each year. Multiply that by 67,000 homes (10 percent of CPS's 677,000 customers) and we've saved another 7.2 megawatts.

If half our homes had a single-kilowatt array, we'd cut out more than 540 megawatts and be delivering as much power as a state-of-the-art coal-fired power plant.

At current market rates (roughly 10 grand installed), 67,000 solar arrays would run $677,000 - a dollar per utility customer. Surely there's a good bulk order rate out there.

Partnered with the aggressive conservation savings projected by KEMA's economic model (1,240 megawatts in 10 years), San Antonio could be powering 870,000 homes before the nuke plants go online.

Last Rites

Google "energy security" and you're likely to wind up at the Energy Information Administration website where I got some of the first statistics for this article. There you can learn a good bit about oil-pipeline explosions and spills, nuclear reactor leaks, and international natural-gas price fluctuations.

Increasingly, energy security has come to mean a lot more than keeping terrorists off the pipeline. It's become a buzzword for using local energy resources. You know, American energy, from America, one of the few remaining countries that still loves Americans! It doesn't involve Russian-made nuclear fuel or another Operation Iraqi Liberation. Simple.

At CPS, a motto holds that "Nothing is Simple." However, some truths remain so. If and when the next super-storm arrives, a decentralized model means the majority of our neighbors will be able to survive without power from Matagorda County or Spruce 2. And if the worst we ever see is a doubling of oil prices, decentralization wins on dollars alone. But as CPS's application for more nuke drove home last month, to get there we'll have to break out the shovels and bury a dangerously archaic utility first.(*)

* Originally reported as $1 per customer. Corrected 10/25/07

*This story originally reported that $67,000 solar arrays at $10,000 would cost $677,000, or $1 per utility customer. The actual cost for $67,000 arrays would be $670,000,000, or $990 per customer.


Advanced Boiling Water Reactors

Twin 1,300-megawatt Westinghouse Advanced Boiling Water Reactors proposed for the South Texas Project grounds could be the first new nuclear plants approved in the country in 30 years. But they don't represent the latest or greatest nuke technology.

ABWRs first went online in 1996 in Kushiwazaki Japan at the world's largest nuclear power plant. The site may sound familiar: after being taken offline for several months following all-too-common data-falsification scandals, a 6.8 earthquake this year caused a fire at the ABWR, which then flushed a "tiny" amount of radioactive fluids into the Sea of Japan before the complex was shut down. It will likely be a year before it's up and running again.

"The technology was a bit of a surprise to [the U.S. Nuclear Regulatory Commission] early on," a CPS rep said of their joint application with NRG Energy. "They had been aiming at even newer technologies and this one that has actually been built is a sound decision, but because of the timing they had to rearrange their staffing to support - the licensing of the ABWR technology."

According to General Electric, the ABWR offers lower operation and maintenance costs and short construction times. The fact that the design is already certified in the United States also played a role in NRG's choice.


What is efficiency?

Efficiency is walking five steps instead of 20 and still getting your double caramel latte. Or paying $30 each month to run that window AC unit instead of $90. Essentially, it's using less energy to get the same return.

All the debate about more fuel-efficient cars as the per-barrel price of oil danced over the record-setting $90-per-barrel figure is justified - especially when you realize that 60 percent of the gas you buy is used up by the engine struggling to convert that gas into power. That only about 13 percent of what's left is used to turn the tires.

If you want to know what more efficient energy use can do for our economy, it is almost better to ask, "What is inefficiency?"

Consider that in Texas we used 1,669 trillion Btu of energy in 2004 to create and transport a mere 749 Btu of electricity to homes and businesses. Though that ratio of energy production to energy loss is not atypical in the U.S., it does show how much energy can be rescued if we make it a priority.

And if you are wondering how we dropped your AC bill by $60, it's time you learned about simple things like double-paned windows, insulation, and caulk, able to cut most bills in half for a small investment.

Article appeared in The San Antonio Current

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