In this interview, David Eves, President and CEO of Public Service Company of Colorado, the Xcel Energy Company based in Colorado, provides a roadmap of smart grid and renewable energy initiatives will take over the course of the next couple years.
Full Transcription:
Justin Segall: Justin Segall for the Daily Energy Report here with David Eves, President and CEO of Public Service Company of Colorado, the Xcel Energy Company here in Colorado. Mr. Eves thanks for taking some time to sit with us. Today you spoke of a lot about the things that you guys have been doing around smart grid, with the pilot in Boulder and around demand side management with the $200-300M that you’re spending. Going forward. Can you talk to me about what you see are your top priorities over the next three years.
David Eves: There are priorities on different fronts. On the supply mix, priority is implementing the rest of our resource plan, bringing more wind projects on-line; the Clean Air/Clean Jobs coal program with replacing about 900MW of coal fire generation with new gas fire protection facility; some new state-of-the-art emission controls on Pawnee and Hayden. We’re kind of re-tooling, that’s a lot of investment in our production fleet. That’s one track. Another track is building transmissions to the renewable zones of the state. Another track is energy efficiency. The $200-300M I talked about was for all of Xcel. We do a little less than a $100M in Colorado, but that’s growing, increasing goals every year. Then the SmartGrid City– it’s really a matter of trying to work with other business partners and see if we can move the ball forward with in-home devices and get to a point we can help customers get and use this information to better manage their energy use and make the choices they want make.
Justin Segall: You’ve mentioned in one of your questions was, “Where is the iPhone app? What can I do?” What would you like to see in terms of what other things get developed? How would you like to see your customers engaging with SmartGridCity?
David Eves: Half of what we set out to prove or study at SmartGridCity was upstreaming the meter, and who’s on our distribution system. And we know that, out of the thirty or forty things that we look at on the grid, that it’s going to make sense to do things in the future on the rest of our grid, and probably for other utilities that a lot may have predicted failure of equipment, and all those kind of things. So, that part, I think we’re at the point of commercializing that and start to roll it out into the rest of our territory. In-home and with customer information, that’s more challenging. We’re having trouble finding the in-home devices. It’s not something that we personally developed. We need to partner with other companies that could bring that technology. And we can change our pricing to reflect hourly cost changes or time of day cost differences. But there are ways to go to get into a point where it’s customer friendly and easy to use like most of the apps I use in my phone.
Justin Segall: You focused on the benefits that SmartGridCity has had in terms of the T&D and on the generation side. I think that maybe that has not been captured or as well understood by the general public because it’s something that’s harder to understand. How would you characterize that benefit? What would you say is the biggest win that has come out of SmartGridCity from the T&D side?
David Eves: A lot of different applications or value propositions we looked at, it all kind of rolled into a reliability bucket: If we can predict when a transformer is going to overload; If we can automatically switch once we know customers are out, we can restore service to most, sometimes all those customers; Before throwing the truck, we could have a field personnel that could show up to do the switching. Those kinds of things are great benefits. Our average customer experiences a little over an hour of outage a year, somewhere around 70 minutes per year on average. Most of that comes from the operations of our distribution lines. If we can cut that by 20% or 30% or 40%, that’s a big improvement in the overall reliability downtime for customers or the number of outages they experience. So that’s probably one that’s real beneficial. The second major benefit back on the grid would be managing voltage instead of majoring at one point, controlling voltage on a feeder. If we can major the multiple points and control it in a more sophisticated way the way we do a motor now, we’ll actually be able to reduce the losses on our system. And maybe if we can reduce the energy use of our customers, we can give them too much voltage.
Justin Segall: In those learnings, do you intend to roll smart grid out to the rest of your service territory in Colorado?
David Eves: I think a lot of the applications, the benefits, will come out and will be deployed across the rest of our system. You won’t see a one giant leap forward with all of them at once. We find the most cost-effective, opportunistic areas to do certain kinds of distribution automation or DVO like voltage optimization or other applications.
Justin Segall: Some of the other utilities that we’ve heard from today, they’ve talked about that they are doing a full roll-out. Every meter within their customer base will be switched to AMI. Why are you not pursuing that path?
David Eves: I think the full roll-out, I like the way that you describe that. It’s really AMI. It’s not smart grid to actually automate the operation of the distribution system as well as the smart meter and the interface of the customer. It’s a more comprehensive approach that we took in Boulder. We already are committed on automatic meter reading (AMR) and significantly we were able to save cost for customers. The economics of a full scale, across the board deployment with new smart meters, probably isn’t economic yet. Part of what I would say about that though is it’s really important to have the applications, the tools, the customer-friendly, user-friendly– I think we’re going to have more companies from all the different players in the industry that can create that app that’s easy to use or the in-home devices that are customer-friendly. As that happens, then the smart meter provides a lot of value to
customers and it will make sense to put it in.
Justin Segall: Last question for you on solar and solar rebates, that’s certainly been a hot topic here in Colorado this year, and in Xcel’s plans with the solar rebate program and the legislature’s actions around it, what do you see is the future for solar in Colorado and how will Xcel be part of that?
David Eves: I see it is continuing. We really want to support the industry continuing to help our customers who want to install solar get it installed. Clearly, we over-achieved – not just the company, but frankly all the solar industry. We reach forward and kind of hit 2017-18 type compliance requirement. We’ll be there in 2012. We need to balance the fact that all of our customers are paying that 2% more in order to fund those rebates and those exams. I think it’s really important for us to tee up for the commission of all the other parties to look at this and say, “What is the right balance?” Should Xcel be reducing the 2% surcharge or should we blow past and dramatically exceed the Renewables Standard? Or where in between should we be? And that’s something as a matter of public policy, and we’re glad we’ve been in the position. It’s kind of a nice problem to have.
Justin Segall: Absolutely. Mr. Eves thanks so much for your time.
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