Communities and businesses are plugging into this other kind of power more and more every day. They're benefiting from the presence of utilities owned and operated by the communities they serve - municipal utilities as well as regional and statewide counterparts. More than 40 million Americans get their power this way, from more than 2,000 not-for-profit electric utilities.
It almost goes without saying that part of the benefit is a generally lower cost for energy. But that's just the beginning. Public power providers also boast extra-solid reliability, plus a strong commitment to community improvement and economic development. Alan Richardson, president and CEO of the American Public Power Association, alluded to this broader purpose in a recent speech: "We exist to serve the public interest, and our goal is to create a better society."
Developing Their Communities
A cornerstone for a better society is prosperity, which is why so many public power organizations are involved in economic development and business assistance. Take the Sacramento Municipal Utility District - commonly known as SMUD - as an example.
"We have a multifaceted economic development program at SMUD," says J.D. Stack, the utility's economic development program manager. "We do a bunch of different things, ranging from corporate recruitment to small-business assistance. We even do small-business loans and entrepreneurial assistance, helping people form and grow new companies."
One such program is the Grow Sacramento Fund, a business loan program. The fund's purpose is to create or retain jobs and to assist energy-related businesses. Loans are guaranteed through the U.S. Small Business Administration and are open to nearly any for-profit business, including manufacturers, retailers, and service companies. Loans range from $25,000 to $1 million.
"We are the lead contributor to a business incubator in the Sacramento area that offers a set of services to budding entrepreneurs," Stack continues. "And this year we became the lead contributor to a new program targeted at clean-energy entrepreneurs."
The CleanStart program to which he refers focuses on businesses pursuing everything from solar power to fuel cells to energy efficiency. Recently completed was the "PowerUp!" business-plan competition that awarded $50,000 in cash prizes to promising new-business proposals from an entry pool of more than 20. "Every one of those groups was matched with mentors, and they're still getting assistance from the mentors," Stack adds.
Ultimately, organizers hope to foster new locally based, high-growth companies. "California has already had a big role in incorporating new energy technologies, and because of our position as the state capital, we feel there are opportunities to build on that track record and grow clean-energy businesses," Stack explains.
Yes, SMUD does sell electricity, but powering up the local economy is all in a day's work, too, according to Stack. "Our entire economic development program is about making sure we have a vibrant and growing business community in the Sacramento region. All activities we get involved in support that."
Across the continent, the Tennessee Valley Authority is also heavily involved in economic development activities, according to its senior vice president of economic development, John Bradley. As with SMUD, economic development is woven into the fabric of the organization, which in this case was originally formed to help bring prosperity back to the Depression-ravaged Tennessee Valley. "Basically, the TVA has in its mission economic development and improving the quality of life of the people who live within the valley. We help retain and attract jobs," Bradley says.
What he oversees is "a full-service economic development organization, with a recruitment function, an existing-business function, a community-development function, and a technical-services function," he says. "We even have engineers on staff who help with such things as site-development planning."
A prominent new TVA venture into economic development is its "megasite" program, launched in 2004 to identify parcels of land that would be suitable places for automotive manufacturing operations. "We've hired a consulting firm to basically do the due diligence to prepare larger tracts for the automotive industry. It's really community preparedness," he explains.
A prominent site-search firm has been given the task of making personal visits and gathering information to evaluate 25 potential "megasites" from around the Tennessee Valley. Seven such sites have been certified thus far, including the I-40 Advantage Auto Park site in Haywood County, Tennessee; the West Tennessee Auto Park in Crockett County, Tennessee; Industrial Park South in Chattanooga, Tennessee; Lowndes County Crossroads near Columbus, Mississippi; Lowndes County-Golden Triangle, also near Columbus, Mississippi; PUL Alliance-Wellspring Project in Tupelo, Mississippi; and the Hopkinsville-Christian County-Interstate 24 megasite in Kentucky.
TVA spends a lot of time in business recruitment as well, Bradley says, focusing on a range of target industries including automotive, distribution and warehousing, food processing, cold storage, life sciences, and plastics. "We have individuals out there on a day-to-day basis selling the TVA region. They make cold calls and go to trade shows. They're truly recruiters," he notes.
The organization also pays attention to the needs of companies already operating in its territory, Bradley says. "We have a program in place calling on existing businesses day in and day out, making sure we're retaining our customers," he says. Assistance includes loan and grant programs as well as minority business development initiatives.
The results speak for themselves. "Last year we helped and supported [businesses] creating more than 50,000 jobs, with a little over $4 billion in capital investment," Bradley continues. "That number has continued to go up in the last few years."
The New York Power Authority also has boasted solid economic development successes through the years. "There are some 475,000 jobs linked to our lower costs around the state," says spokesman Michael Saltzman. "One of the fundamental things we do is support businesses in New York State, making them more competitive, and in return they make job commitments."
And in North Carolina, ElectriCities claims strong success in building the communities it serves. The organization that serves public-power cities reports that since 2001, its cities have contributed more than $1.3 billion in investment through new and expanded business, and have created more than 14,000 jobs. The organization and its affiliated municipal personnel provide a range of services, including marketing support, power and rate consultants, economic data, location information, and skilled staff resources.
The World Wide Web is becoming an increasingly important component in utilities' economic development efforts. It's a primary part of their recruitment and informational campaigns, and provides a great place to list available sites and solicit queries.
In California, the city of Santa Clara and its Silicon Valley Power utility took home honors from the California Association of Local Economic Development for their economic development website, MovetoSantaClara.com. The site targets commercial brokers, builders, developers, and site locators, providing economic and location data and promoting such benefits as low utility rates and the lack of utility taxes.
The site and another outreach initiative, the Commercial Broker Workshop, were deemed critical to the community's economic future when the dot-com swoon caused a 39 percent loss in commercial occupancies by 2003. These public-power-backed programs helped turn the situation around. By 2005, vacancy rates dropped 15 percent.
Research also can power economic development - it's obvious around the country in economically vibrant university communities. In Nebraska, a research effort linked with public power offers the promises of new jobs and a cleaner environment.
The Nebraska Public Power District and the University of Nebraska-Lincoln have joined forces to launch the Nebraska Center for Energy Sciences Research. The center is tasked with conducting research into new technologies and processes that will develop domestic energy sources, increase energy efficiency, improve the state's quality of life, and create economic opportunities. NPPD will contribute $5 million during the next five years to support a variety of research initiatives.
Areas of research could include advanced technologies for improving generation efficiency, energy efficiency and conservation, wind energy, fuel cells, biomass and bio-refineries, and batteries for electric vehicles. Researchers from the university already are working in many of these areas.
Such stories can be found across the country - just about anywhere public power flows. The means vary tremendously from one public-power company to the next, notes Nancy Kilgo, director of economic development for JEA, an electric, water, and wastewater utility in Jacksonville, Florida. "Some utilities offer a discount on upfront infrastructure installation. Some build business parks or do speculative warehouses or office space," she says.
But the same general motivation drives all public-power economic development. "We support our existing customer base as they try to grow and do expansions," Kilgo says. "It helps the area, and it has a ripple effect on our overall customer base."
Power That Businesses Can Count On
It's been alleged on many a political campaign trail that governments are incapable of delivering service that's high-quality, low-cost, and efficient. Pop culture delivers depictions of low-tech, small-town operations - the fictional town of Hooterville comes to mind.
But the operative word here is "fictional." When it comes to municipally owned electric utilities, operations are anything but backwards. "That is a myth and is one of the things we're trying to overcome," says John Humphries, general manager of Princeton Electric Plant Board in Princeton, Kentucky. The town is small (about 6,500 residents) but Humphries says his utility's reliability is as solid as anyone's - and stronger than most, in fact.
Spreading the word about the unusually reliable nature of public power isn't always easy, he acknowledges, recalling a conversation he once had with a local businessman. "I told him we have very reliable power, more than anyone else. He said, `OK, prove it.' But I didn't have any way to prove it to him."
That was then. Now, public power organizations have RP3, the American Public Power Association's "Reliable Public Power Provider" program. Through the program, public power systems can demonstrate proficiency in four disciplines: reliability, safety, training, and system improvement. Those certified as RP3 systems are allowed to use the RP3 designation in promoting their commitment to reliability and best utility practices.
Humphries heads the RP3 review panel. "RP3 recognizes the very good job most municipal electric utilities have been doing for years," he says. "RP3 provides a way to document what these utilities do for customers and businesses, with tracking methods recognized by national standards."
What makes public power systems so reliable? First and foremost, it's the fact that they are locally owned and controlled. "We have linemen very close to the customer," Humphries says. That means if the power goes out, it can be restored more quickly than if repair crews are based an hour away. In his community, power crews are likely to be among the first responders to auto accidents that damage power infrastructure. "In many cases our linemen are the first ones on the scene, before the police," he says.
But it's more than just the proximity of repair crews, he adds. The people to whom they are accountable also tend to be locals, which makes a big difference. "Not only is the lineman close to the customer, but the manager is here, and the board members are here."
"We tend to have higher reliability statistics, and we attribute that to the fact that we're locally controlled," agrees Stack of SMUD. "We're really proud of our service."
Humphries and others in public power are pleased to have a way to tell of their reliability because now, more than ever, reliability is a critical factor to business customers. "For many companies we deal with, reliability is even more critical than price. It's becoming more and more important," says Bradley of the TVA.
"I have several industries where reliability is more important than rates," Humphries agrees. "If the power goes out, they lose orders."
It's no surprise, then, that public power systems have greeted the two-year-old RP3 certification program with enthusiasm. "The first year we expected 20 applicants and got 65," Humphries says. "This year we had about the same level. It's been very well-received."
More Reasons to Pick Public Power Communities
As some of the public power representatives have alluded to above, the energy they market tends to carry a lower cost than that sold by other types of utilities. Statistics from the American Public Power Association indicate that the average rates that public power providers charge residential and commercial customers are below the respective averages charged by cooperatives and investor-owned utilities - as much as 10 percent lower on the residential side.
In some parts of the country, the difference is even greater. In SMUD's part of the country, it may be a 30 percent difference, according to Stack. That explains why communities bordering SMUD's territory have been asking recently if they can get their service from SMUD.
One of the major reasons for the cost savings is the fact that public power systems are not-for-profit organizations. Because of their business model, they are not required to generate a profit for their owners, which typically are municipalities or other governmental units. Any margin they may earn above the cost of providing power is invested in improving the utility's infrastructure and/or pumped back into the community in one way or another, through added services or lower taxes, for example.
Of course, the actual rates are just one measure of the cost of energy. Public power utilities may further lower costs in a variety of ways, including the kinds of business assistance and economic development aid outlined above, incentives and tailor-made "innovative rates," as well as programs to reduce or manage consumption of power. Some utilities will reward companies that agree to reduce their power usage during peak times, such as summer afternoons. Others will help install equipment designed to reduce peak loads, including thermal storage technology that allows users to create chilled water or ice during off-peak times and store the "cool" until the hot afternoon.
Utilities can help push costs down by lending the services of engineers and efficiency experts to help companies reduce consumption, or by underwriting some of the cost of energy-efficiency lighting or cooling. Some even lend customers equipment to do their own energy-efficiency studies.
The bottom line is that, like all companies, public power systems are beholden to their owners. But their owners are the communities that they serve, so they're hardwired to serve their communities' interests. As Stack explains, "Because we are locally owned by our customers, we have a real strong ethic about contributing back to the community."
Business Assistance in Springfield
Businesses can plug into low-cost energy in the southwestern Missouri community of Springfield, but that's just the beginning of the power they can receive from City Utilities of Springfield. They also can connect with Questline, a provider of technical assistance that partners with utilities to provide help for businesses.
City Utilities' Questline link puts businesses in touch with a variety of experts and helpful information, focusing on energy and other business-related topics. The online Facility Assessment Wizard lets businesses tap into a wealth of information for improving energy efficiency, lowering costs, and improving the bottom line. The eLibrary includes helpful resources on everything from processing technologies to manufacturing management to business development. Newsletters cover topics that range from energy-cost trends to managing OSHA inspections.
The "Ask an Expert" feature gives businesses one-on-one access to a team of researchers, engineers, technicians, and economic development professionals. And the Questline archives allow businesses to benefit from some of the queries previously handled by the experts. Because it's more than just a local service, it has provided answers to countless and widely varying questions, so there's a good chance that a Springfield company's question has already been asked and answered.
Healthy Winds Blowing in Nebraska
The power of wind is making itself known in Nebraska, where the Nebraska Public Power District has constructed 36 large wind turbines across the rolling Sandhills near Ainsworth. Each turbine features a 230-foot tower topped by 131-foot blades, and the group of 36 together can generate enough energy for 19,000 homes.
The facility generates power at its absolute cleanest, and there's no shortage of wind. At the height of the blades, the average wind speed is about 20 miles per hour. With all of its components together - turbines, substation, and roads - the facility uses less than 20 acres of land. It adds diversity to NPPD's generation mix that also includes coal, nuclear, hydropower, and natural gas.
The project is a venture involving NPPD and Omaha Public Power District, the Municipal Energy Agency of Nebraska, Grand Island Utilities, and JEA of Jacksonville, Fla. NPPD expects that the facility, with proper maintenance, will be able to generate power for 30 years or more.
Green Homes in Kansas City
The Kansas City area continues to enjoy strong economic growth. And, like other parts of the country, it is also experiencing increasing interest in energy-efficient technologies. The Kansas City Board of Public Utilities, on the Kansas side of the border, supports this interest with a range of energy-efficiency programs.
Nearly all of the 60 subdivisions sprouting in its service area are part of the utility's electric-heat program, which encourages the use of energy-efficient electric heating options. BPU offers builders incentives to choose heat pumps and other all-electric energy systems. For example, the all-electric homes at River's Edge East are designed to achieve the five-star Energy Star rating. The Estates of Connor Creek also offer heat pumps and electric water heaters, as do those at Maywood Estates, to name just a few.
Cleaner Air and Stronger Roads in San Antonio
CPS Energy, the municipal utility in San Antonio, has long followed environmentally sound practices in its energy generation. One recent project, undertaken voluntarily, takes what once might have been air pollutants and turns them into better roads.
The utility has installed baghouses at its coal-fired J.T. Deely power plant at Calaveras Lake. The chimney filters collect fly ash, which is a beige, powdery material that results from coal combustion. What do they do with the particulate matter once the giant vacuum-cleaner-like baghouses have taken the smoke out of the smokestack?
CPS is working with Material Technologies Inc. to recycle the substance and market it as a concrete enhancer and road-base stabilizer. The byproduct actually enhances more than just roads; the foundations of the two Deely Plant baghouses themselves contain 800 tons of fly ash.
Extra-Reliable Power Supplies in North Carolina
No one likes to lose power, but for some businesses, keeping the energy flowing is a matter of economic life and death. For those kinds of electric customers, ElectriCities of North Carolina is promoting the Prime Power Park, the state's only redundant-power industrial park with on-site backup capacity.
Located in Albemarle and overseen by the Stanly County Economic Development Commission, Prime Power Park supplements its traditional power supply with diesel-powered backup generators, with automatic switchgear and a 10,000-gallon fuel tank. They're designed to automatically restore electricity within 30 seconds of a failure in the outside power supply.
Of course, in some cases a 30-second outage is still too long. For those critical customers, uninterruptible power supplies are the answer for the ultimate in reliability and protection.
Powering Up in Indiana
Public power is alive and well in the Hoosier State, as evidenced by the growth of the Indiana Municipal Power Agency (IMPA). The organization is a not-for-profit wholesale power provider serving cities and towns who own and operate municipal utilities, and in 2006 it added nine cities and towns to its membership roster.
The communities of Dunreith, Knightstown, Rockville, Spiceland, and Thorntown signed on in August, just two months after IMPA added Brooklyn, Dublin, Gas City, and Lewisville. IMPA now has 49 communities on its roster, which together serve the electric needs of nearly 300,000 customers.
In addition to gaining a source of low-cost wholesale power, the communities can tap into numerous other IMPA services, including economic development. Among other things, they benefit from regional marketing, economic-impact analysis services, a site and building database, an economic-development "mystery shopper" program, and a range of training that includes IMPA's "Economic Survival Boot Camp."
Planning For The Future in Minnesota
Customer demand for electricity in and around Minnesota is expected to grow by 6,300 megawatts by 2020, and a group of public power utilities and others are making plans to meet the demand.
The effort is called CapX 2020 (Capacity Expansion by 2020), launched as a collaborative planning effort and evolving into a plan of action. The utilities involved are now seeking regulatory approval for hundreds of miles of transmission lines worth more than a billion dollars.
The utilities involved are diverse, but their quest to provide reliable power has proven to be a strong common denominator. Their development efforts are expected to continue even after the current project is complete.
A Bright Light in Central Florida
Over the last century, as Orlando evolved from a small town into a vibrant city, the Orlando Utilities Commission (OUC) has served as a backbone of the community, providing more than 196,000 customers in Orlando, St. Cloud, and parts of unincorporated Orange and Osceola counties with dependable, low-cost electric and water services. In fact, the OUC recently earned the APPA's Reliable Public Power Provider (RP3) designation.
Additionally, recognizing the needs of large commercial customers, OUC has expanded into new directions: OUCooling operates six chilled water plants in four districts providing more than 30,000 tons of cooling capacity. And OUConvenient Lighting provides innovative outdoor lighting solutions throughout Central Florida.
Sun Shines on South Carolina Green Project
A university building in October became South Carolina's first solar "Green Power" site. Santee Cooper, a state-owned electric and water utility, developed the project with Coastal Carolina University, installing solar photovoltaic panels atop four new multipurpose pavilions.
The panels can generate 16 kilowatts of electricity, enough to power more than 75 computers. Special metering equipment produces real-time statistics on the electricity being generated, and a web-based kiosk displays energy output information and additional renewable-energy information.
Santee Cooper and a number of South Carolina utilities offer "Green Power" to their customers. More than 3,800 residential, commercial, and industrial customers have purchased thousands of kilowatt-hour blocks since 2001. All of Santee Cooper's revenue from the sale of "Green Power" is being reinvested in future development of renewable resources or facilities such as this project.
Soy-Powered Generators Considered in Iowa
In an agricultural state like Iowa, it makes sense to grow your own energy. The Iowa Association of Municipal Utilities wants to do just that, and is helping a pair of member utilities explore the possibility of running generators on soy biodiesel fuel.
The Story City and Winterset municipal utilities performed a series of tests last fall to measure emissions from diesel generators running on biodiesel. Though results are still being studied, the utilities hope to prove that emissions are cleaner when the generators are powered by a renewable fuel grown by Iowa farmers.
Performing the tests is necessary because the utilities otherwise might have to seek modified regulatory permits if they choose to switch to biodiesel. They hope to prove that such paperwork hurdles are unnecessary.
For more information about the benefits of public power, contact the American Public Power Association at 202-467-2900 or visit www.appanet.org.
America's Public Power Utilities Fuel the Future
The power company - that's who sells electricity to you and your business. But there's another kind of power that America's public power utilities provide every day. It's the power to grow the community, strengthen its economy, and enhance its quality of life.
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