Madison Hiking Utility Rates: Local Power, Anyone?

Tuesday's MDL reports the Madison City Commission plans to raise my neighbors' rates for electricity, water, and garbage. on electricity, the city says, Don't blame us!

Ericsson described the municipal electric utility as only a "distributor of power" and not a producer. He said that the city had to increase its rates partly due to the increased cost of electricity that Madison was billed from its suppliers -- the Western Area Power Administration and Heartland Consumers Power District.

According to Ericsson, the city electric utility wasn't itself generating many new expenses and thereby creating bills that needed payment.

"We're buying some capital things, but not a lot of things," Ericsson said [Chuck Clement, "City Moves on Utility Rate Hikes," Madison Daily Leader, 2010.11.09].

Come now, Commissioner Ericsson. How can you blame Russell Olson and all the nice people at Heartland? Instead of shifting blame, the city could Power Forward™ with some local energy production, if it would just listen to its creative neighbors and local entrepreneurs.

Meanwhile, just how much will electricity bills rise in Madison?

In 2010, city electricity customers would pay about $105 per month for 1,200 kilowatt-hours of electrical power. With the rate increase, customers will pay about $114 for the same 1,200 kwh, an increase of $9 per month [Clement, 2010.11.09].

Quick comparison: Here at Madville Times World Headquarters, safely removed from the city limits of Madison on the western shore of freedom-loving Lake Herman, my family used an average of 1431 kilowatt-hours per month over the past year (minimum: 566 kWh from mid-September to mid-October of this year; maximum 3765 kWh during the December 2009–January 2010 billing cycle, including that cold Christmas blizzard). That's includes our heat, which is all electric. Average monthly bill with Sioux Valley Energy: $93.

More electricity, less cost. Ah, country living....

Water is cheaper in town, since the city has its own wells, while we Lake Herman denizens have our water piped in from Chester (or De Smet?) and support a network of 2200 miles of pipe. Hmm... have your own source, pay less... is that another argument for Madison to develop its own local power sources, or maybe even get gung ho like the Army and set a goal of energy self-sufficiency?
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Update 2010.11.13 08:30 CST: General Manager Mike McDowell writes from Heartland Consumer Power District's new multi-million-dollar headquarters that Madison's increased electrical rates aren't Heartland's fault, either.

South Dakota Groups Apply for $250 Million in Broadband Stimulus

Among the stimulus dollars still to be pumped into the economy: $4 billion in grants and $3.2 billion in loans to expand broadband Internet access to underserved areas. The feds have received 1130 applications to build "last-mile" services—the projects that lay the cable or erect the towers that get signal to people's houses and businesses. A quarter of those applications have come from companies and organizations looking to extend WiMAX wireless systems. Nationwide, WiMAX vendors have submitted $1.6 billion worth of requests for stimulus funding, out of a pile of last-mile funding requests totaling $14.2 billion.

WiMAX—that's the technology Sioux Valley Energy uses to beam out Internet signals from the top of the Madison hi-rise to an eight-mile service radius. Sioux Valley also has WiMax transmitters in Hartford and Brookings (Brookings?! I hadn't heard about that one!). A search of the NTIA database of broadband stimulus apps shows Sioux Valley is applying for $480,000 to extend WiMAX service to four communities.

Sioux Valley's grant request is the smallest broadband stimulus received from a South Dakota organization. Twelve different South Dakota organizations have applied for over $250 million in grants to extend broadband service. The biggest request: Pierre-based Dakota 2000, Inc., is seeking $132 million to build a fiber-optic cable network that would connect all Native American tribes in South Dakota, North Dakota, and Montana. That ambitious project is just one portion of a proposed Ring of Nations that aims to connect tribes all across America to Native-owned broadband service.

Among the reasons to hope Uncle Sam approves South Dakota's broadband stimulus apps: according to a 2007 Brookings Institution report by Robert Crandall, William Lehr, and Robert Litan, every 1% increase in broadband penetration in a state is associated with a 0.2% to 0.3% increase in non-farm employment. Hmm: In October, South Dakota had 406,500 non-farm workers. Increase broadband penetration in the state by 1%, and, if Crandall et al. are right, we could easily add 800 new jobs. That would almost erase joblessness in Madison and Brookings. Increase broadband penentration by 10%, and we could put 8000 people to work and drop the state unemployment rate back below 3%.

Dang: maybe the LAIC needs to subsidize broadband access in Lake County to bring down our 7% unemployment rate. Or maybe South Dakota should look at a plan to turn the whole state into one big wireless hotspot.

Smart Grid Saves You Money with Transparent, Timely Energy Pricing

Those darn greenies and their good ideas, saving us money....

I was just reading my Sioux Valley Energy newsletter when I came upon another really good explanation (available here in PDF) of how the smart grid will save you and me money.

Sioux Valley Energy is getting $4 million in stimulus money to cover about half the cost of installing 23,000 smart meters—that's a meter for everyone Sioux Valley juices up. Once those meters are installed, Sioux Valley will be able to implement variable power pricing based on peak load and time of day. When demand spikes, utilities have to buy more expensive supplementary power. The power I use for my computer during peak hours costs more than the power I use in the middle of the night. Smart meters will allow Sioux Valley to charge me different rates for the power I consume based on when I use it.

Sioux Valley CEO Don Marker explains it this way in his column in the December newsletter:

The idea is that these smart meters will allow you to monitor, whether that be through the Internet, via email or by text messages, your electric usage at any given point in time. So you can make the choice whether or not to run your dishwasger when the price of electricity is really high, or wait until the price goes down. In the future, "smart" appliances will allow you to program them to coordinate with the price of electricity [Don Marker, "$4-Million Grant for Smart Grid: Unique Opportunity or SVE Members," Sioux Valley Energy Connections, Dec. 2009].

Smart meters will let us see electricity prices on our computers the same way we see gas prices on the signs all over town. We'll see the numbers right in front of us, and we'll be able to adjust our power usage to save some money. (Of course, I suppose it's possible that there could be some crazy reverse feedback spike when we pennypinchers see the electricity price suddenly drop, shout "Buy Buy Buy!" and all crank up our washing machines at once. Smart meters should make a great thesis topic for some eager MBA!)

Sioux Valley says the smart grid technology will help it put off building new power plants and infrastructure, which means of perhaps $4 million a year. In other words, Sioux Valley's eight-million-dollar investment—half from customers, half from taxpayers and deficit spending via the stimulus—could pay for itself in two years. Hmmm... looks like all that deficit spending could actually leave more money in our grandkids' pockets.

Smart grid technology makes sense whether you're a treehugger or a pennypincher. Let a few fringe elements try to stir Big Brother fears; I'm ready for Sioux Valley to hook me up and save me some money!