Wind Cooperative of the Year Interview: Holy Cross Energy
Wind Cooperative of the Year Interview: Holy Cross Energy
Location: Glenwood Springs, CO
Wind Powering America presented Holy Cross Energy with the Wind Cooperative of the Year 2003 Award at the CRN Breakfast held as part of the 2004 National Rural Electric Cooperative Association (NRECA) Annual Meeting in New Orleans, Lousiana, February 2004.
Tell us a little about Holy Cross Energy's electric business.
Holy Cross began operations in 1939 under the Rural Electrification Administration. We currently have nearly 50,000 electric accounts in four counties in western Colorado. About 83% of our accounts are residential, and the other 17% are commercial/industrial. Our energy sales are split about half and half between residential and commercial. Our service territory is primarily recreational in nature, but we also have an agricultural sector. We do provide service for larger commercial enterprises, such as hotels and premiere ski areas like Vail, Beaver Creek, and the Aspen Snowmass areas.
Our corporate structure is not for profit — we're driven by providing our consumers with the services and products they request.
How did Holy Cross become involved with renewables and wind in particular?
Starting around 1995, we wondered whether we should get involved with renewables. Our consumers had asked us to get involved. We conducted a survey in 1997 and asked our consumers whether they would be willing to pay more for renewables. The responses indicated that a good percentage would be willing to pay for a renewable product if it were offered at $5 a month or less. Working with Aspen's Community Office for Resource Efficiency (CORE), we developed our Wind Power Pioneers program.
We also wondered whether Xcel Energy could help us with a renewable product. At that time, Xcel was exploring the Ponnequin wind project. We made a commitment to Xcel for 1 megawatt (MW) of wind and offered a program to our consumers that was similar to Xcel's Windsource program. We wanted to make our programs compatible. It made sense to make our projects similar so that there was no confusion between the two programs.
The first megawatt sold out, and we soon developed a waiting list. We continued to purchase additional increments of wind energy, and we now have a commitment with Xcel for 5 MW of wind energy from Ponnequin. We continue to market that particular product — we haven't sold all of that commitment to our members.
In 1999, we started developing a local renewable resource pool. We net meter photovoltaic systems for consumers (we started doing this before it was a state law). We also negotiated with consumers to buy the output of small-scale hydro systems; we then sell that renewable energy to our consumers who wish to buy the output. The utility has to be willing to pay customers a premium; the premium is recovered from other consumers who request renewables.
How do you market your wind product?
The most effective marketing technique was direct mail to our consumers. We mailed brochures and included articles in our consumer newsletter. We partnered with CORE members and offered them a modest financial incentive to market wind power. We also did direct marketing — we called our larger accounts, like the ski areas, and asked them to participate. And we distribute a few press releases now and then.
We also offer new consumers a two-for-one deal to get them involved. We give them one block of wind energy for every block they purchase for up to one year.
We also support and contribute money to the LivingWise educational initiative in our service territory. Teachers who choose to participate receive computer software, lesson plans, and curriculum. Every year we purchase about 1,000 student kits. Each of the students' kits contains a low-flow showerhead, a compact fluorescent bulb, and a CD with software and games. The students can install the equipment and conduct a small energy audit on their own homes. We've distributed about 5,000 or 6,000 kits in our service area.
This year, teachers and students can also participate in a new fundraiser offered by Holy Cross. We include wind energy information in the student kits, and they can invite family and neighbors to sign up for blocks of wind power. For every block of wind power the students sell, they get a dollar for the classroom. The class that sells the most blocks gets a $250 award.
We continue to market wind energy. You have to continue and keep it in front of the consumers. Co-ops that market wind energy need to make a commitment, and it has to be ongoing or it will not be a success.
How have your consumers responded?
We have a 5% participation rate in our wind energy program. That means 47,000 accounts have chosen not to participate, but in the scheme of utilities and green pricing programs, our utility is doing pretty well.
The average consumer signs up for three blocks of wind energy. Consumer response has slowed a bit in the past couple years — its been slow but steady. People know we have a wind program, and they approve of it. The community response has been positive.
The Denver newspapers recently reported that Holy Cross supports a renewable portfolio standard (RPS) in Colorado. Many rural electric cooperatives have not supported an RPS; why is Holy Cross taking this position?
We've been working hard on this piece of legislation. Last year we started working with the bill sponsors and proponents of the RPS legislation in a couple of areas. One area was the limitations of last year's bill. We made constructive suggestions, and the proponents revised that portion of the bill. The bill is being debated in the Colorado Legislature.
What needs to happen to engage the rural electric co-ops to support wind energy?
Although the Colorado Rural Electric Association (CREA, an organization made up of the rural electric cooperatives in Colorado) is currently neutral about this bill, its membership is a mixed bag. Almost half of the members think the bill should be passed or wish to adopt a neutral position. Only a few of the co-ops have a problem with an RPS. Engaging these co-ops will involve a grassroots effort from the consumers, not unlike what happened at Holy Cross. Consumers need to ask those rural electric co-ops about renewable products and create a market. Do it from the inside, not the outside. That won't happen overnight, but Holy Cross believes it will be the best way to do it.
Co-ops are fiscally conservative and represent members' needs. Our reason for existence is to provide service in some form. We've shifted from being skeptical — co-ops need to make good economic choices for today as well as tomorrow. Consumers need to influence their boards and the staff at the local electrical cooperative.
We think of wind as a hedge for natural gas prices. Xcel, our power supplier, uses a lot of gas — more than 3,000 MW of gas capacity. That's a sizable piece of the generation mix. Having that much gas capacity already in place makes it easy to displace gas-fired generation as the wind is available, thereby providing the hedge.
Wind energy has many benefits — not just environmental. Wind energy seems to be more economical compared with natural gas. We have to look at capacity and the availability of the wind resource. In our minds, wind energy and the Xcel system is a good match, and the residents and consumers will benefit as gas continues to stay at its present price levels. We've seen all the predictions about natural gas prices staying above the benchmark for the next 20 years. Wind makes good economic sense.
Describe Holy Cross' relationship with CORE. How has CORE helped Holy Cross' effort to increase the application of renewables and efficiency?
CORE is the Community Office for Resource Efficiency, based in Aspen. A group of community organizations came together to promote renewable energy and energy efficiency. Holy Cross helped get CORE off the ground. Some of the original organizations dropped out, leaving only Holy Cross and the City of Aspen. CORE relies more and more on grant funding; it received grants for the Million Solar Roofs initiative and others.
One of CORE's projects is the Renewable Energy Mitigation Project, or REMP. New homes need to meet energy efficiency guidelines; if they don't, developers pay a fee that is used for carbon mitigation. REMP collected more than a million dollars in fees in the first year. CORE continues to improve its ability to perform its primary mission of resource efficiency. We've been working with them for more than 10 years. They're a good advocate and good supporter for us, as we are for them.
What are your plans for the future regarding renewables and wind?
Our plans are driven by our Thanksgiving 2002 survey. Our consumers requested that we increase our percentage of renewables and offer more energy conservation and efficiency programs. They wanted us to offer cleaner-burning fuels without sacrificing reliability and without too much of a cost impact. We're looking at ways to do that. Currently 8% of our power supply is generated from renewables. We would like to increase that by 10% over the next 10 to 12 years. We're shopping for renewables that make economic sense.
We want to provide incentives, if possible, to encourage people to develop small-scale renewable energy systems, like wind or biomass, and explore the possibility of using methane gas released from mining operations. We can capture it and burn it instead of letting it escape into the atmosphere.
We're exploring the possibility of contracting to buy wind on an as-available basis. We would agree to pay x number of cents per kWh of wind energy. It would fluctuate according to wind and load, but we could buy wind on an economy basis as we do for other fuels.
Our larger commercial consumers are also getting involved. The Vail Resort is performing an economic analysis for a wind project consisting of four 100-kW machines. Aspen has installed a 150-kW hydro generating facility at Snowmass. Water will run through the snowmaking system pipelines and generate electricity during warm months in a non-traditional way. Snowmass also powers a small generator from the water movement between two municipal drinking water tanks. As water moves between storage tanks, it generates 25 kW of electricity.
Our underlying goal is to meet our consumers' expectations and reduce carbon intensity from our business activities: biodiesel fuels in our vehicles, anything that will contribute to that ultimate goal.
This information was last updated on August 02, 2011