Community and Small-Scale Grid Innovation - Smart Grid (R) Evolution: Electric Power Struggles - page 176

SmartGridCity, in Boulder, Colo., is a fully integrated smart grid community with
what is possibly the densest concentration of these emerging technologies to date. It is
a comprehensive system that includes a digital, high-speed broadband communication
system; upgraded substations, feeders and transformers; smart meters; and Web-based
tools available through My Account. Customers that live in this area are now among
the first in the world to enjoy a system using smart grid technology to deliver its
electricity.
The site promises that Xcel will soon provide Boulder residents with “In-Home device
technology evaluation, conservation education, Pricing Plan participant results, plug-in
hybrid electric vehicle road tests, and added Web tools” (Xcel Energy 2008 ) . Xcel's news
archive from May 2008 includes an announcement that “we're on our way toward building
the grid of the future and making SmartGridCity a reality” (Xcel Energy 2008 ) . The news
release continues with a detailed description of the project's first phase, which was planned
to be conducted between May and August 2008.
However, by the end of 2010, Smart Grid City was embroiled in controversy and
widely proclaimed a failure. Early coverage had noted that the project could help smooth
tensions that had developed out of Boulder's opposition to Xcel's continued reliance on
coal, which represented a barrier to the city's commitments to substantially cut greenhouse
gas emissions (Fairley 2008 ). The project's collapse fueled support for a 2011 referendum
to municipalize the city's electrical system, taking control from Xcel (Chediak 2011 ) .
When The Denver Post investigated the documents and testimony that Xcel was eventually
required to file with the Colorado PUC and interviewed available Xcel executives, they
found the company had delayed for a year before informing the PUC about projected
cost overruns; installed 101 in-home energy devices, rather than the planned 1,850; and
abandoned the use of the communications software developed especially for the project
(Jaffe 2012 ) . Some of Xcel's partner companies also pulled out of the deal, leaving Xcel
short of financial backing. The article in E Magazine had hinted at possible financial
problems related to installation of the underground cable, quoting an Xcel spokesperson
who noted: “when they call it Boulder, there's a reason” (Martin 2010 p. 27).
7.4.2 Municipalization Challenges
Municipally owned utilities (colloquially referred to as munis) provide only a small
percentage of U.S. electric power, with approximately 70 percent receiving electric power
from private, investor-owned electric utilities, 15 percent from municipal utilities, and
another 15 percent from rural electric cooperatives or public power agencies (The
Regulatory Assistance Project 2011 ) . Like other companies in the private sector,