CPS Energy officials approved a second yearlong extension of existing energy efficiency and solar programs, delaying a major decision on a new vision for these programs until at least 2021.
Since 2009, CPS Energy’s Save For Tomorrow Energy Plan (STEP) has been a key part of the utility’s strategy to avoid building new fossil fuel plants. In August 2019, the program met its goals of energy savings with $723 million in investments in energy efficiency, demand response, and a wide array of solar programs.
All CPS Energy customers pay to support these programs, with average residential customers using 1,000 kilowatt-hours and 5,000 cubic feet of natural gas paying $4.09 per month, according to utility figures.
Last year, City Council approved a yearlong, $70 million extension to keep existing programs running until January 2021. The extension was supposed to give the utility more time to propose a new generation of these programs.
But on Monday, the board unanimously approved another $70 million extension until January 2022. Utility officials say the move is necessary to allow more time for planning another 10-year version of its STEP programs. Officials call that next-generation version FlexSTEP.
“Our biggest concern is that we have a gap” between STEP and FlexSTEP, CPS Energy President and CEO Paula Gold-Williams said ahead of the vote. “This way, we keep everything flowing.”
The pandemic has contributed to the delay. CPS Energy paused the voluntary programs for several months help its staff avoid contracting and spreading the virus, said Rick Luna, interim director of technology and product innovation.
“In September, we began to resume and are ramping back up to our pre-COVID levels,” Luna told board members.
San Antonio Mayor Ron Nirenberg, a board member in his official capacity, said he doesn’t want the utility to get “complacent with the additional year.”
“I don’t hear that from you at all. I just want to guard against that,” Nirenberg said.
CPS Energy officials say their former STEP program allowed the utility to reduce demand by 845 megawatts over 11 years. However, many find its methods of calculating its energy savings difficult to understand.
Even trustee Ed Kelley, the utility’s longest-serving board member since 2011, said during the meeting that he “has never understood the methodologies for gauging the so-called megawatt savings that we have.”
“I’m not in any event saying our current calculations are not correct,” Kelley said, though he described them as “highly subjective.”
After Kelley’s comments, trustee Willis Mackey added an amendment to require an independent, third-party audit of the program. Board members unanimously approved the measure, with Mackey’s amendment.
Kelley said he wanted the auditor to be “unbiased” and “without a vested interest.” He was referencing a May 2020 review of STEP by consultant Optimal Energy, funded by the Lone Star Chapter of the Sierra Club.
The Sierra Club is a part of the Recall CPS coalition behind a petition drive to eliminate the utility’s board and force a shift away from fossil fuels by 2040, among other reforms. In an Oct. 7 open letter, other Recall CPS leaders had called for CPS Energy to “elevate FlexSTEP as an essential part of a just COVID-19 recovery.”
The Optimal report concluded that the previous version of STEP has “cut energy demand and overall energy use, saved customers money, reduced environmental impacts, and delayed the need for investment in additional generating capacity.”
However, it also criticized the STEP goal for not being tied to reducing the need for energy during periods of peak demand. Calculating savings this way “delivers no specific customer, societal, or environmental benefits,” the report states.
Greg Harman, a San Antonio Clean Energy Organizer with the Sierra Club’s Lone Star Chapter, said in a public hearing Monday that FlexSTEP has “huge COVID recovery potential” and is “able to reduce bills, keep people in their homes, and create jobs.” The Sierra Club got “no response” when it delivered the report to CPS Energy in May, Harman said.
“This is how community organizations are routinely treated and why there is now a petition to move the governance from the board to City Council,” Harman said.
At the meeting, Kelley, a former USAA Real Estate executive, described the activists and volunteers as “a bunch of people that have no clue about how to run a major company.”
Extending the existing STEP program another year would require City Council approval. Officials have not yet scheduled a vote.
Disclosure: CPS Energy is a San Antonio Report business member.