Friday, July 17, 2009

Largest Green-Power Program Stumbles

So, from recent articles in the NY Times and the Austin American Statesman we now learn that Austin Energy's vaunted green power program is only 1 percent subscribed and that all ratepayers may have to shoulder the cost of the renewables added to the system for the program (See articles in the Austin American or in the NY Times).

They wonder why the program is so under-subscribed. Someone must be kidding. Has anyone looked at what they're offering? From the Austin Energy website:
“An average residential customer consuming about 1,000 kWh per month will pay about $43.50 per month more if opting for a 5-year subscription or $58.50 per month more if opting for a 10-year subscription.”
First, this is a huge surcharge for renewable energy. We're talking a 63% increase if you sign up for the 10-year plan. Second, the pricing is upside down. A higher unit rate for a longer subscription? The NY Times should try selling its newspaper with that type of pricing strategy and tell me how well they do. Moreover, with renewable portfolio standards expanding throughout the country, more ratepayers are beginning to pay the costs of adding renewables to the electric grid. But, at least they share this cost equally... and so far the percentage increase is only in the single digits. Done well, the cost of adding renewables to the electric system does not have to short circuit customers' wallets.

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