Saturday, July 29, 2006

WindSource Premium - How Long?

Over a month ago I wrote a letter to Xcel asking about the comments of spokeswoman Ethnie Groves, who told the Denver Post,
"This is a premium price program, and customers that elect to join the Windsource program have decided to pay more to build up wind power in the state," Xcel spokeswoman Ethnie Groves said. "This was never designed to be competitive with traditional generation."

It took a while but I got a response.

I'm not clear on blogger ethics (quick, someone convene a panel!) about publishing letters from company executives without having informed them of my intention to publish as a blogger first. My gut told me to disclose my intentions and ask permission to publish the letter, even though I'm probably legally free to do so. It's again taking forever for Xcel to get back to me, despite an assurance that I would receive a response by last Monday, so that is why I'm writing up this summary of what the Xcel representative wrote.

He said that Windsource is one of the first of its kind, one of the largest producers of wind energy in the country, and there are plans to expand the program by 2008. It was designed from its inception as a premium to bring renewable, clean energy to Colorado, and customers who choose to pay more for Windsource are helping to expand the program. The increase in traditional fuel costs coupled with tax credits is helping to make wind power more cost effective, plus the Windsource program helps Xcel meet its Amendment 37 requirements.

Most of that I understood, but I still had a question, so what follows is my letter in response:

Dear Mr. K.,

Thank you for taking the time to so thoroughly respond to my questions. But I'm still not quite understanding Ms. Grove's comments even in the context you provide.

I agree that seeking and developing renewable energy sources is a worthy and necessary cause that I would willingly pay a few extra dollars to help fund. I, too, am proud that so many Coloradans think enough of our planet that they willingly pay premiums to help develop these sources, and that we have an energy company, Xcel, which is working to develop them. And I do understand that developing new technologies and increasing infrastructure to meet increased demand requires an initial cost increase.

As you stated, it is the intention of Xcel to expand the use of Windsource, an increasingly viable and cost effective energy source,
particularly in light of the higher costs of other fuels. That suggests that at some future date Windsource prices will lower, thus being
competitive with those other fuels. That is why Ms. Grove's statement that Windsource is a premium which "was never designed to be competitive with traditional generation" is a cause for confusion.

It suggests that Xcel will always keep the cost of Windsource higher than traditional generation, thus always keeping it non-competitive and merely profiting off the desire of so many Coloradans to be responsible consumers.

I hope you understand the concern that statement would cause in many consumers. Could you clarify whether Windsource will ever be considered a non-premium, competitive product?

Thank you for your time,
Julie O.

He called me twice, after this letter and one other reminding him that I was waiting for a response. He was very nice and personable, said he would ask Ms. Groves for a clarification and also that he would ask corporate if he could give me permission to reprint his letter.

He said I wasn't the only person to contact him with concerns on this issue, so I would think it would behoove Xcel to let the public know that WindSource will someday be competitive. Unless there are no plans for it to ever be competitive.

If I ever hear back, Dear Reader, I will inform you.

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