If you’ve been wondering why San Antonio’s climate action and adaptation plan doesn’t mention ending the practice of burning coal to make electricity, you don’t need to look any further than the city-owned electric utility – CPS Energy.
Silent in Meetings, Active Behind the Scenes
After putting up the money to pay for the (fairly ineffectual) consulting services, CPS Energy was noticeably absent from the work of developing San Antonio’s climate action and adaptation plan. Sure, they’d send a representative to the meetings, but they were there to observe, not participate. CPS Energy’s views did shine through the mouthpiece of the consultant, who, under the guise of “facilitator” argued against any goals or emissions strategies that were “too ambitious.” The message was clear: Science be damned, CPS Energy needs to keep burning fossil fuels. That’s why the goals and strategies for reducing emissions from the energy sector in the plan’s first draft were far weaker than what the Energy and Buildings Working Group supported.
But even those weak goals, such as the one calling for CPS Energy to close it’s coal and natural gas power plants by 2050 – decades too late to avert climate catastrophe – were too ambitious for CPS Energy. We now know that CPS Energy CEO Paula Gold-Williams sent a letter to the San Antonio Office of Sustainability on April 25, rejecting not only that milquetoast goal, but also the very idea of involving the public in such decisions.
Ms. Gold-Williams took on the idea of involving the public in the most fundamental and important decisions that the public utility makes first, illustrating that it is this challenge to her absolute control over CPS Energy that she fears most.
A Public Process for Everyone, Not Only Environmentalists
Gold-Williams spun the request for a public process as an attempt to focus solely on environmental concerns to the exclusion of any others.
“Creating a new governing committee, solely focused on our environmental generation planning is problematic and presents significant challenges to our historically highly effective business model and approach.”
Gold-Williams might have a point here, except that even we environmentalists were never advocating for “environmental resource planning.” We were (and are) seeking a public process that allows a representative group of CPS Energy customers of all types to engage in a meaningful way in the decisions about which energy resources the utility should use going forward. This process should include sharing of data, a collaborative approach to selecting scenarios to run through the utility’s planning models, and an honest conversation about the environmental, reliability and economic costs and benefits of those scenarios. This is what we are proposing.
CPS Energy Rolls the Dice, Customers Pay the Price
Ms. Gold-Williams’ assertion that the CPS Energy business model is “highly effective” bears some scrutiny as well. It was just in 2017 that the utility wrote off $391.4 million in a failed investment in a nuclear power plant. And guess which utility was the last in the U.S. to build a coal plant, as other utilities were already moving to end their use of coal for environmental and economic reasons? CPS Energy. Now that coal plant CPS built in 2010 – Spruce 2 – is already losing money and is likely to continue to do so. There was substantial public opposition to both of those investments. It’s CPS Energy customers who have and will continue to pay higher bills because of these blunders.
It’s high time for CPS Energy leadership to acknowledge that they while they have a monopoly customer base that pays for their mistakes, they don’t have a monopoly on knowledge or data. CPS Energy could reduce its risk of future costly blunders by actually examining and utilizing credible information presented by stakeholders.
Skimming the Surface, but Never Diving In
The list (included in the letter) of ways in which CPS Energy already offers opportunities for community engagement looks pretty good if you’ve never participated in any of these events or if you have no frame of reference for how public resource planning processes are handled in other places. These opportunities allow only for surface-level engagement and promoting of CPS Energy’s brand and programs, but never sharing of much useful data or real discourse, in public or private.
The couple of public input sessions hosted by the CPS Energy Board of Trustees are something that should be continued, but they are nothing like a real resource planning process. CPS Energy staff makes a presentation to set the stage and those who arrived on time are allowed to speak for three minutes. Board members are present, but don’t ask questions or make any responses at the meeting or afterwards.
We don’t know what meetings with other stakeholders are like (because CPS Energy has kept us all separate), but the environmental stakeholder meetings are generally unproductive. Until recently, these meetings were mostly consumed with presentations on topics other than those that the stakeholders wanted to discuss. Little detailed information is shared and even relatively small requests for change are met with a wall of opposition from Gold-Williams and her staff. Participants have often felt like these meetings are, at best, a waste of time, and at worst a way for CPS Energy to greenwash (make the company appear environmentally responsible). The fact that they were mentioned in this letter speaks to our concern about greenwashing.
The Citizens Advisory Committee (CAC) meetings aren’t open to the public. Given that council appoints 10 of the 15 members, there could be an opportunity to reform this group to provide a more clear service to the community. At present, it appears that CPS Energy staff treats the CAC as a focus group.
CPS Energy’s “People First Customer Care Fairs” are a series of tables with CPS Energy and other service providers offering information about how to participate in existing customer-facing programs, like energy efficiency and solar. They also gather survey responses related related to resource planning. That’s just fine, but these events are not functional for examining the details of complicated policy and planning decisions.
We think it should go without saying that social media and the call center serve important purposes, but are certainly not where complicated decisions, like when to retire fossil fuel plants or how much energy storage to invest in, are going to happen.
The Boogeyman Rating Agencies
Ms. Gold-Williams concluded this section of her letter by raising the specter of a credit rating downgrade for CPS Energy, if they were to allow a public process for resource planning.
“The last major consideration on this topic is creating a new governing body outside of our historical norm could cause concerns from the Ratings Agencies. Currently, our strong credit ratings are significantly driven by our strong management team, as well as our balanced strategic approach.” (underlining and bold as in original letter)
This is one of the utility’s go-to fears to monger, but it never comes with any detail or evidence to support it. Why would a ratings agency prefer a utility to close itself off from gathering information from more sources? Austin Energy, which is also a city-owned electric utility, has utilized a public resource planning process for years and it received a credit upgrade earlier this year.
The section of the letter that Ms. Gold-Williams dedicated to the goal of phasing out fossil fuels for electricity production might have been appropriate two years ago, as the city was poised to start the climate planning process. Yes, analysis must be done and a thoughtful plan developed. Yes, energy storage will be needed, as well as much more solar and wind energy. No, it won’t happen overnight.
But even though CPS Energy was very publicly involved in announcing and funding the development of the climate plan, the utility refused to provide any modeling data to show what various options for achieving this goal might look like. Back in July of 2018, CPS Energy staff did promise the environmental stakeholders that they would model a scenario for ending the use of coal in 2025. We were told that results would be presented to us in September of 2018, then December 2018, then February 2019, then April 2019. Last week we were finally told that the results were too imprecise to be worth sharing. This doesn’t bode well for the utility’s ability to avoid wasting more money on bad decisions.
While this section of the letter spoke to general concerns, we see that they resulted in a significant detrimental change to the climate plan.
Mitigation strategy number 1 in the first draft read, “DECARBONIZE THE GRID Work with CPS Energy to continue to reduce the emissions factor of supplied electricity to reach an emissions factor of 0.0 kg CO2e / kWh by 2050.”
In the latest draft it reads, “REDUCE THE CARBON INTENSITY OF SAN ANTONIO’S ENERGY SUPPLY Work with CPS Energy on the implementation of their “Flexible Path” to drive towards carbon neutrality by 2050.”
This current language would enshrine CPS Energy’s Flexible Path within the climate plan. And it would set the goal as “driving towards carbon neutrality” instead of true zero emissions electricity. This implies that CPS Energy will continue to burn coal and/or natural gas, even as the climate crisis accelerates, as San Antonio struggles with unhealthy air pollution, and cheap renewable energy makes fossil fuels uncompetitive.
Flexible Path to Destruction
On Monday (Aug 26), Ms. Gold-Williams made a presentation to the CPS Energy board of trustees that accelerated our fears about what the Flexible Path may bring. It showed CPS Energy not only extending the life of its existing natural gas plants and contracting for an additional 300-500 megawatts of natural gas capacity, but also running the coal-burning Spruce 2 plant out past 2060.
The climate science is clear that the world must reach carbon neutrality by 2050 at the latest (possibly significantly sooner, and must then start achieving negative emissions, or sequestering more carbon than we emit) in order to avert climate catastrophe. While some sources of emissions will remain and will require additional carbon sequestration to offset them, those emissions must be minimized as much as possible. Sequestration is difficult and expensive, so eliminating emissions wherever possible is far preferable. This is not to mention the co-benefits of reduced air pollution, more and better jobs, and lower electric bills. And since significant near-term emissions are needed to stop runaway climate change and reductions from the transportation and other sectors will rely on carbon-free electricity, ending the use of coal and natural gas for electricity production is a necessary first step.
This pathway presented by CPS Energy is wholly incompatible with climate action.
Where Are We Now?
The San Antonio City Council will vote on the SA Climate Ready climate action and adaptation plan on October 17. That’s a solid 6 months after the vote was originally scheduled and CPS Energy, the oil and gas industry, the San Antonio Chamber of Commerce and the car dealers were successful in making the plan even weaker than it already was. That’s a truth. We also believe that no plan is the worst option.
So, we’re focused on getting the endorsement of CPS Energy’s Flexible Path removed from the climate plan and moving on to changes that must happen at CPS Energy. We’ll be focused on getting Mayor Nirenberg and the rest of the CPS Energy board to adopt a public, inclusive resource planning process to examine alternatives to burning coal.