Tuesday, December 16, 2014

Utility Rate Merry go round

Every few year’s utilities take a look at their financials and realize it is costing more to do business than it used to.  So, they go through the laborious and very expensive task of determining what revenues are necessary to stay afloat in the years ahead.

And, by stay afloat – I don’t mean, necessarily, how much cash should be paid the stockholders in the case of investor owned utilities, or consumers in the case of public and cooperative power – I mean stay afloat in terms of operating a utility – and keeping the kilowatts flowing to our refrigerators, freezers, wine coolers, latte machines, water heaters, pumps, and yes, even lights.

The electric utility that delivers the spark to your house or business is part of a very complicated system. Electricity can’t be stored in massive amounts for any long period of time.  So, it’s generated as it is needed.

When you flip the switch in the living room, or turn on the oven, or call for heat from your furnace, or turn on your computer, the utility needs to provide the power.  Somewhere along the line a generator is working just a little bit harder.  

A utility like the Public Service Company of New Mexico, one of the smallest in the country, is still so big that flipping a light switch at home doesn’t show up…but I’m told when the lights come on at UNM’s football stadium, or at Isotopes Park, or at community ball fields – in fact there is a “blip” on a screen somewhere that says – make power electricity – now!

In order to do that, the infrastructure needs to be in place.  Wires, poles, insulators, switches, breakers, transformers, and even generators need to be working – all the time 24/7.   If there is a defective part – the power doesn’t get delivered and it is hell to pay.

To alleviate those little inconveniences like no electricity, systems are in place to re-route power from one location to another – in almost every case it is done automatically – and we don’t even know.  In major cases, someone somewhere in a control room issues a command and opens switches allowing power to flow from the generator to the customer over a different path.

And – there had better damn well be electricity, all the time.

That’s why utility rate increases are necessary – to provide the infrastructure to get the spark to your house, business, or mountain cabin.

The real challenges in rate design these days must be – how do we design a system that provides power to the end user – when it is needed?

End users have installed wind mills, solar units, or in some cases built little hydro generation systems along a creek – to help protect the environment, to take advantage of tax breaks, or just because it seemed like the right thing to do. 

Everything is fine and dandy as long as those little generators are working.  But, if something happens and the little generator can’t produce power – what happens?  That customer still wants to run the TV, or a computer, or the furnace  and the power needs to come from a central station provider – the utility.

So, the rub.

How does a utility build a system that allows the end consumer to generate his own power, thus allowing the huge generating plants to spew less stuff in the air or consume coal, uranium, oil or gas – unless something goes wrong and the power goes out –leaving the house or factory dark and cold?

Developing the econometric model that answers those questions is not perfect, so the utilities make their best educated guess at what rate the customer can accept that will keep the power on.

We should be glad they do.   

And, my experience is, the utility will ask for more – because the regulators aren’t going to issue an automatic yes.  The regulators will take the utility work, do their own studies, and then agree the utility needs more money to keep the lights on…but just not quite as much as they asked for.


You can take that to the bank!

Tuesday, December 9, 2014

Discovery Lies and the Loya Christmas Lights

So, Discovery Channel did a lot of hyping about some show that was going to feature some fellow getting eaten by an anaconda snake. 

There were preview stories about the search for the snake, the outfit the fellow was going to wear so he could slide down the snake’s throat, closed circuit TV of the travel inside the creature, etc.

Well – they lied. 

This fellow didn’t get eaten by a snake.  The giant snake did what it knows how to do, twist and turn and squeeze until the fellow hollered “uncle” and the staff came to rescue him.

 About 1:50 of “drama” and 2 minutes of eating – glad I didn’t watch the whole thing, just clicked in occasionally to see what was happening.

Discovery lied!   The media didn’t tell the truth! 

Now, hopefully the truth!

With little hype, The Great Christmas Light Fight is on ABC for a second season.

One of the featured stories was from El Paso where Fred Loya (of insurance fame) has, for 10 years or so, put together a notorious –in a good way- Christmas light display.

Wow!

It is a synchronized show that only operates on weekends – and thousands and thousands of people go by.  The Loyas even provide hot chocolate and cookies after every show and “selfie” photos are encouraged with Santa and the elves.

Mr. Loya came across as a genuine nice guy, appreciative of the lifestyle he can now live – thanks to thousands and thousands of insurance customers who choose his company.

El Paso should be proud – he has brought unselfish recognition to a community – and even announced that the $50,000 his display won in the competition will be distributed amongst the community charities.

That seems like a lot of good to go around.  I only open the Loya story, as shown on TV, is true.

Other communities should be so lucky!

In the Albuquerque TV market, the Fred Loya Insurance Company ran commercials adjacent to the show. That’s marketing and promotion.

Oh, did I mention that Mr.Loya and his wife moved to the USA from Mexico 40+ years ago?

Welcome!  

And, from far away Albuquerque, thanks for making the holiday season in El Paso so special!  

Anybody seen anything like that in our neighborhoods?


Thursday, December 4, 2014

Morning Television Throwback

Here's a newspaper ad for a program I once hosted on KOAT-TV.

40+ years ago.

We didn't have many studio guests, but took live phone call-ins.

That was fun!


Yikes!  

Sunday, November 30, 2014

Things Change at Nebraska

Remember a few weeks ago when I posted pictures of the University of Nebraska football stadium...

Well, they have a 9-3 season...and what happened today (Sunday)...

Nebraska football coach Bo Pelini has been fired effective immediately.  Terms of Pelini's contract call for a buyout of $7.65 million. 

Thursday, November 13, 2014

XL Pipeline

All the hoopla over the Keystone XL Pipeline.

As I've said before, I'll say again

Just build it!

Jobs

Jobs

Jobs

Tuesday, November 11, 2014

Veteran's Day


Sam Beimer
Camp Adair
or 
Fort Leonard Wood
1944


Thursday, November 6, 2014

Throwback Thursday Election Returns

 They don't wear jackets like this on TV any more.

In those days we wrote in the number of votes on the yellow pad below the candidates name.

It was more fun!

(This was a primary election night broadcast on KOAT-TV)