Three vital advantages of municipal utilities

bob massie president new economics instituteBob Massie of America’s New Economics Institute sent news today that voters in Boulder, Colorado, have ended their relationship with Xcel Energy, a utility with $10.7 billion in revenues, clearing the way for the city to form its own municipal utility that would lower rates and make greater use of renewable energy.

The city’s ‘multiple pleas’ for more clean wind and solar power had been turned down by Xcel which then financed a new coal power plant.

boulder cycle demo

During a vigorous campaign that attracted national attention, corporate executives and their allies mounted a well-funded operation, arguing that the city had neither the money nor the expertise to manage such a complex enterprise.

boulder graphicAdvocates for the municipal utility, including the New Era Colorado Foundation, fought back with a successful crowd-funding campaign, attracting public attention with imaginative activities.

There are 1000 municipal utilities in the United States, serving 50 million customers. Most  are owned by cities, and controlled by panels of local citizens. Some are cooperatives owned by their members.

boulder john farrellJohn Farrell, who directs the Energy Self-Reliant States and Communities program at the Institute for Local Self-Reliance, points out that if the city moves ahead, it would capture nearly $100 million currently spent on electricity imports and create up to $350 million in local economic development by dramatically increasing local clean energy production.

Proponents of change have argued that public control creates three vital benefits:

  • First, decisions are made not by distant corporate managers whose first priority is to generate returns for absentee shareholders or to pay enormous salaries for executives, but by managers who are accountable to the community.
  • Second, because of this, municipal utilities can focus on important local goals, such as investing in renewable energy, efficiency, and other factors that increase community resilience.
  • And finally, the rates of municipal utilities are traditionally lower than their counterparts, and they channel any financial surplus — also known as profit — back into the community.

 boulder poster

Massie comments: “The entire model of a corporate utility operating a centralized grid is facing steady erosion. Universities and cities across the country are expressing their desire to move away from both hiring — or even owning stocks — in companies that remain committed to fossil fuels. In addition, every family who installs solar on their roof not only slashes their need for energy from a utility, but also cuts the revenue for those same firms.”

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2013 watershed: rebuilding local economies

A recent message came from Bob Massie, the president of the New Economics Institute, based in Massachusetts, which grew from E. F. Schumacher Society, in close partnership with Britain’s new economics foundation. It opened by saying that 2013 is likely to be a watershed year:

“A tremendous number of people around the country understand that the system is broken, and that we must work to replace it with something different, something new. Many of these people have already rolled up their sleeves and gotten to work in their local communities. Many others are just waiting for the opportunity. Our plan is to bring these people together with like-minded organizations and leaders to a build a movement to propel America toward a New Economy. . .

“Most people know that our current economy is leading us in the wrong direction. They want to see change and progress – but they aren’t yet part of a shared vision of what that change looks like. The New Economy is about democracy, resiliency, and community . . .

“There are many outstanding organizations committed to building the New Economy. From launching cooperative businesses or community time banks to working to create public banking legislation, more and more people are creating the transition to a just and sustainable economy, now . . . “

Chandran Nair would welcome Massie’s news that:

“There is tremendous energy among college students toward building a movement for the New Economy. When we announced that we would be supporting Strategic Summits on eight campuses this spring, we received over 70 letters of interest from student groups from Hawaii to Maine! These students are already at work raising awareness and building strong collaborations with local communities.

”We believe this will inspire a nationwide movement in 2013 among college students and create a powerful network of leaders committed to building a just and sustainable economy.”

Its fifth project, called TOWARD A NEW ENTERPRISE ECONOMY, aims to:

“Draw in people from all sides of the political spectrum by focusing on how to rebuild local economies through using the skills, imagination, and enterprise of the people who live there. Find ways to make global interconnectedness a positive reality for all”.