On a new episode of the Grid Forward Forum podcast, the CEOs at Holy Cross Energy and United Power had a candid discussion about how smaller public utilities are tackling current challenges and opportunities. These two co-ops serve very different Colorado geographies: from the mountainous Rockies for Holy Cross to the vast hills and plains surrounding Denver for United Power. Even so, the two leaders expressed the same shift away from traditional “hub and spoke” service to a network model similar to a distribution system operator (DSO).
These co-ops are building the future of the grid today by engaging customer generation and flexing supply to meet expanding load, increase resilience, and deliver value for the customers and the utility. Read this excerpt from this podcast episode and listen to the whole episode for more insights from these leaders.
Grid Forward Forum is a podcast focused on utilities, tech providers, regulators and others helping to advance the electric grid. You can hear all the episodes on the Grid Forward website or your favorite podcast app.
This excerpt was lightly edited for continuity
Bryce Yonker, executive director and CEO, Grid Forward: What are you all prioritizing as far as what it looks like to get the necessary power to your community from a supply side? And how does that dynamic impact the way that you are leveraging the demand side?
Mark Gabriel, President & CEO, United Power: In the last 12 months, United Power has added 115MW of battery storage. We have what I know is the largest distributed battery system in Colorado, maybe the country, because we have batteries at nine separate substations ranging from 8MW to 33MW. We distributed it across our system for several reasons. First and foremost is I do not like all my eggs in one basket to use an overused expression. I do not want to put 100MW in one spot. I think there are physical and cyber risks that exist that way. But more importantly for us, it gives us resilience at the distribution level on specific feeders.
Bryan Hannegan, President & CEO, Holy Cross Energy: Bryce, it’s very much about flexing the demand side to meet available supply as much as it is flexing the supply like we’ve always done, ramping up and ramping down power plants.
If you think about consumers already investing their capital in electric vehicles, hot water heaters, battery storage, all of the things, our design principle is to figure out how those investments can be leveraged to create both value to the consumer and value to the cooperative.
A really good example of this is our Power Plus program, where we’re helping our members get batteries for their homes or for their businesses by putting together rebates, the monetization by us of the tax incentives, the federal tax credits, creating a capacity payment where we pay a bill credit that lowers the loan payment on the battery from the consumer in exchange for being able to use that battery as a grid resource when the consumer doesn’t need it. And then using our balance sheet to provide on bill financing at a much lower rate than they could get elsewhere in the market.
When all that is said and done, today’s Holy Cross member can get a set of not just one, but a set of batteries for their home for 15 additional dollars per month added to their electric bill. This screaming deal provides energy resilience to the individual consumer, but also provides us with a measure of flexibility that we need to be that distribution grid operator in the future with very high renewables.
Mark Gabriel: Bryan and I share a history with the Electric Power Research Institute, and I remember conversations as far back as 25 years ago where we talked about this idea of how to control and manage at the edge of the grid. Today, we finally have technologies that we could only dream about 20 years ago. The combination of communications, control, markets, and understanding of how things actually operate on the system makes it exciting, and it is a future that I think we dreamt of 20 years ago.
Bryce Yonker: Where do you see public power kind of across the country going? What does it look like to be directly responsible to the community that you serve?
Mark Gabriel: I have worked for IOUs. I worked with munis (municipal entities) and co-ops. The fact that we are beholden to our member-owners really changes the dynamic of how we think about the whole system and how we have to operate. We are not beholden to shareholders. We are truly in the game of helping our members. And in fact, when we do well, they do well, right? They get capital credits. It also allows us to operate much more quickly and make decisions in a in a timely fashion.
It also ties us tightly to our communities. One of the reasons United Power has focused on hyper localization is it also adds to the local tax base. And what do I mean by that? On June 1st we will be opening up a 162MW natural gas facility that is tied to one of our substations, where we have 11MW of batteries. What does that result in? That results in additional tax revenues for Weld County, certainly for the state, but for Weld County. So, we think about it a little bit differently.
Bryce Yonker: One topic relative to serving members that’s really top of mind for the whole industry. Can we talk a little bit about resilience and the sort of extreme threats that we’re seeing on the grid?
Bryan Hannegan: Reliability is job number one. If we can’t safely operate our system and provide reliable service, then it’s the proverbial one thing. Get it right. So we prioritize that safety and reliability at every step.
Just a couple of ways in which we do that. Number one, and it’s simple, and we can all do it as Mark said: understand the physics. Measure, monitor, sense, build your system with multiple redundancies, so that when an outage does occur, and it will, you have the ability to reroute power, just like we reroute traffic when there’s an accident on the highway.
We’ve been investing in technologies that allow us to go directly to the location of the fault for quicker restoration, to be able to isolate it and get more people back on more quickly before we even roll the truck and send a crew out into the field. Sometimes we can restore nearly all of the power service without sending a truck forward.
The western part of the state is going through an extended period of drought. So we have an extensive wildfire mitigation program that is going through and hardening our system and looking for causes of sparks and other things, repairing and maintaining equipment, flying drones, using thermal sensors, using satellite data to understand where the trees are diseased or dying so that we can cut them before they fall and maintain our rights of way accordingly. So many good technology opportunities to optimize how we keep that system safe and reliable going forward.
And then the last piece will be, you know, when we do have outages, these have consequences. We had a wildfire in the Roaring Fork Valley in 2019 where we came one burning pole away from losing a transmission line for weeks. And without that transmission line, there would be no power for clean water, no power to handle waste, no power to keep the telephone service working, the mobile phones and the internet. No power to the first responders to the emergency operations center. No power to the airport. Couldn’t get goods in. Couldn’t get people out. A really bad day at the far end of a mountain canyon.
So that got us to thinking, well, if we’re going to invest in new electricity supply resources, why would we site them 150 miles away if we could do it right here in our own backyard? And so all of our projects that have been sourced for Holy Cross, that are of the solar-plus-battery storage variety are sited within proximate locations in our communities to provide a certain amount of energy resilience, not infinite, but a certain amount—4, 6, 12 hours. So our first responders and our local leaders can know that they’ve got some precious first few hours to execute on their longer term plans, and that we have the power to keep people safe and healthy and in contact with their loved ones exactly at the time when they most need it.
On those days where we don’t need that power for an emergency, those resources can become flexible sources of clean electricity right here in our community. Unlike Mark and United, where they put the batteries at the substations, we put the batteries at the solar farm. And what that allows us to do is meter the flow both up and down of electricity from the solar panels onto the grid in a way that we can control, that can fill gaps in our portfolio, that can help us meet that balance of supply and demand that we need to meet in all locations and at all times to provide reliable service.
It’s a different mindset, going back to our earlier conversation. It’s about being creative and innovative now and thinking, how can I get two for one, three for one leverage in terms of the investments that we’re making, not just doing the same old thing that we used to do because the world is different. Our member consumers want different. Our realities are different with the threats that we’re facing. And our role is different as a kind of a balancer and an optimizer of all the things getting connected to the grid, both supply and demand.
