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    CPS Energy OKs spending $350 million to extend its STEP conservation program for 5 years

    May 24, 2022 - Diego Mendoza-Moyers, San Antonio Express-News


      May 23—CPS Energy trustees on Monday approved spending $350 million over the next five years on the utility's energy efficiency and conservation initiative, keeping in place rebates and other programs it says have reduced emissions and held off the need for building another power plant.

      Known as the Save for Tomorrow Energy Plan, or STEP, the initiative came under fire last year as CPS faced a financial crunch that forced it to seek a rate increase, which was approved this year.

      But on Monday, trustees opted to extend STEP for another five years at an annual cost of $70 million. As in the past, CPS customers will pay an average $3.50 per month to fund it.

      "This new program continues with the simple mission of reducing the demand for power but has more innovative programs to incentivize and assist customers, including wider access to solar regardless of income," said interim CEO Rudy Garza. "This new proposal reflects the voice of our community and addresses bill savings, equity, emissions reduction, technology innovation to help business, homes and demand response."

      Trustees also considered options that would have scaled back STEP, and another that would have expanded it.

      The initiative is a constellation of about 20 programs designed to reduce the electricity needed to power the city. It does so by paying for such things as low-income customers getting new insulation in their homes and providing rebates for customers who purchase solar panels or energy efficient appliances.

      Since taking effect in 2008, CPS has spent $838 million through STEP to conserve roughly the output of its most recently built power plant, the coal-fired Spruce 2 unit, which can generate 878 megawatts of electricity.

      That price tag was among the reasons Trustee John Steen last fall took aim at STEP as it began considering a rate increase, arguing that ending the program could offset most of the rate increase on customers.

      As the focus on preventing climate change has intensified, utilities nationwide have relied on such efficiency and conservation programs to curb emissions and defer construction of new generating plants.

      But CPS expenses have also risen sharply, driven largely by increasing costs for natural gas. The average residential CPS bill in April was $136 for electric and gas service, a 20 percent increase from a year ago that was largely caused by higher prices for natural gas.

      Mayor Ron Nirenberg originally proposed an option that would have expanded STEP and increased the cost to customers to $5 on average each month. But he voted for the smaller option because of inflation and rising costs for customers.

      "I'd love to support an expanded program," he said. "But considering where we are, and how the costs rising for everyone across the board from milk to rent, we've got to be mindful of that and not go too fast."

      Trustee Francine Romero pushed for the larger option as a method to cut emissions and combat climate change.

      "We need to do more to meet this challenge. We've never had a May as hot as this May," she said. "For us to not add the additional $1.50 a month to provide an expanded program — I feel like we're not fulfilling our mission."

      Part of Steen's criticism is that the solar rebates, a major component of STEP, have largely benefited more wealthy homeowners in San Antonio who can afford the large up-front costs of a rooftop solar system and later receive a credit. Steen also called STEP a "consumption tax" on customers.

      He voted against extending STEP beyond its expiration in July.

      "The solar program was really benefiting more affluent areas, but you're, in effect, taxing our 900,000 customers to do these types of projects," he said.

      Since 2009, CPS has paid $153 million in rebates to customers to install solar panels. For residential solar projects, the rebate is worth at least $2,500.

      But CPS has said it plans to move away from rebates for solar systems in favor of more accessible solar programs. That could include more community solar projects, such as large solar installations that allow CPS customers to purchase as little as a single solar panel for a few hundred dollars.

      "The challenge we've had with solar rebates has been that those systems are expensive. You've got to have $30,000," said Rick Luna, director of technology and product innovation for CPS. "How do we pivot to things where we can lower barriers? Like community solar, where I can buy one panel, and that's a much more manageable investment for people."


      (c)2022 the San Antonio Express-News

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      Distributed by Tribune Content Agency, LLC.


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