Lower debt, higher wholesale sales allows CPS Energy to delay planned rate increase

cps energy logo

CPS Energy will once again be able to eliminate a rate increase request initially planned to take effect in February 2016.

This is the second time the company has been able to extend the time between rate increase requests, thanks to continued diligent streamlining of our business processes, lower debt costs and increased sales of wholesale electricity.

When CPS Energy came before the community seeking a rate adjustment for 2008, we shared plans which showed the need to seek rate increases every other year for the next decade, to pay for additional growth, environmental compliance and system maintenance.

As our regulator, the San Antonio City Council approved the next planned rate increase, which went into effect in 2010. In 2011, CPS Energy was able to delay our next planned request until 2013. In October of that year, the council approved a 4.25 percent rate adjustment, which went into effect this February.

At that time, we outlined to the council the anticipated need to ask for a 5.25 percent adjustment next year, to take effect in February 2016.

But as in 2012, we now do not need to make that request. Barring unlikely circumstances, we will not need to seek an increase until late 2017, which would go into effect February of 2018.

Several factors allowed for this change. Visit CPS Energy’s blog to read more.




Mission Solar Energy now manufacturing ‘made-in-San Antonio’ solar panels

cps energy logoCPS Energy already has more than 130 megawatts of solar power online, bringing clean, renewable energy to customers.

Another 300 MW of sun power is on the way, and that means a lot of solar panels. The good news is, all of those panels will be made right here in San Antonio.

Alamo 1, the first solar farm built as part of our 400-MW agreement with OCI Solar Power, relies on 167,000 panels to generate 45 MW of clean energy. Really… 167,000 panels. Alamo 2, a 4.5 MW farm located on the northeast side, uses 18,000. The latest, a 39 MW farm located in Brackettville, 124 miles west of San Antonio, relies on 150,000 panels.

Four more farms will be built in San Antonio and around Texas over the next three years to complete the agreement. That’s a lot of silicon.

MissionSolar2-617x352Mission Solar Energy employees closely inspect a solar panel for flaws

The panels for the first three OCI Solar Power farms were produced by a foreign manufacturer before Mission Solar Energy set up shop here in San Antonio. The local headquarters and production facility is one of seven new energy companies that have relocated here as part of CPS Energy’s New Energy Economy initiative.

Today, Mission Solar is the only solar panel manufacturing facility in Texas and the only n-type solar manufacturing facility in the country.

“There are two types of silicon used in solar cell manufacturing: p-type and n-type,” says Alex Kim, president and CEO of Mission Solar. “We use n-type because it has a higher efficiency and lasts longer.”

The new 240,000 square foot facility at Brooks City Base (which officially celebrated its opening on Mon., Sept. 22) will manufacture panels exclusively for the remaining OCI Solar farms for the next three years. After that, Mission Solar will target residential and commercial markets.

The Texas-sized factory has a 90,000 square foot “clean” cell manufacturing area. Employees wear lab coats and gloves, and operate multiple inspection stations, to make sure finished solar cells are high quality and offer maximum electrical generation.

Each finished six-by-six inch cell becomes part of a 72-cell panel. The panels are capable of generating up to 325 watts of power each.

“We currently run 50 panels an hour  and will double that once when we’re in full production – all for OCI Solar through 2017,” says Kim.

Mission Solar will soon produce modules 24 hours a day, seven days a week. The company will move from one to two lines next year, to produce up to 200 megawatts of manufactured solar power annually. A move to residential production in three years means panels made here may wind up on the homes of you and your neighbors someday.

Yep, homegrown solar power – just like buying a Toyota Tundra made right here in San Antonio.

Mission Solar will need as many as 400 employees for full operation. Already, more the 240, some trained through workforce training programs at the Alamo Colleges, are on board. Almost one out of every five employees are veterans – now working on land once dedicated to the missions of a former Air Force base.

Related Stories:
OCI Solar Power uses sheep as “lambscapers” at solar farm
For sale: residential solar inverters made in San Antonio by KACO
CPS Energy looking to grow rooftop and community solar
San Antonio, now 6th in nation, lauded for solar growth


Volunteer Spotlight: Lisa Lewis, CPS Energy – Social U Chair

Lewis_Lisa-vLisa Lewis
CPS Energy

About the Company: Lisa Lewis is Vice President of Corporate Communications & Media Relations for CPS Energy, the nation’s largest municipally owned energy utility providing both natural gas and electric service in and around the seventh-largest city in the nation. Lewis joined CPS Energy’s Marketing team in 2001, and manages internal and external communications, corporate responsibility, branding and social media. Before joining CPS Energy, Lisa worked in the advertising industry with service-industry clients from healthcare to transit.

About the Program: The Social Media Committee works to deliver quality instruction in social and digital media marketing for non-profit and corporate marketing/PR tacticians, and small- to mid-sized business owners, executives and managers who utilize social media or are interested in trends and tactics and how they affect profitability. Social U is a social media university for savvy marketers and features instruction, discussion and networking among local thought, strategy and implementation leaders in social and digital media as well as an interactive social media experience on event day.

Personally Speaking: Lisa, who sits on the North SA Chamber board of directors, says, “Social U has created great interaction among communications professionals across our city.” Lisa says she enjoys the discussion at events and committee meetings, “I have the pleasure of working with great communicators: lifelong pros, bright young hotshots, brand experts – among the volunteers and the Chamber staff.” Lisa explains that most marketers are still learning when it comes to digital and social media, and she says, “Social U is a great forum for this type of professional education.”

San Antonio’s budding solar industry is going vertical

cps energy logoLocal solar installers can now buy locally made inverters, and pretty soon, they’ll be able to buy locally-made panels too.

KACO new energy just cranked up production of 3.5 and 5 kilowatt inverters, the first residential inverters manufactured in the state of Texas and the first in San Antonio. That means local solar installers can circumvent shipping fees and buy the inverters direct from the manufacturer, saving money and impacts on the environment.

“It makes so much sense to support homegrown solar,” said Bradley Feuge, customer project manager for KACO, San Antonio’s homegrown solar inverter manufacturing company. KACO is one of seven new energy companies that have taken root in San Antonio since CPS Energy launched its New Energy Economy initiative back in 2011.

KACO-Res-Line-One-2-596x335CPS Energy’s New Energy Economy partner KACO new energy’s solar inverter plant is state of the art

Local solar industry advocates approve of the new outlet for inverters. “We’re really happy that the residential solar industry can now use local products made right here in San Antonio,” said Devon Rood, spokesperson for Solar San Antonio.

Those not in the solar business may be wondering: what the heck is a solar inverter?

Well, it goes back to Electricity 101. Electricity created by sunshine comes in as direct current (DC). In order to get it onto the grid and eventually to your home, that electricity must be converted to alternating current (AC).

Why?” Because the standard for power generation and transmission is Alternating Current (AC),” explains Feuge.

Feuge alludes to the “War of the Currents” which took place in the 1880s. Thomas Edison and George Westinghouse waged a war of competing technologies–Edison pushing DC and Westinghouse AC–as the standards for electrical distribution.

AC prevailed for one simple reason: it’s cheaper to transmit power over long distances using alternating current — from a power plant to your house, for example. However, electronics like tablets, laptops and yes, the smart phone, use DC. So while AC arrives in your home, it is soon converted back to DC to charge and power our beloved devices.

Generating solar power requires photovoltaic cells which comprise solar panels, also known as modules. Those panels send DC current to the inverter, which converts it to AC current so it can move onto the grid for community use.

Won’t be long, and San Antonio will claim its first homegrown solar panel manufacturing facility too. Mission Solar, another one of CPS Energy’s New Energy Economy partners company. The solar company, housed at Brooks City Base, starts full-scale production in September.

“It’s all part of our plan to build a local solar economy,” said Cris Eugster, Executive Vice President and Chief Generation and Strategy Officer.

Local solar installers can contact KACO’s Jim Pietras at 210-625-3776 for pricing and pick-up details.

By Monika Maeckle

Related stories from Energized, CPS Energy’s blog:
KACO inverter plant brings jobs to San Antonio
New Energy Economy impacted estimated at $622 million, more to come
Powering jobs in the New Energy Eocnomy

New options to save energy and money this summer from CPS Energy

cps energy logoWe all know it’s going to be a hot summer, but an El Nino weather pattern could potentially bring even warmer than normal temperatures to the area. Combine that with natural with gas prices that remain high following the harsh winter, and you’re looking at higher than average summer energy bills.

Luckily, CPS Energy has expanded its demand response programs, including new ones that work with window units as well as central air conditioning systems. They help customers lower their bills and help the utility use less power when it’s most expensive (and that keeps costs down for all of us).

The average residential customer is expected to use 1,572 kilowatt hours of electricity per month from June through September, resulting in a bill of $174.37. That’s up about $21 from average bills from the previous summer.

That potential increase means there’s a strong need for energy conservation, said Executive Vice President Jelynne LeBlanc Burley, “so we’re doing everything possible to help our customers lower the amount of energy they’re buying. It gives them a smaller bill and reduces demand on the state grid.

“We have everything from an average of $5,000 of free weatherization improvements for qualifying customers to a kit that allows customers to program their window AC units. We’ve also added rebates for the popular Nest Learning Thermostat™,” she added.

Customers can decrease the amount of energy they use and buy through a number of energy efficient options, including:

  • Casa Verde weatherization program (free) – average of $5,000 in improvements decreases average bill by $27
  • Friedrich’s Kühl Window AC unit – programmable unit to manage temperature settings
  • Nest Learning Thermostat™ – learns temperature preferences and programs itself allowing customer to manage temperature with a smart phone or computer
  • Home Manager (free) – saves an average of 10 percent by allowing customer to manage central AC, electric water heater and pool pump with a computer, smart phone or tablet
  • Smart Thermostat (free) – Honeywell programmable thermostat allows customer to manage temperature using computer or laptop
  • Cool Energy Program smartAC kit (free) – wireless smart plug for existing window AC allows customer to manage temperature with a smart phone or computer.

Most of those are part of CPS Energy’s Demand Response programs, which allows CPS Energy to briefly bump up your thermostat a couple degrees on the hottest summer afternoons, when demand peaks. Customers receive a credit on their bill at the end of the season, which goes through September, for participating.

Customers also can take advantage of rebates for air duct systemsrefrigeratorsAC unitssolar systems and more by visiting cpsenergysavers.com. Energy efficiency tips such as setting a thermostat between 78 – 80 degrees and raising the temperature several degrees when leaving a home for several hours are more ways to save.

Families experiencing financial hardships and military veterans burned during service can get bill assistance through a variety of programs. CPS Energy commits a minimum of $1 million annually to the Residential Energy Assistance Program (REAP). Last year, customers partnering with their energy provider contributed more than $200,000 to assist local neighbors in need.


GreenStar’s LEDs: an illuminating way to give back to San Antonio

cps energy logoWhen Paul Duran started GreenStar in a small warehouse in Boerne in 2009, he was trying to solve the heating problem created by traditional incandescent lights in the electric refrigerated truck bodies he was manufacturing.

LED lights, he knew, created as much illumination as traditional bulbs, but with the ability to dissipate heat , while using a third of the power.

With traditional bulbs, “you basically heat up a piece of metal so hot it emits light,” said Gabriel Senior, GreenStar’s vice-president of sales and marketing. “With LEDs, you’re exciting electrons, and that emits light. It’s a huge paradigm shift in lighting technology.”

Just five short years after the company began, GreenStar is now a wholly owned subsidiary of Toshiba Lighting and Technologies, with its Americas headquarters in San Antonio and selling to municipalities and commercial businesses worldwide — and it’s just recently installed its 50,000th LED light.

Of those, more than 14,000 are now illuminating many of San Antonio’s main thoroughfares, as part of a deal between CPS Energy, GreenStar and the city of San Antonio. The company was one of CPS Energy’s first New Energy Economy partners.

When the upgrade is complete this summer, 25,000 LED streetlights will offer San Antonio drivers brighter, more natural looking and more direct, not to mention longer-lasting illumination of city streets — and use 60 to 70 percent less energy to do so.

Together, the 50,000 lights installed worldwide thus far by GreenStar have saved 10 megawatts of power, according to the company. Annually, that’s 47,000 megawatt hours of power not needed.

LED Lighting-29Since the cleanest energy is that which isn’t used, not generating that 10 MW has avoided spewing 74 million pounds of CO2 emissions per year into the air. That’s the equivalent of getting more than 6,500 cars off the road.

Customers who’ve installed those lights are enjoying the financial benefits, too. GreenStar estimates that together they’ve saved $4 million in energy costs, plus another $2 million in avoided maintenance costs, since GreenStar’s LED lights can last for more than a decade.

LED Lights Greenstar-27And they’re being manufactured right here in San Antonio, employing more than 40 people — almost double the company’s workforce from just a year ago. A giant “We’re Hiring” banner hangs over the entrance to the modular manufacturing site on the city’s far West Side.

“We’re hiring for assembly, warehouse and quality assurance roles on two shifts,” said Tom Wright, vice-president of operations. He said the company manufacturing strategy allows it to quickly and easily increase its production capacity based on customer needs.

Research and development is now headquartered in New Delhi, and employs another 40 or so there.

And while components and parts come from all over the world, GreenStar sources locally whenever it can, said Wright.

“We’ve calculated that about 20-25 percent of what we spend stays right here in San Antonio,” he said, “hundreds and thousands going to other small businesses here each year — and that’s not including payroll.”

The company has made giving back part of its ethos; as part of its deal with CPS Energy, GreenStar agreed to contribute $10 to the University of Texas’ College of Engineering for every light fixture the firm sold to the city.

“This green economy is a new business and we need to teach our kids what it is all about,” Paul Duran told the UTSA publication Giving in the summer of 2012, noting that none of the 14 engineers on his staff at the time were from San Antonio.

The money was used to endow the GreenStar Energy Engineering Professorship in the College of Engineering — the college’s first energy-related endowed professorship.

“It’s just another example of how the new energy economy is coming into play here in San Antonio,” said Wright. “GreenStar is extremely proud of its economic and environmental contributions to not only San Antonio, but the world thus far — and is looking forward to continued growth and a very bright future.”

This story originally appeared in Energized, CPS Energy’s blog.

CPS Energy expands social media presence in Facebook, Twitter and YouTube to reach customers quickly

cps energy logoWhen police alerted CPS Energy that a man posing as a utility employee gained entrance into a house on the city’s West Side with the intent to assault the resident, CPS Energy’s communications team swung into action.

After quickly calling a joint press conference with police to remind customers they can verify an employee by asking to see ID and calling CPS Energy, the team turned to social media.

The team posted the same information on CPS Energy’s Facebook page and Twitter account. All day long, customers who follow CPS Energy on Twitter retweeted the information, while Facebook fans shared it with their friends, sending our message out to a much wider audience.

The week before, the team alerted customers of two localized power outages on Facebook. Reaction was swift. Customers let CPS Energy know their power was out and where, and then again when it was restored.

Customer William Long wrote, “I called non-emergency about 20 minutes ago to let them know the traffic lights are out at Tammy/Blanco… but it seems you may already know that. Thanks for posting!”

After power was restored, Long wrote, “Great use of social media!”

“I like it that you have a Facebook page, CPS,” wrote another customer. “Thanks.”

Like many companies today, CPS Energy has expanded its presence on social media outlets like Facebook, Twitter and YouTube because those have become important ways to reach customers quickly.

“It’s no longer an option, we must participate,” said Kate Cooper, CPS Energy’s social media project manager. “We need to engage the customer where they are — and they’re on social media.”

In the past, Cooper said, customers would call, and later email CPS Energy when they had an issue or wanted to report a power outage. Today, she said, it’s more common, especially for younger customers, to send CPS Energy a message from their mobile devices to Facebook or Twitter.

CPS Energy, in turn, can keep customers updated during power outages, letting people know crews are on the way, or about how long they’ll have to wait until the power comes back on.

“People are appreciative of getting information,” Cooper said, “and knowing someone is listening to their concerns.”

CPS Energy uses social media to remind customers about different ways to save money and how to be more energy efficient. It’s also a way to remind people, Cooper said, “that there are people behind the logo — we’re your neighbors.”

The social media team is comprised of employees in CPS Energy’s corporate communications office, who have taken on social media duties in addition to their regular jobs.

Last year, CPS Energy also launched the Energized, blog, which allows the utility to tell its own story. Recent articles have included the background behind CPS Energy’s decision to alter its solar payment system, how and why the company pays bonuses when performance metrics are met, and that employees and partner companies recently raised more than $80,000 for Respite Care of San Antonio.

There will always be a place for traditional media like television and newspapers, and customers will always be able to call when they need to pay a bill or discuss an issue.

But as our customers come to rely more and more on social media to stay on top of the news of the day, and to share their own lives, CPS Energy will be there.

CPS Energy pay performance

cps energy logoA recent story in the San Antonio Express-News trumpeted this astounding figure: the pay for senior executives at CPS Energy has “soared” by 58 percent since 2010.

A wider look at the data shows, however, tells a much different story.

Executive pay has increased dramatically since 2010, because in fiscal 2009, executives did not meet performance goals and so didn’t earn incentive pay. The following two years, two of the strongest in the company’s history, those goals were met, and bonuses, which account for almost one-third of executive salaries, were paid out.

Looking at salaries from 2008 to 2012, senior executives saw their pay increase by 4.5 percent. That’s compared to a 19 percent increase in non-executive salaries over the same period.

CPS energy salaries

This chart, published in the San Antonio Express-News, shows CPS Energy compensation over the last five years.

While 4.5 percent is far less dramatic, and doesn’t make for nearly as shocking of a headline, it’s still important to understand how compensation is structured at San Antonio’s municipally owned utility, and why bonuses were paid the past two years.

For the second year in a row, CPS Energy’s electric reliability is within the top tier of the industry, its employees have increased safety to a record high, and customer satisfaction remains high.

That’s what the San Antonio City Council heard at an April work session from CPS Energy CEO Doyle Beneby, who also offered an update on the state of the energy industry and the city-owned utility’s overall strategic plan.

CPS Energy is recognized as having the premier credit rating in the industry by Bank of America/Merrill Lynch, a position bolstered by a continued focus on cost efficiency and process improvements within the company.

As a result, operations and maintenance costs per CPS Energy customer continue to drop, from $368 to $345 per person, with a goal of $333 per person by 2015. At the same time, employees continue to work more efficiently. That has resulted in a leaner workforce, from a high of almost 4,300 in 2001 to about 3,400 today.

Meanwhile, capital costs decreased from fiscal year 2012, while operations and maintenance holds steady for the next two fiscal years. Because of that, the budget for 2013 did not include a rate increase.

Rates for CPS Energy customers remain some of the lowest in Texas, and the lowest among the largest 20 cities in the country.

Beneby also highlighted CPS Energy’s stepped-up commitment to economic development. The utility’s New Energy Economy partners, including OCI Solar Power, GreenStar, Silver Spring Network and Consert, among others, have made $88 million in investments in the San Antonio region to date, including the creation of 154 jobs and $1.5 million that has been donated to local educational initiatives.

Those partners are on track to meet their commitments to create more than 1,000 jobs by 2018, Beneby said, with investments topping $974 million.

For all these reasons, CPS Energy employees earned incentive pay the past two years.

The utility has had an incentive program in place for 13 years now, to encourage top performance for safety, budget management, low bills, customer satisfaction and care for the environment.

Instead of giving higher base salaries, CPS Energy prefers to have lower base salaries, encouraging strong performance with the opportunity to earn more by meeting company-wide goals.

“Incentives are just one part of a total compensation package that is designed to deliver strong performance rather than guarantee a higher salary,” Lisa Lewis, vice-president of communications and media relations, told the Express-News. “We prefer to put a part of that salary at risk.”

Those bonuses don’t boost salaries beyond the market rate, however.

CPS Energy employees’ salaries are regularly compared to salaries for similar utilities across the region and nation.

A recent study found that including bonuses and benefits, top executives are paid somewhat less than the industry standard for similarly-sized energy companies, while most employees are paid within range of competitive market rates.

Employees do not always meet their annual goals. In fiscal year 2009, only non-executive employees met and were paid for meeting the company’s safety goal that year. Executives didn’t receive incentive pay at all – hence the dip in their salaries, making the increase of the following two years more dramatic.

This year, executives earned a 32 percent bonus; more of their pay is at risk, notes Lewis, because they have the most responsibility for meeting annual performance goals.

Most employees have between 25 percent and 7 percent of their salary at risk. One group of hourly employees has chosen, as part of their working agreement with CPS Energy, to have just one percent of their pay at risk.

Taken together, this year’s bonuses totaled $16.2 million, or 6 percent of CPS Energy’s total labor budget.

It is reasonable for the community to debate whether those bonuses are fair, said Lewis, and she noted that there are different ways to structure compensation.

Some utilities simply guarantee a salary, for example, while others only offer incentive pay to top executives.

“CPS Energy has looked for a way that gets the maximum value for our customers, by incenting our employees to work together to achieve common goals, and by putting part of employees pay at risk, rather than guaranteeing a higher salary. In 2011 and 2012, CPS Energy employees have shown that it can work.”

Read more on CPS Energy Blog


Did you know spending money on new lighting can actually make you money?

TritonThanks to advanced lighting technologies such as LED technology, there has never been a better time to upgrade your facility or building and get it paid for by using other people’s money and the power of leverage while potentially putting cash in your company’s pocket immediately. High-efficiency upgrades can save your business lots of money while improving the light quality and output in your buildings. Businesses both large and small are eligible for commercial lighting rebates regardless of the size of the upgrade … up to 40% in rebates in many cases! When the project is financed, the savings should more than cover the payments with some cash left over compared to what was budgeted for those higher energy bills. Lighting upgrades and retrofits present the easiest opportunities for organizations to make dramatic, long-lasting improvements in efficiency, especially during these times of fiscal uncertainty. Energy cost reductions make huge differences in a company’s bottom line. After payroll, energy is part of the largest operating costs for most business operations.

According to North Chamber member, Dr. Edward Sakiewicz, President & Managing Partner of Triton Energy Solutions, “Lighting expenses account for at least 43% of a company’s energy expenses. It is our job to educate decision makers about the government incentives that are now available that will not only help reduce their energy consumption, but motivate them to get their projects done now while incentives and rebates are still available. It’s all about illumi­nating their businesses and their bottom line.” So if you could have an opportunity to retrofit and/or upgrade your lighting system for $50,000.00, for example, then get 40% back through rebates, then add in tax incentives where applicable, while saving anywhere from 50%-80% on your monthly energy bill, is that a financial no-brainer, or what?

Companies today are getting more and more pressure to become more sustainable and green-conscious by adopting more energy-efficient methods of operating their enterprises. Triton Energy So­lutions predicts new standards will continue to be raised, but warns that available rebates and other incentives are significantly decreasing every year. In fact, the signs are already here where locally, rebates were up to 75% on lighting just a couple of years ago. Now, in 2013, it has dropped significantly to 40% or less. Jennyfer Sakiewicz, Chief Operating Officer & Managing Partner states, “We’re committed to keeping abreast of those standards so that we can educate and alert our customers to these facts and lead the marketplace with the best products, systems and services available”.

So don’t wait …get your rebate! Call Triton Energy Solutions today for a FREE, no-obligation energy audit at 210/735-4866 and let us illuminate your bottom line.

CIO Breakfast Chair: Manish Kapoor, NuStar Energy L.P.

Kapoor_ManishAbout the Company: NuStar Energy L.P. is one of the largest independent liquids terminal and pipeline operators in the nation. NuStar currently has 8,573 miles of pipeline; 87 terminal and storage facilities that store and distribute crude oil, refined products and specialty liquids. Manish Kapoor is Senior Vice President of Information Systems at NuStar Energy, L.P. He is responsible for providing Technology Infrastructure, Automation Technologies, Business Application Technologies, and Business Process Reengineering, as well as other activities.

About the Program: CIO breakfasts are a knowledge series designed exclusively for and by CIOs and is open to technology and IT executives. At monthly breakfasts, speakers discuss current and relevant technology issues and local IT leaders share experiences and ideas with their peers.

Personally Speaking: Manish says he has enjoyed the CIO Breakfast Series as it, “provides an environment for the local CIOs to share their problems and solutions in a vendor-free environment.” He adds, “The North Chamber plays an important role by helping to build the future technology workforce in the San Antonio area.”