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Connecticut Power Outage Shows Superiority of Community Ownership

Rob Cox, a writer for Reuters, has delved into the disappointing response of some investor-owned utilities in Connecticut following the recent blizzard, noting the better performance of muni power companies. Hurricane Irene recently revealed the similar superiority of muni electrics compared to the investor-owned in Massachusetts, prompting us to note the parallels with Wired West's initiative in Western Massachusetts. They have created an electric light coop to build a next-generation fiber-optic network out to everyone in the area.

And on the same day that Longmont embraced locally owned broadband in Colorado, nearby Boulder started the process of kicking Xcel out in favor of an electric grid that is accountable to the public.

So let's see what the New York Times has to say about municipal ownership of infrastructure. They begin by noting the many ways Connecticut Light and Power (the subsidiary of Northeast, an investor owned utility presently consolidating with another large IOU) has cut its maintenance spending over the last few years -- leaving many more power lines vulnerable to the tree-bending blizzard.

There’s even a near-perfect model of how Connecticut Light and Power could have done the job better. Norwich, Conn., a city of 40,000, has owned its own electric utility, as well as those for sewage, gas and water, for 107 years. Norwich Public Utilities’ customers pay, on average, a bit less than Connecticut Light and Power’s. Yet after this past weekend’s snow dump, power was out for only about 450 of its 22,000 customers — and for no more than an hour. As of Thursday morning, nearly half a million Connecticut Light and Power customers were still waiting for the lights to go on.

That’s not luck, either. After Irene hit, just 13 percent of the city’s customers lost their power for more than a day. Within three days, the whole of Norwich had been restored. It took more than a week for Connecticut Light and Power to fully restore power.

To reiterate, the publicly owned system is cheaper, more reliable, and responds more quickly in emergencies. Sounds like efficiency.

That makes it seem odd that Gov. Dannel P. Malloy has tended to appear alongside Connecticut Light and Power’s Mr. Butler and to support the utility, even though far more customers lost power than should have and restoration proceeded too slowly. There’s solid numerical evidence to justify Mr. Malloy’s berating Connecticut Light and Power and calling for Mr. Butler’s head on behalf of the citizens of his state.

And yet, we see the exact same response from elected officials in the face of a less efficient private sector -- they blindly embrace the private sector, pretending we have no other options.

Connecticut Light and Power Logo

In contrast to Connecticut Light and Power, Norwich’s electric unit last year increased operations and maintenance spending by 11 percent, to $2.9 million. Put another way, in 2010 Norwich allocated about $132 a customer to this line item in its accounts. Connecticut Light and Power reported maintenance, unadjusted for deferred expenses, of $96.5 million, or around $78 per client.

Well, that is curious. The publicly owned utility is able to charge less for power while spending more per ratepayer. And we know that more money from the local utility stays in the community whereas the absentee-owned companies result in fund flight.

It helps that the Norwich utilities are not slaves to the profit motive — though they hand 10 percent of gross revenue to the city.

Whoops! There goes the whole "they have an advantage because they don't pay taxes BS argument...

Last year, before paying this slice to the city, the electricity division made just a 3.6 percent operating profit margin on its $52.3 million of revenue. The Connecticut Light and Power division of Northeast, meanwhile, booked $3 billion of revenue last year and reported an operating margin nearly five times the size of Norwich’s. But it surely also helps that Norwich Public Utilities’ general manager, 12 linemen and five commissioners live in the community, drive the local roads, see the overhanging branches and bump into their customers at the Norwichtown Mall. That’s a rare kind of accountability.

It shouldn't be a "rare" kind of accountability if we recognized the limits of where the private sector excels and encouraged it to "tend to its knitting" as my grandma says.

Photo, courtesy of autowitch on flickr.

Longmont Chooses Local Self-Reliance

What a difference two years and a strong grassroots campaign makes. Two years ago, Comcast's ability to spend $245,000 on a campaign of lies was the determining factor over Longmont's decision about using publicly owned infrastructure to expand broadband competition.

Yesterday, despite Comcast spending even more by again funneling hundreds of thousands through the Colorado Cable Telecommunications Commission, voters overwhelmingly supported question 2A - reinstating local government authority to offer telecommunications services using its infrastructure.

Full congratulations must go to the Longmont citizens who organized a truly grassroots campaign that sent people out on the streets with signs, organized informational events, disseminated press releases, maintained an information web page (and Facebook page), wrote letters to the editor, commented on online news stories, and otherwise educated their peers about the opportunity 2A offered. Craig Settles is also celebrating with a post describing the victory.

Once again, the question was:

Without increasing taxes, shall the citizens of the City of Longmont, Colorado, re-establish their City's right to provide all services restricted since 2005 by Title 29, article 27 of the Colorado Revised Statutes, described as "advanced services," "telecommunications services" and "cable television services," including any new and improved high bandwidth services based on future technologies, utilizing community owned infrastructure including but not limited to the existing fiber optic network, either directly or indirectly with public or private sector partners, to potential subscribers that may include telecommunications service providers, residential or commercial users within the City and the service area of the City's electric utility enterprise?

Question 2A results

The results were 60.8% Yes, 39.2% No. 13,238 voted yes whereas 8,529 voted against.

The Times-Call has already posted a story about the results, including some curious points from the pro-Comcast group's spokesman (and Denver resident) George Merritt.

"While we remain concerned about the disappointing track record of municipal telecoms, we hope our city has learned from the mistakes made by other cities and that taxpayers are protected with whatever venture develops as a result of the passage of Question 2A," Merritt said.

Despite spending probably over $300,000 (we won't know for a few days), Comcast and allies couldn't even find a Longmont resident to be their spokesperson!!

Practically no one in Longmont supported Comcast's position, as we noted yesterday - everyone campaigning for office supported reinstating local authority to provide broadband services. The newspapers supported the effort. In debates, the only people willing to defend Comcast's position were from out of town.

For just about everyone, this was a no-brainer: The City should be free to use assets it built long ago to expand economic development and broadband access. And yet, Comcast's $300,000 still got 39% to support letting City assets go unused while local businesses and residents are overpaying Comcast and CenturyLink for those services.

One of the most unique ways Longmont's elected leaders discussed this issue occurred during a City Council meeting. During that meeting, each official approached the podium and made a public comment about why they supported the 2A initiative. Unfortunately, we have not been able to locate video or audio, but the idea may inspire other communities as they seek to educate the community about the benefits of local, community ownership.

In other good news, nearby Boulder also embraced local self-reliance by narrowly voting to consider municipalization of the electrical grid. Xcel Energy spent close to a million dollars in a similar scare-campaign to Comcast in Longmont but Boulder voters decided to trust their local government more than a distant mega-corporations. Progress.