 To meet the energy demands of its region, this municipal utility finds ways to do more through innovative approaches. | Premier Business Partners: | | System 3, Inc.
| Rather than using a traditional solution to the old problem of meeting electric demand, the country’s sixth largest energy municipal utility is leading the industry by increasing its use and efficient distribution of renewable energy. For the past 20 years, SMUD (Sacramento Municipal Utility District) has met the growing energy needs of its region through innovations on the demand side and by including renewable energy in the resource mix on the supply side, but in 2001, the focus intensified with a board-led mandate.
“The mandate, which was the first in California, was to increase our renewable portfolio,” said Jim Shetler, assistant general manager of energy supply. “The goal the board set was 10% by 2006 and 20% by 2011.” Since then, the 2011 goal was increased to 23% by the board.
 Jim Shetler, Assistant GM of Energy Supply
“Our commercial customers want to demonstrate their commitment to the environment,” he said. “The challenge in reaching those goals, however, is finding the right technologies.”
Following instructions
California has specific definitions for green energy, including small hydro, solar, wind, biomass and biogas, and geothermal. Because of competition with other state entities, SMUD initially sent out RFPs to see the level of interest from developers. The utility’s other approach was looking at developmental opportunities, either with partners or alone.
“In 1998, we began working with a local county landfill,” Shetler said. “The county built the facility, and we’ve purchased the power coming from the methane gas from the landfill, which was expanded again in 2005.”
Roughly 15 years ago, the utility also bought several thousand acres of property to the west on the Sacramento River delta. SMUD built the property out to a little more than 100 megawatts of wind turbine capacity and added to that with 3,000 more acres of property. “Our hope is to add another 120 megawatts of wind capacity,” he said.
However, Sacramento’s geography does not make it an very viable location for the growing consumerism of renewables. The utility’s generating capacity includes a 5-megawatt solar photovoltaic facility, a 688-megawatt hydroelectric facility, and roughly 1,000 megawatts of natural gas combined cycle and co-generation facilities. However, the region’s current peak energy capacity need is 3,000 megawatts, and in the next 50 years, that number is expected to grow by 2,000 megawatts.
The demand on how we meet the energy need, coupled with the law in California that says we have to reduce CO2 emissions for the entire economy including the utility sector, presents a challenge,” Shetler said. “So how do you deal with and go forward with that?”
Looking forward
Rather than looking for more of the same as the answer, SMUD looked to efficiency. The utility gathered a diverse team of its employees, many of whom had not worked together before, to map processes, seek improvements, and increase efficiencies. On the distribution side, the company instituted an outage management system to manage real-time resources and provide real-time responses to outages. The organization also enhanced its Web site to allow customers to establish and change their services.
“We’ve digitized the maps of our distribution and transmission systems. We’re electronically designing into the future rather than using hard maps to do design,” Shetler said. “On the customer side, we’re improving our customer response technologies for our customer management and phone systems.”
One of the key elements to SMUD’s successful implementation of efficient thinking is that the utility leads by example. In the early ’90s, it built its customer service facility with low-energy lighting, individual heating and cooling vent controls, and the latest in building design technology focused on insulation. In 2006, the executive team took the green concept one step further by looking into LEED (Leadership in Energy and Environmental Design) certification. Because the facility was already energy efficient, many of the changes were related to processes, including reducing fresh water use, using green products for cleaning, and recycling lawn and tree trimmings.
After implementing the changes, SMUD’s customer service center received platinum certification from LEED. “We’re extremely proud of that,” Shetler said. “We were the first utility in the country to achieve that recognition.”
New and used
As SMUD launches its newest customer service and education initiatives in the upcoming year, it will increase spending on energy efficient programs and community education, as well as introduce real-time metering. Never far behind these innovations, however, will be the constant struggle to meet the energy needs of an ever-growing population by looking for new places capable of supplying renewable resources.
“We’ve approached our board about partnering with other Northern Californian municipal utilities to expand transmission access to new renewable locations, and we just re-licensed our hydroelectric facility, which includes a possible new pumped storage project to help us manage intermittent renewable resources,” Shetler said. “But it will always come back to balancing the demand and supply side of the energy equation. We want to make more efficient use of our resources while engaging our customers in meeting the energy challenge for Sacramento.”
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