CU GM: Solar energy, broadband divestiture in pipeline

Moving toward what he calls an interesting future, City Utilities of Springfield General Manager Scott Miller says the community-owned entity is working to add additional solar capacity, and sell control of a lesser known unit of its portfolio, broadband service.

On the broadband side, Miller said CU is working to sell off its data center known as SpringNet Underground.

"We've hired a firm to help us try to market and sell that data center," said Miller, the featured guest this morning at Hilton Garden Inn for Springfield Business Journal's last 12 People You Need to Know breakfast interview of 2013. "It'll put it in private hands, which I think is probably the appropriate place for it to be.

"It has the potential of either bringing local money into the community or outside money into the community for expansion and maybe jobs. I think we'll have an opportunity to sell our data center this year."

Declining to disclose how many potential buyers CU is courting, Miller said the decision to sell the facility at Springfield Underground was needed due to the rising costs of providing broadband services to commercial and industrial clients.

"The problem with it is we have a business that is expanding, and we don't have the capital to go into it," Miller said. "The next expansion's going to be somewhere north of $16 million, and the next expansion after that is going to be $60 million. We just don't have the money for that."

Solar push
Miller foresees an increased push toward renewable energy sources, though he admits these projects probably wouldn't happen without government subsidies.

Now, 8 to 11 percent of Springfield's energy is delivered from renewable sources, Miller said. When he started with CU in 2002, that figure was about 5 percent.

CU is partnering with Chapel Hill, N.C.-based Strata Solar to build a 5-megawatt solar farm on roughly 30 acres east of the city. In the deal, CU is donating the land and will purchase the generated electricity, and Strata Solar also gets about 1.8 cents per generated kilowatt as part of a government incentives program for renewable energy.

Miller said CU is looking into the possibility of making the farm a community solar project, where residents can buy in, guarantying they would be serviced with solar power when the farm goes live.

Leaving a legacy
When Miller looks back at his career as general manager of CU, he hopes his tenure is marked by systemwide improvements and increased stakeholder accountability.

Now, two and a half years into his role heading the $500 million per year community-owned provider of electricity, natural gas, water, broadband and transit services, Miller says he is first accountable to the company's customers, who rely on and pay for CU's services.

"If you think about our business, every day, every minute, you depend on electricity, water, natural gas. That's what you guys all need for your businesses to be successful," Miller said. "For us, if we have one person who messes up, if we have a piece of equipment that fails, it can mess up your day. That's what we deal with on a day-in, day-out basis."

One such misstep occurred in October, when an equipment malfunction at John Twitty Energy Center caused a cloud of ash to cover a portion of the city. CU provided some 900 free car washes to soften the blow.

From what Miller referred to as a crisis, he hopes CU can build an opportunity for increased customer service.

"We stationed people at the car washes, and we apologized to them for the inconvenience," he said. "I hope that we have 900 customers who turned around and said, 'Hey, they took care of us,' as opposed to, 'Hey, this was a bad thing.'"

Water concerns
Getting the water needed for the car washes - and other everyday uses - to Springfield is a constantly flowing business component of City Utilities.

After a summer 2012 drought nearly kicked in CU’s Emergency Water Conservation Plan, Miller says the area is far from out of the woods.

"It's not behind us," he said. "We've been in a wet period since the late 1970s. Statistically, if we've been wet for that long, we're going to have a long dry period coming up."

Water usage also has nearly doubled, with peak usage now at 59 million gallons a day, compared to a peak of 35 million gallons a day in the late '70s. But, Miller said, the 2012 peak didn't reach 50 million gallons a day, something he hopes residents will remember to do again even in ideal conditions.

"Our job is to try to figure how to get all of you to use less water. If you think about it, how many of you in your business go out and tell your customer to use less of your product?" Miller said. "Our real dynamic problem is that as we're trying to keep our costs low and we're trying to get you to use less product, and we still have a half-a-billion-dollar company that we have to make sure that we balance."