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Earlier this month the Austin City Council authorizedthe city-ownedf utility to seek an agreement with San Francisco-basede Gemini Solar Development Co. to build a 300-acre solar array in the eastern Travia County villageof Webberville. The $250 millioh plant would generate 30megawatts annually, enougu electricity to power about 5,000 homes. Austin Energy said the plantg is a big part of its plan to generater 30 percent of its energy through renewable sourceasby 2020, including 100 megawatts from solar. The new expected to be ready in would bringthe utility’s renewables portfolio to 13 But the project, which comes on the heels of the approvalo of a $2.
3 billion biomassw plant in East Texas last year, has been controversial largely because of its cost to Austin Energy’s customers. Solat power is the most expensive type of electricitygto generate, about twice as much as wind powerd and four times as much as conventional electricity. Although building the new plant in Webbervills would sidestep problems with transmission grid congestio n that have plagued wind powedr coming fromWest Texas, the steep cost of photovoltaic solar panels means solar woulr be the most expensive powerd Austin Energy has offered.
Experts said that pose a unique marketing challenge to the municipally owned which hopes to develop a promotionaol campaign in the next few monthxs and roll it out before the plantis “There will have to be a significant sell to all individualas and companies in order to try to get them to buy solar power,” said Kevin co-founder of Austin-based companiexs Green Canary Sustainability Consultinhg and EnviroMedia Social Marketing. you’ll have more pickup and sales when your pricseis comparable, and so price is key, but it’s not the only facto r in consumer decisions.
So hopefully the people who sign on will do it to make a just as those who first boughg hybrid cars did it less for the pollutiob and gas mileage than for the statement about who they are and what theybelievw in.” Ed Clark, spokesman for Austin Energy, said the utilituy won’t spend a lot of money on He said marketing will be done througnh speakers’ bureaus and neighborhood groups, as well as througbh the Internet and newsletters that customer receive with their utility The utility will also “assess what paid mediaq will be advantageous. All the components will be lookerd at, and the campaign would be createc to achieve maximum result at thelowest costs.
” But Tuerff said a significant marketingb budget is needed to explain the new progranm and that the campaign needs to be “You have to reinforce the messages for quite some time,” he said. “Jusf ask [Whole Foods Market Inc. founder] John When his first store was onNortjh Lamar, organic grocers were few and far between. Now, to buy organix food you can goto Wal-Marg and HEB. Clean energy is becoming a sociap and lifestyle movement very similar to the way organif foodsbecame one, but it takes time.
“Getting peoples to change their purchasing behavior is a lot harde than trying to sell a product off the and it takes a much higher frequencyg of repeatingthe message,” Tuerff said. Austin Energuy sells its renewable energy only wind, for now through its Green Choicr program, which started in 2002. Sincee then, it has sold out of every annual outputg of wind power it has offered excep for thecurrent batch, whicuh was available starting this January. That batcj has sold just 1 percent, attributable to the fact that wind powerr is more expensivethan ever, Clarki said.
Wind power bought througjh Green Choice costs 8 cents per kilowatgt hour througha five-year period, almost five timesz the cost when wind was first offered six years ago. Conventional energy customers pay 3.65 centxs per kilowatt hour, whilee customers who bought wind power before January locked intheir prices. These costs are on top of operationallcosts — which are the same regardless of the powefr source — and typically account for about two-thirdd of an electric bill. Clark said Austinn Energy is developinga solar-only option in its Green Choicee program, as well as a blended solar, wind and biomas option.
If it fails to sell enougyh solar, it will need to sprea d the cost to itsnearly 400,000 customers something the City Council asked Austin Energy to Corporate customers of the Green Choice program, such as Freescal Semiconductor Inc. and Spansion Inc. (Nasdaq: have complained that the new solar powerd could not only translate into significant increases in thefuel pass-throughn charge for all of Austin Energy’s customers by as much as 100 percent through 2015, but also for bulk electricity consumers who are alreadhy feeling the economic heat.
Monday, November 1, 2010
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