When Manny and Roz de Lizarriturri retired from their advertising jobs near Philadelphia, they wanted to explore the United States in their RV. So the married couple of 33 years got out a map.

“We wanted a more central location. We were looking for a more affordable place to live, and we looked at all these AARP ‘Best 10′ lists, and Pueblo [Colorado] figured in a lot of them,” says Manny de Lizarriturri.

About a two-hour drive south of Denver, Pueblo is a steel town of 108,000. It was once known as the “Steel City” of the West but fell on hard times when industry, and jobs, shifted overseas. Today, homes are still affordable in Pueblo — but powering them is not.

Roz de Lizarriturri says, “The electric bills here were about 30 to 40 percent higher than in the Philadelphia area.” In Pueblo, the de Lizarriturris were paying about $180 per month, on average, to power a 2,500-square-foot home.

“And we were living in one room or two rooms because we couldn’t afford to either heat the whole house or have air conditioning in the whole house,” says Roz de Lizarriturri.

Their utility, Black Hills Energy, based in South Dakota, had begun charging its Pueblo customers more to pay for a new natural gas power plant east of town. But Pueblo is not a wealthy community — the average household income is $36,000 — and many customers couldn’t afford the higher bills. Many had their power cut off and couldn’t pay their past bills and a deposit on future charges to have it restored.

Other cities have created municipal-controlled utilities, and more are exploring the idea.

But is it fair for utilities to charge solar customers higher rates?

“Fair or unfair is a bit of a tricky question,” says economist Steve Cicala, an energy regulations specialist at the University of Chicago.

For one thing, Cicala says, utility grids really do have fixed costs that need to be shared: “And the people who were putting solar panels on their rooftops were paying less of that.”

Also, a key service utilities provide is reliability, something that’s important for everyone, and operating a city-owned utility would be extremely challenging.

“For all of the problems that they feel that they’re experiencing with the utility, there will be a menu of different problems that they’ll experience when they’re on their own as a municipal utility,” says Cicala.

Continue reading at Public Radio International…

Read More

Areas of Focus: Energy Markets
Energy Markets
Well-functioning markets are essential for providing access to reliable, affordable energy. EPIC research is uncovering the policies, prices and information needed to help energy markets work efficiently.
Electric Power
Electric Power
As the electric power system faces new pressures and opportunities, EPIC research is working to identify the mix of policies needed to accelerate the global transition to clean, reliable, affordable...
Renewable Energy
Renewable Energy
Lower technology costs and supportive public policies are driving an increase in renewable energy in markets around the world. EPIC research is assessing the costs, benefits, and efficiency of policies...