Rebuilding Place in the Urban Space

"A community’s physical form, rather than its land uses, is its most intrinsic and enduring characteristic." [Katz, EPA] This blog focuses on place and placemaking and all that makes it work--historic preservation, urban design, transportation, asset-based community development, arts & cultural development, commercial district revitalization, tourism & destination development, and quality of life advocacy--along with doses of civic engagement and good governance watchdogging.

Tuesday, November 08, 2011

More on utilities owned by local governments (cities and counties)

In the face of many power outages and maintenance failures on the part of investor-owned Pepco, Montgomery County Councilman Roger Berliner's proposed that the County take over electric power distribution within the county to better focus resources on maintenance.

This proposal has been widely derided. See the past blog entry, "Press piling on Montgomery County's utility dreams."

Interestingly, a Reuters opinion piece published in the New York Times, "The Troubling Connecticut Power Failure," points out that while investor-owned Connecticut Light & Power has hundreds of thousands of customers without power, still, after unexpected early snowstorms, the municipally-owned utility in Norwich, Connecticut has fewer than 500 of its 22,000 customers without power.

From the article:

Yet according to regulatory filings, Connecticut Light and Power cut its maintenance spending by 26 percent, from $130 million in 2008 to $96.5 million last year. Put simply, that seems to suggest that one in every four trees that could have been trimmed was left untouched, though the company says the maintenance line was depressed by a deferral of expenses for accounting purposes. ...

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.

It helps that the Norwich utilities are not slaves to the profit motive — though they hand 10 percent of gross revenue to the city. 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's an example that shows why having locally-owned utilities are worth objective consideration rather than knee-jerk condemnation.

Not that it would be easy to create. Especially in this political climate.

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