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Vol. 25, No. 2, April 2006

Resort area utilities grapple with price of popularity

The mountains, deserts and beaches in Western's territory inspire people with their great beauty. Frequently, what people are inspired to do is build vacation homes that are occupied only a few weeks or months a year, posing challenges to the towns and utilities that serve them.

One solution to the difficulties large homes with part-time occupants create for the usually small towns is to limit the size of home that can be built in the area. That is exactly what officials are considering in Pitkin County, Colo., where the resort towns Aspen and Snowmass are located.

Houses create demand for services

Capping the size of houses at 15,000 square feet will help to control growth, said County Commissioner Mike Owsley. The county currently limits homes to a maximum of 5,750 square feet, but owners can get around the rule by purchasing transferable development rights. Owsley noted that Pitkin County gets one or two requests each year for homes exceeding the proposed limit.

"Houses that size have an impact on county infrastructure that is far greater than just the house alone," he said. "Setting a limit will give the county the chance to adjust for the increased traffic and catch up to the need for affordable housing."

Each large, luxury home, Owsley explained, increases the demand for service workers. The city and county have an inventory of approximately 3,000 affordable apartments, but even those won't be enough, he said.

Employees should be able to live close to their jobs, he added, to minimize the impact of driving on county roads and the environment. "If people have to drive a long way to get to work, it clogs Highway 82 directly into Aspen."

Uneven load

Phil Overeynder, public works director for the city of Aspen, understands the need for controlling growth. "Most of the vacation homes are outside town so they get electric service from Holy Cross [Energy], but we still have to extend water service to them," he said.

Aspen Electric Utility serves 2,600 meters within the city limits, while Holy Cross provides power for the rest of Pitkin County. Many of Aspen 's customers are commercial, and, "About 70 percent of our base is less than full-time use," said Overeynder. "I can tell when everyone is in town because the load goes way up. That's in the winter—especially Christmas week—and around the Fourth of July."

The demand for vacation properties in Aspen has led to tearing down permanent residences with good load factors, and replacing them with vacation homes with a poor load factor. "We end up spinning power for non-occupants—people who are only going to want power on peak," Overeynder pointed out. "How you charge for that is an issue. You don't want one user group subsidizing another."

The municipal utility's answer is an inverted block rate. Customers using up to 700 kWh pay the lowest rate. The average user—between 700 and 2,000 kWh—pays a slightly higher rate, and those with more than 2,000 kWh pay the most. "Large residences use much more power than smaller ones, even when no one is home," the public works director added.

More customers, more stability

The majority of the luxury vacation homes in Pitkin County get power from Holy Cross Energy, which serves about 43,000 meters. "Our member-owners are mostly residential, with some fringe businesses," said Member Services Supervisor Stephen Casey.

Part-time residents do not have a significant effect on Holy Cross's larger, more stable load. "You build infrastructure with full-time users in mind," said Casey, "so any time the system is being under used, it's less than efficient. It's a problem that all utilities have to deal with to some extent."

While Holy Cross does not have a special rate structure, it does have a minimum monthly service charge. "The policy is to discourage homeowners from stopping and starting service in part-time residences," said Casey. "Even if they are not occupying a house for a few months, they still need the electrical connection when they return.

Casey added that large vacation homes do not automatically represent poor load factors. "It is possible for one large home to use electricity very efficiently for four months, while half a dozen small homes could be inefficient all year," he noted. "Rates can be designed to encourage efficiency among all users, and that can be valuable for mitigating the environmental impact of generating electricity."

Commitment to environment

Both utilities are strongly committed to balancing customer demand with environmental protection. Pitkin County's luxury tax on energy requires homeowners who exceed Aspen's strict energy "budget" for new buildings either to install a renewable energy system or to pay a mitigation fee. The fees fund energy efficiency projects and renewable energy development.

Also, the new 3,000-unit affordable housing complex is a LEED project that the city would like to power with wind energy. Estimating the size of the purchase hasn't been easy, said Overeynder, because, "The average apartment of that size uses 700 kWh monthly, but the project managers think these units will only use 300 to 400 kWh."

Holy Cross's members are enthusiastic supporters of renewable energy. The utility's voluntary offering consistently appears on the National Renewable Energy Laboratory's annual ranking of top 10 utility green power programs. Customers can become Wind Power Pioneers or choose electricity generated by member-owned, small-scale hydro facilities or solar installations.

The co-op developed a voluntary carbon reduction strategy, "With Efficiency, Conservation and Renewable Energy, We Can Make a World of Difference," or We Care, to reduce emissions associated with electricity use. The strategy includes increased renewable energy use, incentives for renewable development within its service territory, consumer rebates for energy efficiency and conservation activities and consumer education.

The tug of war between development and preservation is a fact of life in resort areas, but residents generally support measures like housing size caps and renewable energy programs, said Owsley. "People like to know that we are trying to protect what they moved here to enjoy in the first place."

 

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