Canary sings back
(Editor’s note: This opinion was originally sent as a letter by Phil Overeynder, Aspen’s utility director, to Sterling Burnett of the National Center for Policy Analysis in Dallas, and Patrick Michaels of the Cato Institute in Washington, D.C., both critics of the city’s Canary Initiative to reduce greenhouse gases.)I appreciate that you both took the time to look at the city of Aspen’s “Canary Initiative” from the perspective that solutions to environmental problems need a market-based component. Unfortunately, I believe that common misperception regarding economic realities prevalent in the Aspen area may be clouding your judgment with regard to whether our program has such a market based approach and has any relevance outside of the Roaring Fork Valley. You suggest that Aspen would be better off to accept global warming and deal with its effects than attempt to steer a course towards a sustainable future. You also suggest that Aspen may be fine with purchasing inefficient power at higher prices, but that such an approach won’t sell elsewhere.The expenditures in Aspen’s “multi-million dollar Canary Initiative” are primarily for energy supplies to the community, monies that must be spent on some form of electrical power to meet our power requirements. Every municipal utility has the choice of how to best meet those needs. Aspen is choosing to invest in measures that have been demonstrated to be economically sound, some of which have been employed locally for over a century. Aspen’s proven business model for its electric utility has kept customer rates in the lowest quartile of all utilities operating in Colorado, while providing 57 percent of its power through renewable sources. (Ask anyone living or managing a business in Aspen what else they can purchase here for less than if they were in Denver.) Over the last century Aspen has invested in renewable hydroelectric power and more recently, in wind energy. Our rates are now low in relation to those of other municipalities, not because we have always selected the lowest short-term price of power available, but because we have favored capital intensive energy sources to avoid long-term inflation in areas such as fuel prices. Once the debt has been paid, our customers will continue to enjoy the benefit of low cost power with facilities that have a longer useful life than a simple amortization schedule would imply. We have enjoyed rate stability in the face of rapidly fluctuating fuel prices, while other utilities have had to pass on the increased cost of natural gas and other fuels to their customers.I’m glad you both mentioned the Kyoto Protocol in your critique of Aspen’s “Canary Initiative.” Aspen has had its own connection with Kyoto that dates back to the 1880s, relating to renewable energy development. Aspen served as the inspiration for Japan’s first hydroelectric power plant. You can still view a near replica of an early Aspen hydroelectric plant in Kyoto. Most school age children in Japan can cite the virtues of using hydroelectric power, with Aspen being credited as the source of this invention. It’s hard to argue with the power of a good idea that catches on elsewhere. Aspen remains optimistic that the power of its ideas, bolstered by sound economic principles, can shift trends in producing green house gases and aid in reducing the rate of climate change.While you may misjudge Aspen’s willingness to ignore economic reality, I believe you have both made a point to consider, regarding the potential for success of Aspen’s role in the Canary Initiative: those that we need to move to action are motivated by economics. While I disagree with your assessment of the prospects for success, part of our job is to convince those in a decision making capacity to move away from short term economic gain in favor of a longer term view of resource economics.
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