Green Mountain Power Goes Green, Saves Green

Photo: Green Mountain Power
Rutland, Vt., site of Green Mountain Power's pilot city project where 6 megawatts of solar power will be installed by 2017.

At a time when some forecasts for the future of electrical utilities see gloom—volatile fossil fuel prices hiking rates and killing profits while customers wean themselves from the grid in favor of renewables, distributed storage, and smart micro grids—it’s no surprise that some of the 3300 electric utilities in the United States have dug in their heels. Florida’s top electrical utilities, for instance, have reportedly strongly resisted the rise of solar power in the sun-drenched state.

Yet a few utilities are actively bucking the industry trend of rising rates and resistance to clean energy. In 2014 alone, for instance, Vermont’s top electric provider, Green Mountain Power (GMP), has announced a 2.46-percent rate cut while also receiving the advocacy group Vote Solar’s 2014 Solar Champion award—the only utility to be so honored.

GMP has made Rutland, Vt., its pilot city [PDF] for promoting solar power, promising at least 6 megawatts of installed solar power by 2017, starting with a single 150-kilowatt farm. It’s also developed a pilot “eHome” in the same city, combining solar with smart home metering and high-efficiency installments like air-source heat pumps and a monitor app for their mobile phone. Statewide, GMP has pushed for increased net-metering, a scheme under which solar-powered homes sell excess electricity back to the grid. And the utility has also opened the state’s largest wind farm, with 21 turbines generating 63 megawatts capacity, alongside its 32 old-school hydropower generators.

GMP President and CEO Mary Powell says both the utility’s rate-cutting efficiency and its embrace of clean energy stem from a culture of innovation she’s overseen since taking taking the helm of the company in 2008.

“I’m talking to you from a standup desk in a five-by-five-foot area right in the open, right by where the linemen come in and go out on a typical day,” she says. “There are actually no private offices in the building. Every single room is in glass, so what you’re doing is always visible to others. It’s a very flat organization. It’s very open and transparent.”

Powell contrasts what she calls GMP’s “fast, fun and friendly” present-day culture with the organization she began working for in 1998. When she interviewed for a senior vice president position—an offer she says she turned down three times before she ultimately took the job—GMP’s headquarters in Colchester, Vt., looked more like a classic office building designed around classical corporate hierarchy.

“You walked up these domed staircases,” she recalls. “You had to get through two private secretaries to get into the CEO’s office. And it had to be at least 500 or 600 square feet, with a private bathroom, private conference room...completely protected from customers and employees—the most important populations to be connecting with.”

Also emblematic of the old GMP, she says, was the 15 percent rate hike the utility’s officers requested from state regulators soon after her arrival. The regulators ultimately agreed to give GMP a rate hike, she says, though the raise was somewhere between two and three percent.

The organizational crisis this partial denial presented, Powell says, provided incentive to increase the utility’s operational efficiency. She says she wound up cutting operating costs by $8 million. These measures, she says, in turn enabled her to start introducing a more customer-oriented corporate culture—one she learned working in finance and banking.

Ultimately, when she was offered and accepted the CEO position in 2008, she began introducing changes such as keeping the company’s officers, herself included, in regular contact with customers. (She estimates she meets with some 50 GMP customers per year.)

By 2010, she says, she was hearing in her meetings that GMP’s customers really just wanted their electricity green and free of charge.

“I still don’t see any path towards [free],” she jokes. But, she says, she still asked her team to think hard about ways to provide customers with what they want—and, she says, “how to leverage smaller-scale, intermittent resources, instead of being frightened by them.”

Powell says one of her goals is to use the Rutland solar city plan to prove that both solar and distributed energy works for all the utility’s customers, not just the stereotypical upper-middle-class greens often mocked by clean energy’s critics.

“We were really deliberate about targeting a working class family in Vermont, and we’re focused on a working class neighborhood,” she says of the utility’s pilot eHome. “That’s really important to us, to demonstrate that all this cool new stuff and new sources of energy generation aren’t just for certain folks who can afford it. We’ve offered financing and creative partnerships, showing how it can add tremendous socio-economic value.”

Yet, she says, none of the above matters if GMP can’t keep electricity costs low and power outages down to a minimum.

“What I love about innovation is just when you think you’re there, you’re not,” she says. “At the same time we’re figuring out these newer, cooler ways to meet customers’ needs and bring them greater comfort, convenience and lower cost, we’ve also got to maintain this one-and-a-half billion dollar infrastructure that we oversee and provide…so we can continue to maintain that strong, important traditional relationship while we’re also leaning in and embracing every level of disruption.”

 

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