The City of Boulder, Colorado bailed out of the Smart Grid City proceeding before the Colorado Public Service Commission asking to withdraw its filed testimony.  The City said its City Council was divided on the project and just wanted it to go away.

That’s the widely held sentiment on this failed smart grid pilot project that saw its cost balloon out of control and the politicians seeking good press from praising the project are now trying desperately to get it off their shoes.

Last December, the Colorado Public Service Commission ordered a prudency review of the project and told Xcel Energy to justify the cost increases or risk being stuck with them.  Technically the Commission ordered a hearing on whether to grant a Certificate of public Convenience and Necessity which would be the basis for granting regulatory treatment and recovery of the Smart Grid City costs.  It is that prudence review that is now underway.

By its withdrawal action Boulder is joining the chorus in suggesting to the CPSC that it should stick Xcel with the bill.  But Governor Bill Ritter said the project was a first in the nation pilot and the company took a risk in doing it in the first place that should not be punished because it did not go as planned.  The ratepayer advocate in the proceedings, The Office of Consumer Counsel proposed that Xcel be permitted to recover $27.9 million instead of the current $45 million since that was the company’s 2009 estimate of the project cost.

Everyone expects the CPSC to permit recovery of some of the costs so the Consumer counsel number may be a trial balloon on a compromise figure that balances the interests of recovering reasonable costs for tying new and difficult things like smart grid while not rewarding the utility for letting the project get out of control in cost.

Hoping to get out of this mess soon Xcel CEO David Eves said the company would not be rolling out smart grid city across the rest of the service territory—everyone breathed a sigh of relief.

So what?

So we’re learning that introducing a new order of things like smart grid is complex and costly and takes more than installing smart meters.

We’re learning that customers don’t understand why the utility is doing smart grid and when their utility bills go up they are quick to blame smart grid tarnishing the enthusiasm for new technology before it even is installed.

And we are learning over again for the umpteenth time that when a project gets in trouble many of the politicians and regulators who pressured the utility to do the project in the first place moonwalked when it went south.  So kudos to Governor Ritter and the Office of Consumer Counsel for not playing that game.

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