Reinventing LUS in the Age of Energy Transformation

It is time to reinvent Lafayette Utilities System as an energy provider.

The energy world is undergoing deep and profound transformation yet LUS ignored community input and locked itself into a new 30-year deal on an obsolete (some argue immoral) coal-fired generating plant in Boyce, LA. The decision flew in the face of objective evidence that burning coal to generate electric power was a doomed technology that would ultimately produce power that was more expensive than that generated by other sources.

LUS was on the right path when it engaged and listened to its citizen/owners in the fiber fight.
LUS was on the right path when it engaged and listened to its citizen/owners in the fiber fight.

For more than 30 years, LUS was a part-owner with CLECO of the plant in Boyce that burns coal carried to Louisiana by trains. I can recall when CLECO was giving presentations about the plant while I was living and reporting in Eunice in the early 1980s. In the run up to the renewal of its deal with CLECO on the plant, LUS’ leaders provided a history of their operation with clear 30-year life cycles of plants. Instead of looking forward, LUS ignored the ample economic analysis available at the time and renewed its commitment to the most polluting fuel source as the basis to power Lafayette in the first half of the 21st Century.

The recent solar tax flap shows more evidence that LUS has lost its way. Instead of looking at the broader impact of its decisions on the community, on energy LUS is behaving like the worst of the investor-owned utilities whose shunning of Lafayette in the late 19th Century made LUS a necessity.

Prior to moving back to Lafayette in 1999, I had pretty much made myself a nuisance to Governor Mike Foster and his Vision 2020 team, saying that long-haul fiber optic lines then being strung across the state opened Louisiana to opportunities that fell outside the traditional lines of industry that were dominant here. It was three years after the Telecommunications Act of 1996 had unleashed waves of innovation in telecommunications, tearing down AT&T as the dominant network (a position to which it has since reclaimed, although with somewhat reduced clout). The law was not without its flaws, but it opened the telecommunications industry to investments andnew technologies — particularly packet-based networks that that destroyed the direct switch networks that were the chokeholds of the incumbent carriers — that have since transformed communications.

Shortly after arriving back in Lafayette, I was invited to join a citizens advisory committee that had been convened by LUS, which was replacing its wireless electrical network monitoring system with a series of fiber optic loops. The function of the committee was to look at how other communities with municipally owned utilities had deployed fiber and brought the benefits of that infrastructure out beyond the walls of the respective utility systems.

We looked at a range of business models that had been used across those cities, many of whom were customers of an engineering firm that was consulting with LUS at the time, R.W. Beck.

It was an interesting exercise. Ultimately, the committee opted for a conservative approach that had LUS lease access to the fiber loops but left its business partners with the challenge of providing the ‘last mile’ connection from the loops to their customers who were seeking more robust and affordable bandwidth than BellSouth (remember them?) and/or Cox could provide.

The fiber to the home initiative that LUS introduced three years later was a direct outgrowth of the work of that committee.

Haywood "Woody" Martin, Delta Chapter of the Sierra Club. LUS owner/customer.
Haywood “Woody” Martin, Delta Chapter of the Sierra Club. LUS owner/customer.

If it is going to escape the kind of entrenched thinking displayed by the boneheaded moves of reinvesting in coal-fired generation and the recent solar tax, LUS needs to convene a new citizens advisory committee and charge it with examining the the dramatic changes taking place in energy today. Elon Musk just unveiled new solar rooftop shingles that will remove the boxy panels from rooftops and enable homes (even in places like River Ranch where covenants ban solar panels) to generate more of their power on their own. Some utilities are using power generated by electric cars as assets to help during peak demand times. Utilities could become back up systems.

LUS appears oblivious to the changes sweeping the energy industry. Part of it seems connected to the cash cow role that LUS has come to play in Lafayette Consolidated Government. Another part of it seems tied to the bond bankers that consult with LUS and who don’t appreciate the full implications of the utility’s potential as a catalyst for the community.

LUS was founded as a community response to Lafayette’s desire to grow and prosper at the pace it decided, not others. That is why the LUS Fiber project won approval and has been so successful. It was the natural outgrowth of LUS’ founding experience. We decided that we wanted massively available bandwidth. Cox and BellSouth said no, so we did it ourselves.

LUS’s commitment to coal, it’s attempt to tax solar power and the fact that it does not have any kind of energy efficiency program in place are clear indicators that on energy it has lost its way. The telecommunications revolution was and remains about decentralizing communications power. We now have more communications and computing power in our hands than some corporations had decades ago.

The revolution sweeping energy now offers the promise of energy decentralization with less reliance on grids, more energy independence for homes and small businesses. This clashes with LUS’s business model and with its role as the cash cow for Lafayette Consolidated Government.

LUS was built to serve the people of Lafayette. It needs to refocus on that core mission. In the age of energy transformation, that will mean reinventing itself and rethinking its role in the community.

The key can be found in the LUS Fiber effort. Don’t think like an incumbent. Think like an innovator. If they draw on the creativity and imagination of their citizen/customers, LUS can do that again, just like they did on bandwidth and fiber.

Woody Martin, leader of the Delta Chapter Sierra Club, and I talk about the solar tax fiasco and the need to LUS to open up to its customers. It’s all in the podcast.

One thought on “Reinventing LUS in the Age of Energy Transformation

  1. To be a real “tax” on solar power the charges would have been listed under “Sec. 94-117, (c) Monthly rate. (4) Tax additions:” Just as “Schedule X-1” provides for the calculation of the “In-Lieu-of-Tax” payment to the City of Lafayette general fund as their “Tax addition” to the utility rates.

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