a_journey_to_sustainability.public_power.march-april.2009

Journey toSustainability

March-April 2009Volume 67, Number 2

10 QuestionsFrances Beinecke

Fort Collins Utilities, a municipallyowned, multi-service provider of electric,water, waste water and storm water serv-ices, has taken decisive steps to transformitself into a “Utility for the 21st Century,”guided by a vision of enterprise-wide sus-tainability. Passing a major milestone onwhat is certain to be a long journey, theutility has completed a detailed sustain-ability plan that is being rolled out in 2009.The plan, which has a decided focus on asubstantive and rigorous approach, alignswell with the inspired ambitions of thecity’s leadership, as well as the prevailingculture of the community. Fort Collins is acollege town of 137,000 people, locatedalong the front range of the Rockies, some60 miles north of Denver. It has an envi-ronmental ethic befitting the naturalbeauty of its surroundings, and a politicaland business environment that most char-acterize as progressive. The city leadersenvision the greater Fort Collins commu-nity becoming a model of sustainableliving.

The challenges of the transformation

are formidable. “I was pretty disappointedby the lack of vision I saw when I came onboard a few years back,” said City Man-ager Darin Atteberry, executive sponsor ofthe Utility for the 21st Century sustainabil-ity plan. “Traditionally, [the utility] haddone a pretty good job in terms of main-taining our assets and providing reliableservice at very low cost. That’s good,something to build on, but it is only part ofwhat will be needed in a resource-con-strained environment where the drivers,from reducing greenhouse gases to morerenewables, are growing stronger.”

To meet this challenge the city selectedBrian Janonis to lead Fort Collins Utilitiesinto the future. “Brian’s a visionary whohas this notion of sustainability built intohis DNA,” Atteberry said. “My job hasbeen to encourage Brian and his team tothink big, be pragmatic, and do somethingreally spectacular for Fort Collins Utilitiesand the Fort Collins community. And tome, spectacular means putting the Utilitiesat the leading edge of sustainability. Addto this the fact that the mayor, City Coun-

cil and community believe in and supportthis direction.”

Pragmatism is a key component of Atte-berry’s management style, which combinesthe stretch of visionary ideas with thegrounded rigor of disciplined accounting.In recent years, he has moved Fort Collinsfrom what he calls a “trust-us” to a “prove-it” type of government. “We now budgetfor outcomes. Every city service has to gothrough the equivalent of a competitiveprocess, documenting the outcomes theyare trying to accomplish over the nextbudget cycle. When these are funded, wehold them accountable.”

The process emerged from financial ne-cessity, said Atteberry. “For decades, weenjoyed 8 to 10 percent per year revenuegrowth. Then we had a combination of thetech-industry bust and a lot of regional re-tail competition. Now we are in the 0 to 3percent growth range, while the internalservice cost curve still wants to follow theold revenue curve. Living in an era of lim-ited resources requires us to be betterstewards of all our resources – human, fi-

16 March-April 2009 Public Power

BY LYNN L. ADAMS

A Journey toSustainability

Fort Collins remakes its culture to become a model

sustainable community.

nancial and natural.”The impetus for

the Utility for the21st Century projectgrew out of thisneed for steward-ship and thedisconnect betweencustomer expecta-tions and limitedresources, said Jano-nis. In late 2006,Fort Collins Utilities hired R.W. Beck, Inc.to conduct an in-depth survey of its resi-dential and commercial customers.“Among other things, this research de-fined a ‘green gap,’” he said. “Ourcustomers thought we were doing morearound sustainability issues than we actu-ally were. And they expected us to bedoing even more. Our resources were lim-ited, our costs were going up, we werefacing new opposition to the developmentof our water supplies, and growing criti-cism of our coal-based electric generation.In short order, we had to turn from beinga traditional developer of natural resourcesto one of being a true resource steward.”

To develop a utility plan commensuratewith the changing times, Brian Janonishand-picked a Core Sustainability Team –comprised of 20 employees, managers andsupervisors – to work with senior manage-ment, an Advisory Panel of externalstakeholders, and a team of strategy andtechnical consultants from R.W. Beck. Theteam was responsible for moving sustain-ability from the realm of good intentionsto a purposeful and well-structured plan ofaction to guide Fort Collins Utilities in thecoming decades.

The Core Sustainability Team began bycrafting a purpose statement to guide itsdeliberations and work processes. Thestatement calls for, “Inspiring communityleadership through reducing environmentalimpact while benefiting customers, theeconomy and society.” Imbedded in thepurpose statement are three critical com-mitments: to pursue “triple bottom line”thinking, to ensure an outward orientationto the community the utilities serve, and toprovide an organizational model of sustain-ability designed to inspire the community.

The concept of consideringtriple bottom line impacts isused increasingly in sustainabil-ity strategy development andrefers to integrating economic,

environmental and social considerations.The development process of the plan

proceeded in four distinct stages. First,the team established a baseline audit us-ing recognized guidelines forsustainability reporting. Second, it formeda clear strategy that involved identifyingfour key issues, along with supportingstrategies and key performance indicatorsto measure progress. Third, it used a pro-prietary optimization model to run

Fort Collins Utilities Steps to Become a‘Utility for the 21st Century’

• Conducted analysis and market research that validated the need for an en-hanced focus on sustainability.

• Aligned with city direction; city manager and utilities executive director com-mitted to direction; selected initiative champion.

• Developed a Core Sustainability Team of employees, supervisors, senior man-agement, and technical/strategy consultants to develop an integrated actionplan.

• Assembled an Advisory Panel of external stakeholders, engaged to provide in-put on the sustainability direction as developed and to connect with thecommunity.

• Crafted a sustainability purpose statement to frame direction, guide delibera-tions and work processes; incorporated a commitment to the triple bottom lineof economic, environmental and social considerations

• Conducted a comprehensive baseline audit of the four utility services, adminis-trative, financial, customer and other functions for ongoing sustainabilityreporting and tracking progress to plan.

• Developed a plan to accomplish goals associated with four key issues —orga-nizational culture, external stakeholder engagement, triple bottom linebusiness practices and work force empowerment — and identified key per-formance indicators to measure progress.

• Analyzed various sustainability programs, and utilized R.W. Beck OptimitySM

(customized optimization model) to identify the most cost-effective portfolio tomeet established goals, such as greenhouse gas reductions, renewable energygoals and rates impacts.

• Developed and modeled various scenarios – aggressive, straight line and con-servative – that would meet 2020 targets with associated cost and ratesimpacts.

• Published a comprehensive plan and report, including a detailed implementa-tion plan to ensure accountability and progress to plan. Established variousmethods to support implementation; launched key initiatives.

• Filed sustainability report with the Global Reporting Initiative, the most widelyused standard framework for sustainability reporting. Fort Collins Utilities be-came the first municipal utility to file such a report.

‘Our customers thought

we were doing more

around sustainability

issues than we actually

were,” said Utilities

Executive Director Brian

Janonis. Photos by Tim

O’Hara.

www.APPAnet.org March-April 2009 17


scenarios and identify the most cost effec-tive programs to resolve the issuesidentified. And finally, it built a detailedimplementation plan to ensure continuousprogress and accountability, an approachvery much in line with Atteberry’s disci-plined requirements of “budgeting foroutcomes.” The sustainability team com-pleted the bulk of its work by the fall of2008 and published a comprehensive planand report for presentation to the FortCollins City Council in early 2009. TheUtilities also produced and filed a Sustain-ability Report with the Global ReportingInitiative, an international organization,headquartered in The Netherlands, tosupport worldwide sustainability. FortCollins Utilities is the first municipal elec-tric utility to file a sustainability reportwith GRI.

The baseline audit began in late 2007and touched upon all of Fort Collins Utili-ties’ service areas and administrativefunctions. The auditrelied upon GRIguidelines for meas-uring sustainabilityperformance. GRI isthe world’s mostwidely used standardframework for sus-tainability reporting,and uses a wide vari-ety of indices in sixkey areas: economic,environment, labor,human rights, soci-ety and productresponsibility. R.W. Beck is a registered or-ganizational stakeholder in GRI and wasinstrumental in sorting through the volumi-nous set of potential measures to find themost appropriate benchmarks for the fu-ture. The economic, environmental andelectric utility metrics were among the mostrelevant and constituted the bulk of the ini-tial audit in addition to a supplementalsection developed to capture water utilitymetrics. For example, since Fort Collins is apart owner of the Platte River Power Au-thority, the audit reported Fort CollinsUtilities’ share of the coal burned by theagency’s power generation facilities as867,000 tons in 2006. The Utilities also re-

ported using recycled paper for 60 percentof customer mailings and consuming morethan 69,000 gallons of fuel for its fleet of ve-hicles. Starting in 2009, Fort CollinsUtilities will report annually on selectedbaseline metrics. These metrics also formsome of the core content in the annual Sus-tainability Report.

Through a series of intensive work ses-sions in mid-2008, the Core SustainabilityTeam identified and endorsed four of themost pressing sustainability issues facingthe utility. These issues in turn solidifiedinto the four central goals and form thefoundational framework for the entireplan.

The first involves the issue of culture atFort Collins Utilities and calls specificallyfor “a cultural transformation that embedssustainability throughout the organiza-tion.”

The second focuses on external stake-holder engagement and calls for

“educating and motivatingstakeholders to support sus-tainability efforts.”

The third calls for incorporating “triplebottom line” business practices that opti-mize and balance economic, social andenvironmental considerations.

And the fourth takes the issue of cul-tural transformation a step further, bycalling for the Fort Collins Utilities’ workforce to be “empowered, engaged andsupported to achieve sustainability goals.”

Each goal is accompanied by a setof strategies and key performance indica-tors (KPI) to measure progress. The KPIsfor three of the four goals will be data-dri-ven, relying on annual surveys of the workforce and external stakeholders and cus-tomers. The KPIs for the triple bottom

■ A Journey to Sustainability

“Cultural change may be

the most difficult,” said

Steve Catanach, Light

and Power manager.


line goal is morefar-ranging andcaptures the sub-stance of thesustainability ef-forts. They will bebased in part on theannual GRI meas-ures, showingsteady progressagainst the baselineaudit. And they will be based in part onprogress toward meeting institutionallyestablished goals for renewables. Thestate of Colorado has a renewable portfo-lio standard calling for 10 percentrenewables by 2020 for municipal utilities.The goals for greenhouse gas reductionsare coincident between the state and thecity, calling for a 20 percent reduction(from 2005 emission levels) by 2020, and80 percent by 2050.

Members of the Core SustainabilityTeam believe the challenges posed by thefour major goals will be quite different.

“The triple bottom line may bethe easiest of the four toachieve because we can accom-plish this through procedures,

work practices, good management, andday-to-day operational behavior,” saidSteve Catanach, a key member of the teamand recently hired manager of Fort CollinsLight and Power. “Cultural change may bethe most difficult. It is one thing to changebehavior; it is another thing to change howpeople think. To make this work, we willneed to create a culture from top to bot-tom where sustainability is engrained inour spirit, a core consideration throughoutthe organization.”

Patty Bigner, manager of customer andemployee relations and the champion for

the external stakeholder issue, tends toagree. “I’m really intrigued by how weimbed sustainability in our culture; it isnot going to be easy. In contrast, the ex-ternal rollout is a relatively well knownprocess, but with a bit of a twist, since wehope to engage the community in a dis-cussion about sustainability. We areplanning several new ways of fosteringthis discussion. One of the things I’velearned in my career is that the more waysyou can reach and involve customers, thebetter results you get. This means we haveto really be out there in the community.”

Brian Janonis sees a strong bridge be-tween the internal and external goals. “Ithink the cultural transformation weachieve within the utility will go a longway toward inspiring the community,” hesaid. “I want us to help lead the commu-nity in the direction of sustainability.”

Through months of deliberation, theCore Sustainability Team came to appre-ciate that the efforts to change thecorporate culture would have to begin

“The more ways you can

reach and involve

customers, the better

results you get,” said

Patty Bigner, manager of

customer and employee

relations.

with the individual. Each person in theutility would have to take stock and exam-ine personal behavior and thoughtprocesses. Patty Bigner remembers howthis came home to the team in the earlydays of its deliberations. “One member ofthe team challenged us to make a per-sonal commitment to the project bymeasuring our energy use on a regular ba-sis, by examining our lifestyle, by payingattention to what it means to live moresustainably. In short, we were asked towalk the talk. What was remarkable wasthe impact this had, the ideas that bub-bled up as a result of this personalexamination. It really served to prime thepump, and made us realize that in five to10 years this will be a way of life for all ofus. We all know that because we have hadthis conversation, it will be impossible togo back. Our organization will never bethe same.”

The sustainability team’s next task wasto identify the potential field of sustain-ability-related programs at Fort CollinsUtilities and then to prioritize them. This

was accomplished through program prior-itization and use of an optimizationmodel. The team first developed a list ofall current sustainability-related programs,then developed a list of potential new pro-grams that might help Fort CollinsUtilities meet its objectives. With the helpof R.W. Beck, the team wrestled with thecomplex task of trying to evaluate andquantify the market reach and cost-effec-tiveness of each of these programs from atriple-bottom-line perspective and usedthese evaluations to winnow the list to amanageable set. They culled the list toaround 20 critical programs that wereused as a basis for optimization analysis.

An optimization model, inbroad strokes, is an analytical tool that car-ries out a simultaneous evaluation of avariety of factors to yield an optimum so-lution. In this case, the factors fed into themodel included sustainability goals, suchas greenhouse gas reduction targets, en-ergy efficiency goals, and renewableportfolio standard requirements, as well asa series of boundary conditions, such aslimitations on rate increases and financialresources. The strength of an optimiza-tion model lies in its flexibility, namely itsability to run different scenarios based on

varying inputs. You can add a new pro-gram, or subtract a program, for example,or accelerate or slow implementation andfind out the new optimum path to meetyour objectives.

Fort Collins Utilities relied upon an ad-vanced version of this tool. “In order tohelp Fort Collins Utilities define the nextbest dollar spent, we tailored our propri-etary model,” said Tim Corrigan,executive vice president of the energy sec-tor at R.W. Beck. “This will be a powerful,ongoing tool for the utilities to use as theymanage and modify their sustainability ap-proaches in the months and years ahead.”

This kind of model has a number oflong-term benefits. “It gives us the techni-cal criteria behind which we makedecisions,” said Janonis. “It takes the arbi-trariness out of the analysis, and providesongoing insight that can help us evaluatealternatives to meet our goals, as well asthe optimum rate at which to proceed.Importantly, it is going to help us concen-trate our efforts on those areas mosteffective in meeting our goals.” Some ofthe key programs that emerged from theanalysis with the highest payoff potentialinclude advanced metering infrastructure,commercial and residential energy effi-


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The sustainability project builds on an earlier project in Fort Collins to turn

the city’s old town neighborhood into a zero-energy district.


ciency programs, and green buildings pro-grams, as well as some programs muchless obvious. “For example, we have asmall hydro project that looks very prom-ising, one we will probably implement atour water treatment facility,” said Janonis.

Steve Catanach values the quantitativerigor of the analysis. “Beck’s model gives usa tool that can provide solid, repeatable in-formation to support a decision,” he said.

Patty Bigner likes the potential value itcan add in planning for community pro-grams. “The model adds transparency tothe decision making process,” she said. “Itprovides a way to explain to policymakersand the public what is constraining anddriving our decisions, and how we madeour decisions.”

The new sustainability plan is expectedto be well received by the Fort Collinscommunity. It dovetails with a wide vari-ety of other local initiatives, including thenew Climate Action Plan, the draft En-ergy Plan, a commitment by the city’srenowned Colorado State University tobecome carbon-neutral by 2020, and eco-nomic development strategies the city ispursuing.

“I see absolutely no disconnect be-tween where we are heading with Utilityfor the 21st Century and other city initia-tives including businesses, schools, CSUand the closely related Clean EnergyCluster,” said Atteberry, the city manager.

The entire economic develop-ment effort in Fort Collins is noworganized around five different economicclusters, including clean energy and bio-sciences, among others, which aredesigned to attract businesses that shareFort Collins’ commitment to sustainabil-ity. “We have 100 professors andresearchers at CSU dedicated to cleanenergy with the potential for spin-offventures,” said Atteberry. “I’m very ex-cited about connecting and leveragingthe city’s resources; by that I mean lever-aging the potential of our university, ourutility, and our economic strategies towork together.”

“One project that we are really proudof is the Zero Energy District, known asFort Zed,” said Janonis. “Building on an$8 million grant from [the U.S. Depart-

ment of Energy], local business and in-dustry have formed a partnership to carveout part of our service territory in an oldpart of town – primarily commercial andindustrial – and make it a net zero energydistrict. We’ll be starting out with somedistributed generation, renewables andsome automated metering infrastructurein the first phase. We’ll try to lean on asmall part of town before taking it to thewhole city.”

Fort Collins Utilities’ approach rein-forces the parallel efforts under way in theFort Collins Climate Action Plan and theEnergy Policy. The climate plan, whichcalls for a variety of voluntary activities toreduce the city’s carbon footprint, has tar-geted an ambitious reduction of between268,000 and 378,000 tons of carbon dioxideannually by 2012. This would keep FortCollins on the trajectory for an 80 percentgreenhouse gas reduction by mid-century.


The draft Energy Policy, which is expectedto be adopted this year, aligns with thecity’s Climate Goals. One of the potentialobstacles in the rapidly gathering civic mo-mentum toward sustainability is the factthat Fort Collins Utilities gets its powerfrom a joint action agency owned by fourdifferent cities, each with different demo-graphics and perspectives. The Platte RiverPower Authority obtains its power prima-rily from a 274-MW coal plant, four

combustion turbines, 10 wind turbines inWyoming, and federal hydro power pur-chased from Western Area PowerAdministration. The coal-fired electricity isthe bedrock of low rates in Fort Collins.“Sometimes that’s a hindrance—the factthat our power is so cheap—averaging 6cents per kWh retail,” said Janonis. It is in-evitable that renewables and sustainabilityprograms are going to put upward pressureon rates, he said.

“How do we influence the next genera-tion of power we use? How do we movefrom coal-burning power plants to muchmore sustainable sources? Those are criti-cal questions for the future,” saidAtteberry. “We have a very unique oppor-tunity as one of the owners of the PlatteRiver Power Authority to help find thebest pathway forward.”

Fort Collins is moving aggres-sively to give substance to its vision of a“Utility for the 21st Century,” and couldwell emerge as one of the national leadersin sustainability. If so, what advice wouldthey offer other municipalities thinkingabout embarking on this journey? Janonisoffers three pieces of advice. “First, un-derstand this will take a real level ofcommitment. It is not just window dress-ing. Second, identify the thought leaderswithin your own organization – whereverthey might be found — and pull them to-gether to form a creative, participatoryteam. Third, find someone to help guideyou through. Our consultants broughtbroad perspective from other thoughtleaders and utilities, real technical depth,and were particularly good at keeping usfocused on our strategic objectives.”

Patty Bigner’s advice: “Just start. Don’tbe intimidated by the perceived enormityof the undertaking. We have found eventhe smallest discussion generates far moreimpact than you might think. Once youstart, the path will lay out in front of you.”

Darin Atteberry emphasizes keepingthe broad strategic objectives foremost inyour mind. “Change is very hard, andtransformational change can be accom-plished only by setting a vision andkeeping a long-term perspective beforeyou. After all, long term is the essence ofsustainability.” ❚

Lynn Adams is a vice president at R. W. Beck, leading the firm’s utilitybusiness consulting initiative. Herrecent work has focused onintegrating sustainability approachesin response to legislative and marketdemands. She co-authored The Artof Strategic Leadership, whichdefines a planning methodology forbusiness direction.


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