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The
History of Lubbock Power & Light
by Don Cullon
In
the electric utility industry, retail competition for electric customers
is a relatively
 new
concept. Not so in Lubbock, Texas. The good people of Lubbock have
benefited from retail competition for electricity since 1916.
Lubbock was a relatively new town at the time having
been created in 1891 when two smaller settlements both moved their towns
from several miles away to our present location. The first county court
house was built at this time with the county itself having been created in
1876 by the Texas State Legislature. Construction of the Panhandle & Santa
Fe Railroad was completed in 1909. This led the citizens to incorporate
their town and Lubbock was officially born. The population of Lubbock the
following year had grown to 1,938.
1909 was also the year that
Lubbock first acquired electricity. The initial attempt to create a
power company came early in the year and
by June, Lubbock Electric Light & Power had been created and had
been granted a 25 year franchise by the county. The company apparently
could not meet the deadline set down by the county commissioners and
the business failed before construction could begin on a power plant.
The
next venture to come along was Lubbock Light & Ice, also formed in 1909.
This company received a charter from the city council on August 3rd and
began supplying a limited amount of electricity later that year. The
council allowed them to charge a maximum of twenty cents a kilowatt-hour
with a one dollar per month minimum charge. The franchise was to run for
25 years and the council reserved for the citizens the right to buy out
the private company with six months
notice.
The problems with Lubbock
Light & Ice began soon thereafter. The
manager of the company was charged with misappropriation of funds and
was removed sometime in 1910. Citizens thought the electric rates were
too high and felt the company was not expanding quickly enough. Electric
service was not available during the day and for part of the night. The
company claimed it would provide daytime service when the demand for
it increased.
By 1913 the owners of Lubbock
Light & Ice wanted out and in March
of that year sold the business to two brothers. The city council then
granted a 50 year franchise to the Malone brothers but required them
to lower rates to seventeen cents a kilowatt hour and to provide service
at all times during the night. The Malone brothers renamed the company
Malone Light & Ice. This company also failed to prosper and on November
7, 1915 the Malone brothers sold their operations in Lubbock, Lockney,
and Plainview to Texas Utilities. Records indicate that at some point
during 1915 electric rates had been reduced to fifteen cents a kilowatt-hour.
It is unclear whether the rate reduction was during the tenure of Malone
Light & Ice or came after Texas Utilities took over.
Soon after Texas Utilities
took over, the Lubbock plant was broken and out of service. Electricity
began being delivered from Plainview. This
was an extreme distance for the technology available at the time. The
quality of power was poor at best and the service was unreliable. Disapproval
of the high rates and poor service was now at an all time high and citizens
were becoming increasingly vocal. Electric rates were cheaper in Plainview
and this greatly displeased Lubbock officials. Beginning in March of
1916, a man was hired by the city for three months to read Texas Utilities’ meters
to verify electric consumption. Evidently the people no longer trusted
them.
Improvements were slow in coming and by October city and county officials
had met with representatives of Texas Utilities to discuss giving the
city and county better service and better rates. Negotiations failed
at this time and a second meeting was scheduled on December 21st. Records
indicate the citizens of Lubbock had a vote on the establishment of a
municipal power company. Most likely this vote was a bond election held
sometime after the October meeting and before December 15th, when the
city requested bids to build and equip a municipal power plant. This
was an apparent attempt to strengthen their bargaining position during
the upcoming December 21st meeting. The meeting took place as scheduled
on December 21st with members of the council asking for a rate reduction
to levels enjoyed by customers in Plainview. The only concession made
by Texas Utilities was a willingness to reduce rates slightly but they
refused all other requests including the one to provide Lubbock with
rates as low as Plainview. They apparently thought the city was bluffing
with their threat to build their own plant. It was no bluff. The Texas
Utilities representatives were asked to leave the meeting. Within a few
minutes the council voted to accept a proposal for a new municipal power
plant and the home-owned advantage became a reality for 4,700 Lubbock
citizens. As part of the proposal the Fairbanks-Morse Company agreed
to accept revenue bonds of the city in payment for the equipment it supplied.
The private power company representatives had underestimated the leadership
in Lubbock at that time. During the nine months that it took to get the
new plant built, Texas Utilities tried without success to sell its Lubbock
facilities to the city. The effort by those early Lubbock leaders was
realized a success on September 28, 1917 as the municipal power plant
began producing electricity priced at only ten cents a kilowatt-hour.
The other utility cut its rates accordingly soon after. Imagine that!
Electricity costs for citizens
would continue to fall with rates at seven cents a kilowatt-hour in
the 1930’s and at two and a half
cents a kilowatt-hour by the 1960’s. To understand why early citizens
thought the electric rates were too high, consider that the initial twenty
cents per kilowatt -hour rate would equate to more than four dollars
a kilowatt-hour in today’s dollars.
Over the years, Lubbock Power & Light has grown into a modern innovative
power company. There are three generating plants with 6 steam turbine
generators, 5 gas turbine generators and 2 diesel engine generators.
The combined generating capacity is 285.5 MW. Three 230 kV, 100 MW tie lines with Southwestern Public Service
provide alternative sources of power. There are over 79 miles of 69 kV
and higher voltage transmission lines. The transmission system is looped
around Lubbock such that each of major substations has redundant feeds.
Over 1000 miles of distribution lines feed more than 18,000 distribution
transformers with a combined capacity of 1244 MW.
Today, the vast majority of Lubbock remains dual-certified and customers
still have a choice of electric utility providers. Customers whose account
balances are current are allowed to switch from one company to the other
at their discretion. The competition for the electric dollar in Lubbock
has resulted in some of the lowest electricity costs in the state of
Texas and in the nation. Another major benefit of competition is that
customers enjoy increased levels of customer service than would be found
in cities this size with only one electric provider.
Lubbock Power & Light’s mission is to provide low cost, reliable electric
service. We feel we’ve been successful in that mission. All electric
customers in Lubbock have benefited from the decision of those early
pioneers to begin retail competition.
The Brief Version of the History of LP&L’s Competition.
The history of Lubbock Power & Light’s competition in Lubbock
is one of buyouts and corporate mergers. In 1909, Lubbock Electric Light & Power
Company was the first attempt at forming a private power company in Lubbock
but failed to get off the ground. Lubbock Light & Ice Company was
formed in 1909 shortly after the demise of the first company and was
somewhat more successful. But the expected profits couldn’t be
realized and the company was sold in 1913 to two brothers who renamed
the company Malone Light & Ice Company. That company also failed
to prosper and on November 7, 1915 the Malone brothers sold their operations
in Lubbock, Lockney, and Plainview to Texas Utilities Company. In 1936,
Texas Utilities merged with New Mexico Utilities to form Texas New Mexico
Utilities. They, in turn, allowed Southwestern Public Service to acquire
their assets in this area in 1942. SPS completed their merger with Public
Service of Colorado in 1997 and formed New Century Energies. The new
company merged with Northern States Power in August of 2000 and Xcel
Energy, Inc. became the newest version of LP&L’s competition.
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