Is Longhorn Electricity Worth It?

When Longhorn football kicks off at home a week from Saturday, so will a brand-new marketing effort aimed at peddling, of all things, green electricity.

Texas Longhorns Energy promises customers 100 percent power from Texas wind. "Let your power power the Texas Longhorns," says former star quarterback Colt McCoy, whose family has signed up, in a promotional video. Coach Mack Brown offers potential customers the chance to submit a pep-talk video that he might even show the team.

Texas Longhorns Energy officially launched a month ago with a slick website. A sister program, Aggie Energy, launches on Friday. The home football games for both teams, however, will mark the beginning of the big advertising blitz, with signs and videos. Decoder cards will be distributed at the games, allowing fans to go to the websites and enter a sweepstakes to win gear (or a year of free electricity!).

The programs may not be the best deal within the notoriously confusing Texas electricity market, but they are a way to support your favorite team while buying one of life's basic necessities. The universities will get about a half-million dollars per year — to start — from the marketing relationship, said Larry Weil, chief marketing officer for Branded Retail Energy, which put the deal together and is finalizing similar deals at five more major universities around the country. He has heard people muttering about gimmickry and strongly rejects it. "I think what we're doing is unique, and I think it goes way beyond a gimmicky thing," he said. "It's real energy from a real company. It's 100 percent renewable."

Chris Plonsky, UT's director of women's athletics, said the university had held "months and months of conversation" to determine whether the deal felt right. It seemed like the right time, she said, to get involved in the Texas electricity market, which saw the introduction of competition among electricity sellers in much of the state following deregulation. "Heretofore, it's been unexplored by our brand," she noted. Indeed, the program will buttress the branding-powerhouse reputation of University of Texas, which by at least one measure sells more branded stuff than any other university in the country (another recent example: a Tower-shaped water bottle, which created controversy for bucking greens' anti-bottled-water push).

 

Both Texas Longhorns Energy and Aggie Energy are outgrowths of a 1999 law that deregulated the Texas electricity market. Deregulation, which took effect in 2002, broke up the utility monopolies into pieces and spawned the creation of dozens of retail electric companies, including Champion Energy Services, the electricity retailer involved in the deal. Branded Retail Energy, run by Weil, a longtime sports marketer, played matchmaker between Champion and the universities. Retailers like Champion do not actually make electricity. Other companies do that, and still others, such as Oncor, transport it to homes and businesses through wires. The retailers simply sell the stuff, handle customer service and take a cut for their troubles, all in a fiercely competitive marketplace.

At UT, the athletics program will get initial money from allowing its name to be used in sponsorship arrangements. After 9,000 or 10,000 customers sign up for Texas Longhorns Energy, according to Plonsky, the university — working through IMG College, a sports-marketing company — will get a slice of additional revenue from new customers. Weil would not break down the amounts the university stands to make via these particular arrangements, but he said the deal should "mature" into a "nice seven-figure annual sponsorship" for each university.

Not the cheapest

Ironically, UT and Aggie officials cannot sign up for their own electricity product. That's because both Austin and College Station are part of the 25 percent of Texas that lies outside the "deregulated" — also called "competitive" — areas. Instead, they are served by municipal utilities. UT actually generates its own power, from a natural gas plant built in 1929.

Fans will want to understand their options before signing up, as with any purchase in the Texas electricity market. Texas Longhorns Energy costs more than some other available 100-percent-green-energy programs, which can be found on the state clearinghouse website powertochoose.org (TLE and Aggie Energy aren't listed there yet, but Weil said they will be soon). In downtown Dallas, for example, a yearlong, fixed-price deal with TLE may cost 1.4 cents per kilowatt-hour more than a 100-percent green power, fixed-price year with a company called Kinetic Energy. That may not sound like much, but for families using 1,000 kilowatt-hours of electricity per month, that adds up to an extra $170 or so per year. Weil noted, however, that offers are nuanced and constantly changing, and that the new university-linked products are priced competitively relative to green offerings from other major providers like Green Mountain Energy or Reliant Energy.

As a general matter, green energy costs more than regular electricity, which in Texas is a mix of mostly coal, natural gas and nuclear. But electrons from all sources, green and conventional, are co-mingled in the transmission lines — so technically speaking, no one can turn on the lights with pure wind power.

Tom "Smitty" Smith, the head of the Texas office of Public Citizen, a consumer and environmental advocacy group, praised the concept. "Green Horns? I think its a great sign that green is so cool that UT sees value in linking sports and renewable energy," he said in an e-mail. "Tall, strong, cutting edge and premium." 

Might it make more sense to buy power from another provider and give UT a separate donation? "Most people find a way to support UT as they're comfortable," Plonsky said. Similar options, she noted, include a Longhorns credit card marketed at UT alumni.

Selling the invisible

The retailers face a nearly impossible challenge: making people excited about buying their electricity — a commodity nobody can actually see. As a result, the salesmen have become quite creative. Last month, Reliant Energy in Dallas tried to entice customers by hosting an event with dancers and free tacos. Reliant has also resorted to lots of billboards, and this week it even launched its own rival program targeted at university alumni, promising a $25 donation to the customer's school of choice. Texas Longhorns Energy and Aggie Energy will mostly market themselves through the universities. "You'll see us at the games. You'll see us at UT related events," Weil said.

One notable nugget in all of this: Texas athletics programs are clearly trying to green their image. Football doesn't exactly conjure images of environmental stewardship — after all, the Godzillatron at Darrell K Royal-Texas Memorial Stadium gobbles up large amounts of energy, just for the air conditioners needed to keep it cool. Some enterprising UT students have created a design for solar panels flowing over the up the back of the scoreboard, to offset its energy usage. UT athletics officials also get e-mails about their daily power use, so that they can understand and perhaps control usage spikes. Plonsky said the Erwin Center, the UT basketball arena, has led the charge toward eliminating unnecessary energy usage.

Promoting green electricity jibes with UT's values of trying to teach students about conservation, Plonsky said: "This planet has to last a long time."

 

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