Austin Energy seeks to dampen fears of cooling department employees

Despite assurances that Austin Energy is not currently contemplating a sale of its District Energy and Cooling Department, called the DEC, some employees remain concerned that the utility might decide to sell the cooling system, which provides chilled water cooling for producing electricity. According to the utility, “overall, Austin Energy’s district cooling facilities serve more than 20 million square feet (>7x the Empire State Building) and will soon have 64,000 tons of cooling capacity.”

Bradley Jarrell, a supervisor of two of Austin Energy’s cooling plants, has explained in a letter to City Council and members of two commissions that oversee the utility that he had “serious concerns regarding the proposed sale of the District Energy and Cooling Department (DEC) and the lack of communication from Austin Energy (AE) management.”

That sale was put on hold last summer, and Deputy General Manager and Chief Operating Officer Lisa Martin says the utility is not currently considering a sale. However, she said AE might hire an outside firm to perform an analysis “assessing what the various options are.”

The utility was losing money on the DEC and continues to do so, according to Austin Energy spokesperson Matt Mitchell. The Austin Monitor reported last year that the utility was losing about $5.2 million on the system in 2023. Mitchell said the number is currently about the same as it was then.

Jarrell said in his letter that the lack of communication from upper management had “created a critical situation that threatens the operational integrity of our plants and the well-being of our staff. Desperate for information, a majority of our staff attended the latest Resource Management Commission meeting, both in person and virtually. This unprecedented level of staff engagement underscores the depth of concern and frustration regarding the lack of communication from Austin Energy.”

According to Jarrell, two highly qualified operators left their positions with the DEC for other city jobs. He said he was concerned that other employees would also leave, noting that two others had been interviewing for other positions. He added, “Our highly skilled staff are the backbone of these critical operations. We are facing a crisis of staff attrition that threatens our ability to maintain safe and reliable service.”

In response to Jarrell’s letter, Austin Energy General Manager Bob Kahn wrote a letter to City Council and members of the two commissions, expressing sympathy with the employees and attempting to reassure them that their jobs are not in jeopardy. He said that although the evaluation of a potential sale was halted, “it may still be helpful to seek a neutral third-party financial analysis of all potential options to grow the system. We are assessing whether and how to proceed with such an analysis.”

Paul Robbins, vice chair of the Resource Management Commission, has been seeking information on the DEC since last summer. At its Feb. 18 meeting, he asked fellow commissioners to sign on to a resolution asking a variety of questions about the district chilling system. The commission agreed to the resolution asking that Austin Energy staff attend the next meeting of the commission and provide information about the DEC. Martin told the Monitor they would definitely be present at the next meeting, which is scheduled for March 25. In the meantime, she said staff would be meeting with some members of the commission to provide them with relevant information.

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