BOULDER - Xcel Energy is behind schedule on making Boulder a SmartGridCity, but the company said it's moving forward with the first two phases of the project simultaneously and doesn't think the entire schedule will be delayed.

In March, Xcel said it would install 15,000 smart meters on homes and businesses by the end of August, but by the end of October it has only installed about 8,000.

Tom Henley, Xcel spokesman, said the company has installed about 8,050 smart meters since May, but the company anticipates having the rest installed by the end of 2008. That means another 7,000 meters must be installed in the next two months.

"We definitely think we'll be done with the meters by the end of the year," he said, adding, the company still is anticipating a $100 million price tag, 10 percent to 15 percent of which Xcel will pay.

Henley said hard ground and hurricanes were the two main reasons for the delay.

"One of the reasons Boulder is called Boulder is because of the soil source," Henley said.

Crews installing fiber optics are having a rough time digging. Fiber optic lines are being used to allow the two-way communication between the smart meters and Xcel Energy to help determine when the energy system is stressed or another problem exists.

Henley said crews that were contracted to install portions of the smart grid traveled south to work following this summer's hurricanes. He said the crews were able to make more money in a short amount of time, which temporarily put the SmartGridCity project on hold.

Since phase 1 started in March, Xcel has upgraded two substations with smart technology that allows the company to determine when overloads are about to occur, have occurred or when problems with the grid arise.

The substations will also allow Minneapolis-based Xcel Energy (NYSE: XEL) to determine when a transformer is about to fail allowing the company to setup a portable transformer to offload some energy if needed. That would avoid a large power outage, Henley said.

Xcel has upgraded about 981 transformers, which help step-down energy so customers can use it, as well as five "feeders" that are part of the substations and also help step-down energy.

But because of safety concerns and value of the substations, transformers and feeders, Henley wouldn't divulge where the upgraded units are located in Boulder.

"People wouldn't know the difference (anyway)," he said.

As part of the Smart Grid implementation, Xcel is setting up a plug-in hybrid electric vehicle test program.

In addition to the hybrid vehicle that will be used by University of Colorado at Boulder Chancellor G.P. "Bud" Peterson and his wife, Val, as part of their smart home, Xcel is working with Boulder County to retrofit three of the county's Toyota Prius hybrids.

When plugged in, the modified hybrids allow Xcel to use the vehicle's battery to feed the grid if needed. Then, the battery could recharge during nonpeak hours or when renewable energy sources are powering the grid.

The Petersons should receive the donated vehicle for CU in November, Val Peterson said.

As part of the study, the energy company is looking to raise about $6 million to help advance the vehicle-to-grid program, Henley said. That includes a proposed 60 additional plug-in vehicles, further testing and installation of charging stations.

Next on Xcel's implementation list for SmartGridCity is an additional 35,000 smart meters, completion of the fiber optics installation, two substations, 20 "feeders," and enabling Web portal access for all smart meter customers, according to Xcel's Web site.

Henley said 10,000 of the 35,000 planned smart meters should be available to Boulder homeowners and businesses on an opt-in system as long as the customer is close to the fiber optic network.

While he knew little of the proposed opt-in plan, Henley said Xcel customers should receive more information later this year or early next year, or they can call customer service.

Contact writer Ryan Dionne at 303-440-4950 or e-mail rdionne@bcbr.com.