TWW Calls for Transparency and All Source Competitive Bidding in Tri-State Energy Planning Rules

Today the Colorado Public Utilities Commission (PUC) heard public comments on resource planning rules for Tri-State Generation and Transmission.  This is an important process which will create the guidelines for how Tri-State’s next Electric Resource Plan is implemented.   TWW called on the PUC to ensure that the final ERP rules are fully transparent and ensure competitive all source bidding to make sure that Tri-State’s local cooperative members and ratepayers receive benefits from the lowest cost resources. 

More specifically with regard to transparency, TWW noted:

 TWW believes that a full transparency is required for a successful ERP process.  Tri-State recently announced its “Responsible Energy Plan” but it is unclear how this facilitated stakeholder process will be incorporated with current and past ERP stakeholder requests.  TWW trusts that the “Responsible Energy Plan” will follow the traditional ERP stakeholder process and will adhere to the PUC’s new ERP rules formed in this proceeding, as well as providing opportunities for local cooperative members to weigh-in on the plan.   

Full transparency is also needed with regard to the data and information that Tri-State will be submitting to the PUC for its ERP to fully understand the complicated demands and needs of the Tri-State system.  TWW agrees with United Power, in their comments to this proceeding on September 25, 2019, with respect to the need for disaggregated data and for disclosure of members that have left or will be leaving the system and members that are intending to move to partial contracts.  Submitting aggregated data on energy and demand forecasts would be worthless for planning purposes and could lead to significant miscalculations of Tri-State’s complicated and interconnected system.  3605(b) of the proposed Rule would require that Tri-State submit energy and demand forecasts on a disaggregated basis for all of the member cooperatives is key to providing a full understanding of the system needs and requirements during the planning process.   

The ERP rules should also require transparency around the debt levels that Tri-State maintains.  Moody’s Investor Service recently noted, that the situation with Tri-State and Delta-Montrose “exemplifies a situation where the [rural cooperative’s] interest does not align with the [Tri-State] creditors’ interest.”  TWW has noted the connection between Tri-State’s debt service requirements on its $3 billion in debt and the impact on rates paid by local cooperatives.[1]  A clearer picture of how the existing debt load impacts future resource decisions and rates would benefit rural cooperative rate payers. 

On the issue of all source competitive bidding, TWW noted how some of Tri-State’s past non-competitively bid resource acquisitions have led to large financial write-downs and that the Colorado PUC has had a successful recent experience with Xcel Energy’s Colorado Energy Plan, a competitive bidding plan which led to significant savings for ratepayers.  Rural ratepayers in the Tri-State system should be afforded the same cost savings derived from all source competitive bidding.

All source competitive bidding for all new resources should also be a requirement for Tri-State to follow.  TWW appreciates Tri-State’s comments to this proceeding from September 25, 2019, which noted that Tri-State has and will continue to conduct competitive bidding for renewable resources.  TWW believes that all source competitive bidding is crucial to ensuring that rate payers are protected, and that Tri-State’s write down of $93 million for the non-competitively sourced Holcomb Expansion are avoided in the future.  An all source competitive bidding process for all of Tri-State’s future resource acquisitions would ensure that Tri-State receives the most up to date market signals based on price and optimal generation resources.  

[1]See Blog Post: In Response to TWW, Tri-State Contradicts Own Testimony on ‘Cheaper Prices’ and ‘Death Spiral’. (2019). Retrieved at: http://www.thewesternway.org/tww-blog/tristateletter

Western States Governors Ducey, Herbert, and Little Recognize National Clean Energy Week

Governors Doug Ducey, Arizona; Gary Herbert, Utah; and Brad Little, Idaho all signed resolutions marking the week of September 23rd as National Clean Energy Week in their states.  TWW applauded the Governor’s commitment to an all of the above state energy policy that powers each of their state’s economy, utilizes domestic resources, and provides environmental benefits. 

Gov. Ducey highlighted the importance that the Palo Verde Nuclear Generating Station plays to Arizona’s emission free electricity generation and the fact that Arizona has more cumulative solar energy installed than almost any state in the country.

Governor Herbert noted how Utah’s “all of the above market-based approach” to energy policy has put Utah on the cutting edge of a growing renewable energy sector which is helping drive Utah’s economy. 

Governor Little detailed how 75% of Idaho’s utility-scale net electricity comes from renewable sources.  Governor Little also noted that Idaho is the fourth largest generator of hydroelectricity in the country, has some of the best geothermal production in the country, and that the Idaho National Laboratory is driving new innovations in energy research and development which benefit Idaho and the entire country. 

Senator Cory Gardner Named 2019 Clean Energy Champion

Citizens for Responsible Energy Solutions (CRES) named Colorado’s Senator Cory Gardner a 2019 Clean Energy Champion and was honored during National Clean Energy Week.  Sen. Gardner was praised for his record of delivering balanced, bipartisan solutions to environmental and conservation challenges. 

“As a member of the Senate Committee on Energy and Natural Resources, with jurisdiction over energy generation and the bulk power grid, it’s an honor to be selected to receive the Clean Energy Champion Award from Citizens for Responsible Energy Solutions,” said Senator Gardner. “By focusing on responsible energy development, energy reliability and affordability, and the environment, we have the potential to make a better life for all Americans and our nation more secure.”

While many Republicans have dodged difficult issues related to conservation and the environment, Sen. Gardner leaned in and took a critical leadership role to address these challenges head on.  Sen. Gardner has driven balanced solutions that not only improve the environment, but also support the U.S. economy. Sen. Gardner has driven bipartisan environment and conservation solutions at a time Washington, D.C., has virtually succumbed to partisan gridlock. 

Being honored as a 2019 Clean Energy Champion is just the latest example of recognition that Sen. Gardner has received for his pragmatic approach which has served Colorado and the nation well over the last five years.

Sen. Gardner’s record on clean energy and conservation issues is unmatched, here are some of the other recent highlights and praise for his record: 

  • Sen. Gardner championed renewable energy before it was trendy. In 2015, Sen. Gardner was a leader in crafting a bipartisan agreement on tax credits for wind and solar (PTC & ITC) that would gradually ramp down, giving industry the certainty it needed to drive investments and make the renewable resource market competitive. Again in 2017, Sen. Gardner played a pivotal role in stopping proposed tax changes from wiping out the PTC and ITC. Today, Sen. Gardner is part of a bipartisan group of U.S. senators working toward the expansion of incentives for large-scale batteries and other energy storage projects. These efforts have resulted in renewable energy emerging as a cost-competitive resource that contributes to an all-of-the-above energy balance.

  •  Sen. Gardner announced as 2018 U.S. wind champion. In 2018, Sen. Gardner was named U.S. Wind Champion for the 115th Congress by the American Wind Energy Association (AWEA). “The Senator fights tirelessly creating opportunity for Coloradans, crafting fair tax policy, strengthening energy security with transmission infrastructure, and securing funding for breakthrough wind power research at NREL,” said AWEA CEO Tom Kiernan.

  •  Sen. Gardner demands climate response based on science. Sen. Gardner is a national leader for science-based research and technologies to combat climate change. In 2017, Sen. Gardner co-sponsored bipartisan legislation to shield scientific agencies from political interference — an effort that drew high praise from the scientific community. “We are gratified that these Senators have not only helped to advance Earth and space science but also have put aside partisanship to further sound science policy,” the American Geophysical Union said.

  •  Sen. Gardner receives science champion award. In 2019, The Science Coalition presented Sen. Gardner with its distinguished Champion of Science Award, which honors leaders whose actions and votes consistently reflect their commitment to fundamental science research.

  •  Sen. Gardner led the most significant conservation legislation in a decade. Sen. Gardner led a bipartisan effort to pass what The Washington Post described as “the most sweeping conservation legislation in a decade, protecting millions of acres of land and hundreds of miles of wild rivers across the country.” The legislation combined more than 100 different conservation bills and permanently reauthorized the Land and Water Conservation Fund (LWCF), which funds critical outdoor projects across America without any taxpayer dollars.

  •  Sen. Gardner earned national parks award. The National Parks Conservation Association awarded Sen. Gardner with the National Park Heritage Award in 2019 to recognize his leadership on public lands and conservation issues.

Sen. Gardner’s accomplishments on environmental and conservation policy are objectively remarkable for a first-term U.S. senator. According to Georgetown University and the Lugar Center, Sen. Gardner is one of the top five most effective members for driving bipartisan solutions in the U.S. Senate.

Senators Call on Leadership to Fully Fund LWCF

A bi-partisan group of U.S. Senators are calling on leadership from both parties to fully and permanently fund The Land and Water Conservation Fund.  Nine senators, including Colorado’s Cory Gardner and Michael Bennet and Montana’s Jon Tester and Steve Daines, called on congressional leaders to fulfill the original promise of the LWCF.   

 “As you work to enact legislation that will address Federal funding needs for fiscal year 2020 and beyond, we urge you to seize the opportunity for including a bipartisan win for future generations—full, permanent funding for the Land and Water Conservation Fund (‘LWCF’). This investment would protect and conserve our national parks and public lands, support the nation’s $887 billion outdoor recreation economy, and finally fulfill the original promise of the LWCF,” wrote the senators.

“We strongly urge Congressional leaders to seize the historic opportunity and enact legislation to this longstanding priority in the 116th Congress,” wrote the senators.  “We look forward to working with you as you begin consideration of funding for fiscal year 2020 and beyond.”

 The full letter can be found here.

SRP and Partners Lead on Long-term Forest Stewardship

In an effort to restore healthy forests and protect critical watersheds in Arizona, SRP, the U.S. Forest Service, the U.S. Bureau of Reclamation, the Arizona Commerce Authority, and the Arizona Department of Forestry and Fire Management released a major RFP to promote a sustainable industry that can provide large-scale forest restoration.   This five-member partnership known as the Four Forest Restoration Initiative (4FRI) is an innovative response to combating wildfires and ensuring water supply and infrastructure. 

TWW commends SRP and the other four partners for addressing a critical issue with a new approach that aims to cut down bureaucracy and create a viable market that will drive forest stewardship.    

The RFP calls for one or more large-scale, long-term stewardship contracts that will reduce forest fuel loads, improve forest health, and improve wildlife and plant diversity. The 4FRI area includes more than 2.4 million acres of which more than 1 million acres need mechanical thinning. The goal of 4FRI is to mechanically thin 50,000 acres per year. The health of these watersheds and prevention of catastrophic wildfire is critical to the long-term sustainability and reliability of SRP’s water supplies and infrastructure.

In a release, SRP highlighted the importance of the project and why they are involved:

“To understand why SRP is so involved, it's first important to understand why forest health matters to the greater Phoenix metropolitan area as a whole. Forests in northern and eastern Arizona are the lifeblood of SRP's water supply. The runoff from rain and snow that fall on those forests flows downstream, filling reservoirs on the Salt and Verde rivers. When those forests are healthy, they protect winter snow-pack, preventing it from melting too fast, and filter runoff so that water flowing into reservoirs is clean and relatively free of sediment. SRP’s watersheds are in five national forests with almost 60% of the land area within the Salt and Verde River watersheds and 100% of the East Clear Creek watershed being managed by USFS. SRP operates and maintains the federal reclamation project’s seven reservoirs and associated water works that provide a reliable and sustainable water supply to municipal, agricultural and industrial customers in the greater Phoenix metropolitan area.

Unhealthy and overgrown forests on National Forest System lands are fuel for large catastrophic wildfires that affect the health of the Salt, Verde and East Clear Creek watersheds. Massive wildfires make average precipitation events extremely destructive; accelerating flood flows and runoff, eroding soils, depositing sediment into water storage reservoirs, and ultimately causing hundreds of millions of dollars in increased treatment costs and reduced water storage capacity.”

Read more about the RFP and 4FRI partnership here and here.

Tapping Geothermal Can Propel Nevada Communities Forward, says Guinn

Rural communities in Nevada are welcoming the Bureau of Land Management proposal to open up public lands for geothermal energy production.

On Sept. 17, 2019 the agency is set to launch the bidding process that would open up 141 parcels of public land totaling 386,837 acres across Churchill, Eureka, Elko, Esmeralda, Humboldt, Lander, Mineral, Nye, Pershing, Washoe and White Pine counties. As a result, it’s expected to be the largest act of its kind in state history.

Becoming a leader in geothermal energy production is in the best interest of our state and for our rural communities.

Why is this important? Geothermal is a profitable renewable energy source. Our resources are ranked among the best in the country. Moreover, geothermal energy is reliable and cost-effective, and isn’t tied to fuel costs. Importantly, geothermal is not an intermittent source of energy, but generates energy every day around the clock.

Earlier this year our organization, The Western Way, released an economic impact study on rural renewables in Nevada. It assessed 29 rural renewable projects that were constructed from 2006 to 2017. In that time frame, these projects generated a total of $7.9 billion for their local economies that led to the creation of 12,000 jobs, resulting in  $947.3 million in wages. Overall, $152.3 million in state and local tax revenues were generated. This resulted in measurable economic benefits for rural Nevada.

As the federal government controls 84% of public lands in our state, BLM’s plan to enable safe exploration and development of geothermal energy production on public lands should be applauded. Their plan perfectly falls in line with a multiple-use, sustainable-yield view of land management that is good for both the environment and the economy.

The agency’s announcement to open up geothermal leases also aligns perfectly with the Trump administration’s America-First Energy Plan, an all-of-the above energy plan including fossil fuels and renewable sources like geothermal that can be produced on public lands.

Energy independence is critical for our nation’s well-being and for the consumer. With this in mind, Congress should consider and act on H.R. 3794 — the bipartisan Public Land Renewable Energy Development Act of 2019 to further spur development of rural renewables here in Nevada. If passed, this bill would encourage and permit the production of geothermal energy on public lands and create a new revenue sharing mechanism to bolster local communities even further.

Our organization was formed to drive conservative leadership on western conservation and environmental issues. We work with local governments to reduce red tape and bring information regarding new energy sources like geothermal to counties that desire it. Exploring and developing geothermal energy, for instance, aligns with a limited-government, balanced-use philosophy that is returning to natural resources development and land management.

The Silver State has the potential to increase rural renewable energy production of geothermal sources. Our communities will substantially benefit from the influx of investment dollars, new jobs and more tax revenue.

This heavily underutilized resource has the potential to propel our state, and the rest of the country, into the future — a future with a clean energy outlook.

Blake Guinn is the Nevada Director of The Western Way (TheWesternWay.org), a nonprofit organization urging Western conservative leaders to acknowledge actual environmental challenges and deliver efficient, pro-market solutions.

This piece originally ran in the Reno Gazette Journal on September 13, 2019.

Administration Delivers on Expanded Access for Hunters and Anglers on Public Lands

Just in time for hunting season, today Secretary of the Interior David Bernhardt announced major expanded hunting and fishing opportunities on our country’s public lands.  Hunters and anglers will have new opportunities at 77 National Wildlife Refuges and 15 National Fish Hatcheries.   The majority of these expanded opportunities are found in the Western United States and include special places like Wyoming’s Seedskadee NWR which will now be open to white-tailed deer and elk hunting on its 24,437 acres.   In Colorado, the Hotchkiss National Fish Hatchery will be open to sport fishing for the first time in it’s history.  In Arizona, seven National Wildlife Refuges ranging from Havasu to Kofa will expand hours, season date ranges, and the methods of take. 

 “This is the largest single effort to expand hunting and fishing access in recent history,” said Secretary Bernhardt. “President Trump has made increasing public access and streamlining government functions priorities of his administration, and this new rule delivers on both fronts given the unprecedented expansion of public acreage and removal or revision of 5,000 hunting and fishing regulations to more closely match state laws. This is a big win for sportsmen and sportswomen across the country and our collective conservation efforts.”

According to the U.S. Fish and Wildlife Service’s National Survey of Fishing, Hunting and Wildlife-Associated Recreation, hunting, fishing and other outdoor activities contributed more than $156 billion in economic activity in communities across the United States in 2016. Over 101 million Americans — 40 percent of the U.S. population age 16 and older — pursue wildlife-related recreation, including hunting and fishing.

Prior to opening units for hunting and fishing the U.S. Fish and Wildlife Service develops specific management plans for each refuge or hatchery and ensures continued compliance through annual reviews. Through responsible habitat and species management more Americans will have the opportunity to hunt and fish on their public lands.     

The final rule also cuts red tape by simplifying over 2,900 refuge specific regulations to comply with President Trump’s mandate to reduce the regulatory burden on the public. 

BLM to Hold Largest Geothermal Lease Sale in Nevada History

On September 17th the Bureau of Land Management will offer 141 parcels totaling 386,837 acres for competitive bidding of geothermal leases.  The parcels located in Churchill, Eureka, Elko, Esmeralda, Humboldt, Lander, Mineral, Nye, Pershing, Washoe, and White Pine counties in Nevada will be the largest geothermal lease sale to ever take place in the state.  Nevada’s geothermal resources are ranked among the best in the country and customers benefit from reliable around the clock renewable power that is not tied to fuel costs.  NV Energy currently has 486 MW of installed nameplate geothermal energy capacity in the state through 19 different projects. 

The BLM announcement of the lease sale noted:

“In keeping with the Administration’s goal of strengthening America’s energy security, the BLM supports an all-of-the-above energy plan that includes oil and gas, coal, hydroelectric, and renewable sources such as wind, geothermal, and solar – all of which can be developed on public lands.”

BLM started leasing geothermal projects in 1978, and currently manages over 800 geothermal leases. 50 of them are in producing status generating 1,648 MW of power across the country, enough to power 500,000 homes and accounts for 40% of the country’s geothermal energy production.  Geothermal leases on BLM lands generate over $12 million in Federal royalties annually with 50% going to states, 25% going to counties and the final 25% going to the federal government.   

Earlier this year, TWW released an economic impact study on rural renewables in Nevada and provided a case study of the potential economic benefits of new geothermal facilities being built in Nevada.  Specifically the case study examined adding a 75 MW facility in Lyon County which would result in:    

  • The total direct and indirect benefits of construction activity in Lyon County could be an estimated $14.9 million in total output ($10.9 million direct output + $4 million indirect and induced output) produced by 26 employees (18 direct employees + 8 indirect employees) earning a total of about $2.3 million ($1.8 million direct earnings + $505,000 indirect earnings) during the construction period.

  • The total direct and indirect benefits of annual operations in Lyon County could be an estimated $8.9 million in total output ($7.4 million direct output + $1.5 million indirect and induced output) produced by 42 employees (21 direct employees + 21 indirect employees) earning a total of about $3.1 million ($2.4 million direct earnings + $715,000 indirect earnings). The benefits will include an annual direct fiscal benefit to Lyon County of an estimated $323,100.

Wyoming Wind Repowering Project Means Additional Tax Revenue

Pacificorp announced that it has acquired sole ownership of the Foote Creek I wind generation facility in Carbon County, Wyoming.  Pacificorp plans to repower the facility which was Wyoming’s first utility scale wind project commissioned in 1999.  The 41.4 mW facility led the way for Pacificorp to invest billions of dollars in wind farm development across the west over the last two decades resulting in Pacificorp as the largest regulated utility owner of wind assets in the west. 

“Twenty-one years ago, PacifiCorp and its partners’ development of Foote Creek I helped pave the way for utility-scale wind energy as an industry-defining demonstration project,” said Stefan Bird, president and CEO of Pacific Power. “Today, this new investment in the project builds on our vision to even better harness wind energy and power the grid with increased efficiency, delivering even more low-cost, renewable energy to our customers.”

 The 68 existing 600 kW turbine generators that were originally installed will be replaced with 13 state of the art turbines with higher capacity levels increasing the energy output of the facility by 60 percent.  The repowered facility will be able to power 19,500 homes.  Over the next 30 years, the project is expected to generate an additional $14 million in tax revenue for Wyoming. 

 “Acquiring full ownership and repowering Foote Creek I provides a unique opportunity to upgrade the company’s oldest wind plant, located in one of the most favorable wind energy sites in Wyoming, applying the latest technology so that it can continue to serve our customers well into the future,” said Gary Hoogeveen, president and CEO of Rocky Mountain Power.

Sen. Cory Gardner's Commitment to Conservation is Unmatched

In 2020, Colorado has one of the most competitive U.S. Senate races in the country, and the political attack ads have already begun.

The left wing’s opening salvo, including Conservation Colorado’s recent piece published in The Colorado Sun, claims that Sen. Gardner has not delivered on his campaign promises to support the environment.

Conservation experts will tell you that could not be further from the truth.  

While many Republicans have dodged difficult issues related to conservation and the environment, Sen. Gardner leaned in and took a critical leadership role to address these challenges head on. Sen. Gardner has driven balanced solutions that not only improve the environment, but also support the U.S. economy. Sen. Gardner has driven bipartisan environment and conservation solutions at a time Washington, D.C., has virtually succumbed to partisan gridlock.  

This pragmatic, solutions-based approach is exactly what voters should demand from our elected officials and should reject extreme positions that get nowhere and pulls our country apart.

Distinguishing political spin from facts can be tricky, so let’s examine Sen. Gardner’s actual record on environment and conservation issues since he was elected U.S. senator less than  five years ago:  

  • Sen. Gardner led the most significant conservation legislation in a decade. Sen. Gardner led a bipartisan effort to pass what The Washington Post described as “the most sweeping conservation legislation in a decade, protecting millions of acres of land and hundreds of miles of wild rivers across the country.” The legislation combined more than 100 different conservation bills and permanently reauthorized the Land and Water Conservation Fund (LWCF), which funds critical outdoor projects across America without any taxpayer dollars.

  • Sen. Gardner earned national parks award. The National Parks Conservation Association awarded Sen. Gardner with the National Park Heritage Award in 2019 to recognize his leadership on public lands and conservation issues.

  • Sen. Gardner championed renewable energy before it was trendy. In 2015, Sen. Gardner was a leader in crafting a bipartisan agreement on tax credits for wind and solar (PTC & ITC) that would gradually ramp down, giving industry the certainty it needed to drive investments and make the renewable resource market competitive. Again in 2017, Sen. Gardner played a pivotal role in stopping proposed tax changes from wiping out the PTC and ITC. Today, Sen. Gardner is part of a bipartisan group of U.S. senators working toward the expansion of incentives for large-scale batteries and other energy storage projects. These efforts have resulted in renewable energy emerging as a cost-competitive resource that contributes to an all-of-the-above energy balance.

  • Sen. Gardner announced as 2018 U.S. wind champion. In 2018, Sen. Gardner was named U.S. Wind Champion for the 115th Congress by the American Wind Energy Association (AWEA). “The Senator fights tirelessly creating opportunity for Coloradans, crafting fair tax policy, strengthening energy security with transmission infrastructure, and securing funding for breakthrough wind power research at NREL,” said AWEA CEO Tom Kiernan.

  • Sen. Gardner demands climate response based on science. Sen. Gardner is a national leader for science-based research and technologies to combat climate change. In 2017, Sen. Gardner co-sponsored bipartisan legislation to shield scientific agencies from political interference — an effort that drew high praise from the scientific community. “We are gratified that these Senators have not only helped to advance Earth and space science but also have put aside partisanship to further sound science policy,” the American Geophysical Union said.

  • Sen. Gardner receives science champion award. In 2019, The Science Coalition presented Sen. Gardner with its distinguished Champion of Science Award, which honors leaders whose actions and votes consistently reflect their commitment to fundamental science research.

  • Sen. Gardner established caucus to drive bipartisan solutions. Just last week, Sen. Gardner founded a GOP conservation caucus. The new Roosevelt Conservation Caucus will “embrace and promote constructive efforts to resolve conservation and environmental problems that align with market-based approaches and promote American ingenuity.”

Sen. Gardner’s accomplishments on environmental and conservation policy are objectively remarkable for a first-term U.S. senator. According to Georgetown University and the Lugar Center, Sen. Gardner is one of the top five most effective members for driving bipartisan solutions in the U.S. Senate.

While Colorado’s 2020 U.S. Senate race will draw outlandish claims from all sorts of special interest groups, Sen. Gardner’s record delivering balanced, bipartisan solutions to environmental and conservation challenges is beyond reproach. 

This piece from TWW’s Jon Anderson was published by The Colorado Sun on July 28, 2019.

Barrasso Moves Major Transportation Infrastructure Legislation

U.S. Senator John Barrasso (R-WY) scored a major victory for transportation infrastructure this month when his bipartisan legislation, America’s Transportation Infrastructure Act, passed out of the Senate Environment and Public Works Committee markup with a unanimous 21-0 vote.  The legislation invests $287 billion in our country’s roads, bridges, and transportation infrastructure.  This is a critical investment to maintaining a strong economy. 

The legislation also addresses emissions reductions in the transportation sector by dedicating funding and creating a new set of incentives to reduce emissions through efficiencies, new infrastructure, and mitigating traffic congestion.  Through a grant program the legislation will result in new infrastructure for alternative fuel vehicles, (including electric, natural gas, and hydrogen fuel cells), in highway corridors where the infrastructure doesn’t exist.  This ensures that rural regions of the country are not left behind as new technologies come to the market.  The bill also requires that federal agencies create a strategy to transition their fleets to electric, hybrid-electric, and alternative fuels within a year of enactment.

The legislation will also direct $250 million in funding towards a wildlife crossing pilot program that will reduce wildlife-vehicle collisions.  The Federal Highway Administration has reported that there are more than 1,000,000 wildlife-vehicle collisions every year.  This program will provide for crossing structures that will not only improve safety on our highways but will be part of effective wildlife corridors.    

Co-sponsor Senator Tom Carper (D-DE) and Senator Barrasso noted in a joint opinion piece why addressing critical transportation infrastructure is so important:

Our response is simple. Give states the money, flexibility, and incentives to build safer and more modern highway and bridge systems that will connect more Americans, power our economy and endure the test of time for the next decade and beyond. Our legislation streamlines government regulations while prioritizing environmental protection so that projects are built better, faster, cheaper and smarter.

In the same piece the Senators also noted that:

Our climate is changing, and we recognize that. We also recognize the need to reduce carbon emissions from our transportation infrastructure. Dedicated funding and new incentives in our legislation will help states reduce their total transportation emissions. For example, states can get funding to help mitigate traffic congestion in urban areas. They also can choose to develop plans to reduce transportation related emissions and compete for additional funds if they meet or exceed them.

TWW encourages the full Senate and House to move quickly on this bipartisan legislation and send it the President Trump’s desk where he has indicated support for the deal. 

Nevada’s PUC Should Consider Economic Development Benefits of Rural Renewables

TWW submitted comments to the Nevada PUC today highlighting the importance of considering rural locations for utility scale renewables that will be built to implement Senate Bill 358.

Renewable energy is an economic driver. A report we commissioned in partnership with the Carson Valley Chamber of Commerce shows that renewable energy projects in rural Nevada benefit the state and rural communities with a significant amount economic impact. From 2006 to 2017, 29 rural renewable projects led to a total output of $7.9 billion that flowed into the Nevada economy, created 12,056 Nevada jobs, paid $947.3 million in wages paid to Nevada employees, and resulted in over $152 million in tax payments to state and local governments.  These projects help drive investment and jobs to regions of our state that often go overlooked. 

Rural Nevada has the key assets to rapidly increase our state’s share of renewable energy: ample land; community interest; nearly limitless solar, wind and geothermal resources; and workers eager to for these development opportunities. These counties are open for business, ready to welcome new developments that will strengthen their economies and create good-paying jobs. The rest of Nevada would benefit, too, by tapping into homegrown power from our rural neighbors without having to buy electricity from California or other states.

Roosevelt Conservation Caucus Drives Leadership on Commonsense Conservation

Earlier this week, Senators Cory Gardner (CO) and Steve Daines (MT) announced the formation of a bicameral Roosevelt Conservation Caucus.  Senators Gardner and Daines, both of which will co-chair the caucus along with Sen. Lindsay Graham (SC), were joined by their colleagues from the Senate and the House to spell out the why they formed the group and its importance to leadership in the national debate on conservation and environmental issues.   

 “In Colorado we are blessed with abundant and diverse natural resources, and we take pride in being responsible stewards of the environment,” said Senator Cory Gardner (R-Colorado), co-chair of the Senate Caucus. “Every American should want to protect the environment and pass our beautiful country on to the next generation better and cleaner than it was given to us. I’m proud to stand with my colleagues today to officially launch the Roosevelt Conservation Caucus, a platform that will help shine more light on Republican efforts on innovative, economically viable policies which will both improve the environment and make sure the American people continue to have the highest quality of life possible.”

Members said the caucus would give a platform to “effective and common-sense solutions to environmental and conservation issues.”  TWW could not agree more that our country is in need of solutions that will improve our environment without crippling our economy.   TWW applauds the leadership from Roosevelt Conservation Caucus leaders.

 “Thanks to capitalism and technological advancements, millions of Americans enjoy one of the cleanest environments and highest standards of living,” said Senator Lindsey Graham (R-South Carolina), the co-chair of the Senate Caucus.  “Unleashing solutions that enhance and protect our environment are essential to ensuring economic growth, energy independence, and national security.”

 

Gov. Herbert has Turned Utah into a Leader in Energy Innovation by Focusing on “All of the Above”

At the end of May, Utah Governor Gary Herbert hosted his annual Energy Summit which was a true display of how an “all of the above energy strategy” can unleash innovation to build the economy and protect the environment.  Over, 1,100 attendees heard from notable speakers including Secretary of Energy Rick Perry, Wyoming Governor Mark Gordon, members of Congress, and CEO’s from a variety of energy companies and utilities. 

Gov. Herbert made several major announcements at the conference including the world’s largest clean energy battery facility, a DOE grant for geothermal energy development, and a multi-state agreement on natural gas development was also expanded.  Taken individually these are major innovation announcements in the energy sector but announced on a single day shows that Gov. Herbert’s strategy to welcome all sources of energy development is paying off.

More details on Gov. Herbert’s major energy project announcements are below:

  • ACES Project – Mitsubishi Hitachi Power Systems and Magnum Development launched a 1 GW Advanced Clean Energy Storage (ACES) project in central Utah.  It will be the largest energy storage of its kind in the world.  The project in Millard county will utilize the region’s unique salt domes to employ four types of storage technologies including, renewable hydrogen, compressed air storage, large scale flow batteries, and solid oxide fuel cells. 

  • DOE FORGE Project – In what was described as a once in a lifetime opportunity, the Department of Energy announced that Milford, Utah was selected as the location for the Frontier Observatory in Geothermal Energy (FORGE).  Utah will receive $140 million in funding for the next five years for cutting edge research and development in enhanced geothermal recovery utilizing techniques similar to oil and gas industry’s hydraulic fracturing process.

  • WSTN Signing Ceremony – Gov. Herbert’s Office of Energy Development led a ceremonial signing to expand the Western States and Tribal Nations Agreement on natural gas to include the Wyoming Pipeline Authority.  The coalition aims to market clean burning western natural gas to international markets which would be a financial boon to rural counties in the west and the Ute tribal nation. 

Summarizing Utah’s work as a leader in energy innovation, Dr. Laura Nelson, head of the Governor’s Office of Energy Development and the Governor’s Energy Adviser said that Utah,  “…is committed to creating and building the strategic partnerships that provide local, regional and global leadership for powering a sustainable, reliable and affordable energy economy.  Governor Herbert's strategic energy plan continues to accelerate unprecedented investment, innovation and workforce opportunities for Utah's diverse energy landscape and provide the energy future that delivers global solutions to meet ever-evolving market demands."

AZ Utility SRP Leads with New Energy and Water Goals

TWW congratulates the Salt River Project (SRP) Board of Directors for formally adopting new Sustainability Goals for 2035.  The goals will now include increased measures to reduce carbon emissions, increase grid reliability, and improve water resiliency.  The Board’s changes to the plan came after five months of engagement with stakeholders and customers and a public comment period that resulted in over 4,000 comments. 

This transparent and public process resulted in updated 2035 Sustainability Goals that were originally approved in 2017.  New goals addressing forest restoration, water conservation, energy efficiency and power generation water use were introduced.

“Through this collaborative effort, SRP has deepened its commitment to long-term sustainability,” said SRP Vice President John Hoopes. “These Board-approved goals are more robust and will help SRP demonstrate leadership in addressing the implications of climate change, including carbon reduction, water conservation and forest health.”

SRP is a community-based, not-for-profit public power utility and the largest provider of electricity in the greater Phoenix metropolitan area, serving more than 1 million customers. SRP is also the metropolitan area’s largest supplier of water, delivering about 800,000 acre-feet annually to municipal, urban and agricultural water users.

Below are the five pillars of the new 2035 Sustainability Goals:

Reduce carbon footprint

The energy sector is responsible for about one-third of greenhouse gas (GHG) emissions in the U.S. SRP will strive to decrease carbon dioxide (CO2) emissions, the primary GHG, from power generation, our internal operations and through other initiatives.

Goals:

·       Reduce the amount of CO2 emitted (per megawatt-hour) by 62% from 2005 levels by 2035 and by 90% by fiscal year 2050.

·       Reduce carbon emissions from facilities by 30% on a mass basis.

·       Reduce carbon emissions from fleet by 30% on a mass basis.

Ensure water resiliency

Through ongoing water management and conservation efforts and by exploring new water resources, SRP will continue to maintain a safe, reliable and resilient water supply.

Goals:

·       Reduce water use at our facilities by 45% on a mass basis.

·       Achieve lost and unaccounted for water rate of less than 5% on a 10-year rolling average.

·       Eliminate or offset power generation groundwater use in Active Management Areas.

·       Achieve 20% reduction in generation-related water use intensity2 across all water types.

·       Store 1 million acre-feet of water supplies underground – that's almost 326 billion gallons.

·       In partnership with Valley cities, support municipal water conservation goal achievements by creating and executing programs to identify 5 billion gallons (approximately 15,300 acre-feet) of potential water conservation by 2035.

Promote a sustainable supply chain, reduce waste

SRP will manage our product choices and purchasing strategies to encourage sustainable best practices. We are recognized for our efforts in recycling, reuse and repurposing operational waste materials to keep them out of landfills.

Goals:

·       Incorporate sustainability criteria into sourcing decisions for 100% of managed spend.

·       Divert 75% of municipal solid waste by 2035 and achieve 100% by fiscal year 2050.

·       Divert 95% of non-hazardous industrial solid waste sent to our Investment Recovery department.

Enable our customers and the grid

SRP will continue to ensure the reliability, flexibility and security of our grid through innovative applications, optimizing existing resources and robust monitoring and analytics. This will enable customers to take advantage of advanced technologies and energy solutions.

Goals:

·       Customer programs:

·       Energy Efficiency – Deliver over 3 million megawatt-hours of annual aggregate energy savings.

·       Demand Response – Deliver at least 300 megawatts of dispatchable demand response and load management programs.

·       Electric Transportation – Support the enablement of 500,000 electric vehicles (EVs) in SRP's service territory and manage 90% of EV charging through price plans, dispatchable load management, original equipment manufacturer integration, connected smart homes, behavioral and other emerging programs.

·       Electric Technologies – Expand portfolio of electric technology (non-EVs) programs to deliver 300,000 megawatt-hours of annual aggregate energy impact.

·       Grid enablement: Enable the interconnection of all customer-sided resources, including solar photovoltaic (PV) and battery storage, without technical constraints while ensuring current levels of grid integrity and customer satisfaction.

Engage with our communities

SRP is committed to building a sustainable future for all, leading by example and enhancing the communities in which we live and serve. We connect the values of our customers and employees to our business practices each day.

Goals:

·       Achieve at least 80% of customers who give SRP a positive rating for its sustainability efforts.

·       Engage 100% of employees in efforts that contribute to SRP's sustainability goals.

·       Increase SRP's leadership role in forest restoration treatments through partnerships, influence, education and support for industry to thin 50,000 acres per year or 500,000 acres total.

In Response to The Western Way, Tri-State Contradicts Own Testimony on ‘Cheaper Prices’ and ‘Death Spiral’

In early April, the Western Way published a report, Rural Energy at a Crossroads: Electric Cooperatives Trapped in a System Causing High Energy Costs. The report explores years of conflict between rural electric cooperatives and their wholesale power provider, Tri-State Generation and Transmission Association, over rate increases and the cost of servicing the association’s $3 billion debt load. In 2016, Kit Carson Electric Cooperative in New Mexico paid $37 million to exit the Tri-State monopoly and now a Colorado cooperative – Delta-Montrose Electric Association – is also trying to leave under similar terms.

More than three weeks later, Tri-State published a blog responding to our so-called “false claims.” But attacking our work – which we stand behind – does nothing to address the legitimate concerns of rural cooperatives about rising wholesale power rates within the Tri-State monopoly when cheaper options are available elsewhere.

Just as troubling, some of Tri-State’s claims are flatly contradicted by Tri-State’s own statements filed with the Colorado Public Utilities Commission (PUC) and the U.S. Securities and Exchange Commission (SEC). This should be seriously concerning to policymakers, cooperatives in the Tri-State system and interested members of the public.  Excerpts are below from a May 6, 2019, letter sent to Tri-State CEO Duane Highley from TWW raising these contradictions: 

1)  Tri-State’s Response claims rates are “competitive” and “well positioned for the changes and transitions ahead BUT Tri-State filings have acknowledged that competing sources have lower costs that could cause a “death spiral” for Tri-State.

 Tri-State’s response to the Report states: “Our wholesale rates are competitive … our association is financially strong and well positioned for the changes and transitions ahead.” This statement directly contradicts Tri-State’s formal position before the PUC.  Tri-State conceded months ago in official testimony to the Colorado PUC that Delta-Montrose is trying to leave “because cheaper prices are now available elsewhere.”[i] Also, Delta-Montrose should not “be permitted to escape [a 40-year contract with Tri-State] now that the market price has fallen,” Tri-State argued in the same testimony, filed on Jan. 15.[ii]

 In addition, on April 29, 2019 (one day after Tri-State issued its response to the Report) Tri-State filed additional testimony with the PUC not only acknowledging that competing sources have lower costs but this fact could cause a “death spiral” if members are allowed to leave Tri-State without paying an exorbitant exit fee:

 “The levelized costs for new renewable electricity generation are decreasing. Tri-State has out-of-market generation and significant remaining fixed costs and associated debt. I think it is incumbent on the remaining members to consider what has been described as a potential ‘death spiral.’

 If departing members do not hold harmless remaining members, this could start a growing procession of other self-interested members wanting to depart and join new associations or enter alternative purchase power agreements.”[iii]

 Tri-State’s response to the Report claims that that Tri-State’s rates are “competitive” and “well positioned”  but, in fact, Tri-State’s has already admitted that competitor rates are lower and keeping members in place and paying above market rates is necessary to avoid a “death spiral.”

 2)  Tri-State’s Response claims that “debt is not driving rate increases” but Tri-State has repeatedly affirmed that debt is a significant driver in setting rates.

Tri-State’s response to the Report states: “Tri-State’s debt is not driving rate increases.” However, one day after making this statement, Tri-State submitted testimony to the PUC that directly connected debt maintenance to wholesale rates.   “As security for its loans, lenders require Tri-State to charge rates to its Members that produce revenues sufficient to enable Tri-State to pay its debts.”[iv]

 In fact, Tri-State has made similar disclosures to federal financial regulators at the SEC and investors who may be interested in buying Tri-State debt. For example, Tri-State’s latest 10-K report describes the “master indenture” that covers most of the association’s $3 billion in debt:

 “Under the Master Indenture, we are required to establish rates that are reasonably expected to achieve a DSR [i.e. Debt Service Ratio] of at least 1.10 on an annual basis. The Master Indenture also requires that we review rates promptly at any point during the year upon any material change in circumstances which was not contemplated during the annual review of Member rates.”[v]

 In effect, a DSR of 1.10 gives Tri-State creditors the power to keep wholesale electricity rates high enough to cover debt payments plus a 10 percent margin of safety. The DSR requirement also makes it extremely difficult to reduce wholesale rates and keep pace with competing sources without risking default.

 In a 2015, presentation to investors, Tri-State provided more detail on this point:

 Tri-State’s master indenture provides for a lien over substantially all of Tri-State’s assets. … The DSR requirement of 1.10 ensures that we have adequate cash flow to cover our debt payments…”[vi]

 According to the same presentation, after years of increases, Tri-State’s average wholesale rate in 2015 was 7.1 cents per kilowatt hour. Since then, it has increased further to 7.5 cents per kilowatt hour.

 Tri-State’s testimony and disclosures to state and federal regulators clearly show that debt is a significant driver in setting wholesale rates on the Tri-State system. Not only that, it’s fueling the conflict between Tri-State, Delta-Montrose and other rural electric cooperatives seeking cheaper sources of electricity.  As Moody’s Investor Service recently noted, the current situation with Tri-State and Delta-Montrose “exemplifies a situation where the [rural cooperative’s] interest does not align with the [Tri-State] creditors’ interest.”

 Tri-State’s blanket response that “Tri-State’s debt is not driving rate increases” is not accurate and is in direct conflict with Tri-State’s own statements to regulators, investors, and the public.

TWW welcomes criticism and respects the right of Tri-State managers to defend their interests and respond to outside scrutiny however they choose. But telling one story to the public and another story to state and federal regulators does not help Tri-State’s cause.

 

Notes:

[i] Mot. to Dismiss Formal Complaint, Delta-Montrose Electric Association v. Tri-State Generation and Transmission, No. 18F-0866E (CO PUC), pg 1.

[ii] Id. at pg. 33.

[iii] Answer Testimony and Attachments of Charles J. Cicchetti, Ph.D. on behalf of TSGT, Delta-Montrose Electric Association v. Tri-State Generation and Transmission, No. 18F-0866E (CO PUC), pg 30.

[iv] Public Answer Testimony and Attachments of Ricky L. Gordon on behalf of TSGT, Delta-Montrose Electric Association v. Tri-State Generation and Transmission, No. 18F-0866E (CO PUC), pg 19.

[v] Tri-State Generation and Transmission Association, Inc. (2019) 2018 10-K form. 

[vi] Tri-State Generation and Transmission Association, Inc. (2016) April 29, 2016 Form 8-K.

Rural Energy at a Crossroads: Electric Cooperatives Trapped in System Causing High Energy Costs

Full Report Link

A new study conducted by The Western Way examines the massive structural changes in U.S. electricity markets over the past 10 years – in particular, rapidly falling prices for natural gas and renewable energy that have created lower cost energy alternatives for consumers– but rural consumers remain tied to electric cooperatives that are not capturing these market competitive energy solutions. 

The study details the critical situation facing rural electricity cooperatives in western states that that are trapped in the Tri-State Generation and Transmission system that is resulting in unsustainable electricity rate increases.  Key findings of the study include:

  • In western states, Tri-State Generation & Transmission is now charging 212% more for electricity than competitive wholesale providers in the same region. 

  • From 2000-2016, Tri-State members experienced 12 rate increases resulting in increases of 103%.

  • Tri-State now has over $3 billion in debt and has been forced to increase rates to maintain that high debt load.

  • From 2013 to 2018, Tri-State’s net margins fell from $73 million to $43, meaning even higher electricity rate increases for rural consumers appear inevitable in order to comply with terms of its Master Indenture.

  • Cooperatives attempting to leave the Tri-State system to capture cost savings now available through energy advancements in renewables and natural gas are being forced to pay unreasonable exit fees.  

  • State and local leaders must engage to create changes to ensure rural electricity consumers regain access to market competitive energy options.

AZ Rural Renewables Generate $9.4 billion

The Western Way, in partnership with the Yuma County Chamber of Commerce released, “The Economic Benefits of Arizona Rural Renewable Energy Facilities.”  The economic impact study, conducted by Development Research Partners, found that 34 rural renewable projects constructed in Arizona from 2001 to 2017 resulted in significant economic benefits to rural Arizona, including:

·       $9.4 billion contributed to the Arizona economy;

·       17,971 Arizona jobs;

·       $1.2 billion in wages to paid to Arizona employees; and

·       $16.7 million in state and local tax revenues benefiting Arizona.

The study also found that rural renewable facilities continue to contribute to the Arizona economy after construction is complete.  Annually these projects contribute an estimated $63 million and sustain over 700 jobs with combined wages of over $33 million.  The facilities also contribute nearly $1 million in annual property tax revenue benefiting Arizona schools. 

“Rural Arizona has some of the best solar resources in the country and this report shows in great detail how the industry is benefiting our state with increased jobs and economic opportunities,” said Jaime Molera, Arizona Director of The Western Way. “Over the last decade, market forces drove technological improvements leading to drops in the prices of utility scale solar which are cost competitive for utilities and can save rate payers money.  More investment in utility scale renewables will grow Arizona’s rural economy.” 

The study also tested the economic and fiscal benefits of adding new solar and battery storage facilities in Arizona.  The model test case was a new 100MW-solar PV facility with a 30MW battery storage component in Yuma County.  The report showed the model solar plus storage project would result in a total economic output of $9.1 million for construction and $1.3 million direct and indirect benefits annually. 

UPDATED: #LandsPackage2019 Passes House with a vote of 363-62

Update: On February 26th, the House also passed #LandsPackage2019 (SB.47) by a wide bi-partisan majority just weeks after the Senate passed the package on a vote of 92-8, both votes send a strong bi-partisan message on the importance of conservation and public lands.

The bill was the most important conservation package to pass the Senate in the last 10 years. Sen. Cory Gardner (CO) was instrumental in working with leadership and shepherding the package through the Senate.

Most notably the package included a permanent authorization of the Land Water Conservation Fund (LWCF), which has been vital to driving the growth in the outdoor recreation economy across the Western U.S. Additionally, the package protects 1.3 million acres as wilderness, establishes four new national monuments, adds three new national parks units, and makes all federal lands open to hunting fishing, and recreational shooting unless otherwise specified.

Upon passage of the bill Senator Gardner said:

“After four years of working on this issue, the Senate was finally able to permanently reauthorize the crown jewel of conservation programs, the Land and Water Conservation Fund. I have championed this program throughout my time in the Senate because of how important it is to all Coloradans who love our great outdoors. The program has a direct impact on public lands in Colorado and will be used to protect our state’s natural beauty for future generations. I’m thrilled we were able to finally permanently reauthorize this commonsense program supported by Coloradans across the political spectrum. This is a great day for the future of Colorado’s public lands.”

TWW thanks the Western Senators who overwhelmingly voted in favor of the lands package, including:

  • Arizona: McSally & Sinema

  • Colorado: Bennet & Gardner

  • Idaho: Crapo & Risch

  • Montana: Daines & Tester

  • Nevada: Cortez Masto & Rosen

  • New Mexico: Heinrich & Udall

  • Utah: Romney

  • Wyoming: Barrasso & Enzi

TWW Supports Colorado Measure for On-Site Manufacturing of Wind Turbines

Colorado state legislator, Rep. Rod Pelton recently introduced, HB-1165, which provides a temporary exemption from property taxation of Business Personal Property used to manufacture wind turbines at the site they will be placed into service.  The temporary exemption would last for ten years, beginning in 2020 and ending in 2030.

On-site manufacturing allows for taller wind turbines which capture more wind energy and produce electricity cheaper than shorter ones.  The next generation of wind turbines will sit on towers approximately 500 to 600 ft tall compared to current towers that are around 300 ft tall. 

Physical limits on the diameter of wind turbine towers that can be transported over highways have limited the height of wind turbines.  Rep. Pelton’s bill provides an incentive for wind developers using the emerging technology of on-site manufacturing to site future wind farms in Colorado.

More wind development in Colorado will increase the economic impact of the wind industry which has a serious benefit to rural communities.  Wind farms pay property taxes, unaffected by this bill, that benefit counties, school districts, fire districts, library districts, and water districts.   On-site wind turbine manufacturing facilities are estimated to create 50 to 100 local jobs depending on the size of the project. Currently, wind farms are estimated to pay land owners in Colorado nearly $8 million in annual lease payments. 

A temporary exemption from BPPT in Colorado will drive the next generation of wind turbine construction to be located in the state and rural communities will benefit from the economic impact of the decade’s long lifespan of the wind farms.