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.

Nevada’s Rural Renewables Generate $7.9 Billion in Economic Impact

The Western Way, in partnership with the Carson Valley Chamber of Commerce released, “The Economic Benefits of Nevada Rural Renewable Energy Facilities.”  The economic impact study, conducted by Development Research Partners, found that 29 rural renewable projects constructed in Nevada from 2006 to 2017 resulted in significant economic benefits to rural Nevada, including:

·       $7.9 billion contributed to the Nevada economy;

·       12,056 Nevada jobs;

·       $947.3 million in wages to paid to Nevada employees; and

·       $152.3 million in state and local tax revenues benefiting Nevada.

The study also found that rural renewable facilities continue to contribute to the Nevada economy after construction is completed.  Annually these projects contribute $187.5 million to the state economy.  This includes ongoing wages of over $61.3 million earned by 1,144 employees and local and state taxes of $6 million per year.

Blake Guinn, Nevada Director of The Western Way, said, “Nevada has the best solar and geothermal resources in the country.  This study demonstrates the significant impact this industry currently has on the Nevada economy and, more importantly, demonstrates the enormous economic opportunity in Nevada to further develop these resources. Utility scale renewables are cost competitive, create jobs, and generate tax dollars for communities throughout the state. Advancing the development of these resources will drive Nevada’s rural economy.”

The study also tested the economic and fiscal benefits of adding new geothermal and solar facilities in Nevada.  The model test case was a new 75MW-Geothermal facility in Lyon County and a 100 MW-Solar PV Facility in Nye County.  The report showed the model geothermal project would result in a total economic output of $14.9 million for construction and $8.9 direct and indirect benefits annually.  The potential solar project would yield $2.5 million in total economic output and annual operations would generate $1.9 million.

Executive Director of the Carson Valley Chamber of Commerce, Bill Chernock said, “The results of this study show just how significant renewable energy is to our state’s overall economy and how future projects could boost our local economies.  These projects can drive significant investments, jobs and reliable annual tax revenues to regions of our state that are too often overlooked.” 

“Make the lame duck less lame” – Move Forward Legislation that Protects Outdoor Rec. Jobs and Landmarks

On November 29th Western Senators Cory Gardner (CO) and Steve Daines (MT) led a group of bipartisan members of congress in calling for full funding and permanent re-authorization of the Land and Water Conservation Fund (LWCF).  Sen. Gardner made an impassioned call to action for his fellow U.S. Senators and U.S. Representatives to stand up and fight for LWCF before the end of the year.  Sen. Gardner called LWCF: “…the most important conservation program, this country has, the crown jewel of our conservation efforts at no cost to taxpayers.”  

LWCF is critical for Western sportsmen and Western state economies.  Gardner noted a recent news article which highlighted the large number of inaccessible acres of public land spread throughout the West.  LWCF can be used to help open up access of these public lands for hunting, fishing, and other outdoor recreation activities.  Over 269,000 acres of federal public lands in Colorado are inaccessible, an area the size of Rocky Mountain National Park.  Across the West number is estimated at 9.5 million acres of inaccessible federal public lands. 

Creating access to these lands helps the rural economies of the Mountain West by letting them tap into the outdoor recreation economy’s huge annual estimated spend of nearly $900 billion and 7.5 million jobs. 

Utah Legislature Supports Rural Energy Development

In continued support of an “all of the above” energy policy, the Public Utilities, Energy, and Technology Interim Committee of the Utah Legislature adopted a committee resolution in the recent November Interim Hearings. The resolution which will next be considered by the full legislature and the governor in 2019 calls for support of commonsense energy policy by advancing rural development of wind, solar, hydrogen, and geothermal energy.

The resolution identifies the crucial role rural areas of the state play in energy development and also recognizes the economic benefits of the expansion of these types of energy resources. The resolution also supports the state moving to producing wind, solar, hydrogen, and geothermal energy as a product to export to states across the western United States.

The resolution was adopted unanimously by the committee and will be formal presented as a committee resolution when the Utah Legislature formally convenes in January of 2019. The full text of the resolution can be found here: 

TWW's Nevada Team works to Support Free Market Energy Policies

TWW's Nevada Director Blake Guinn has been busy supporting free market energy policies in Nevada.  Guinn has attended and participated in a variety of town-halls and community discussions focused on Nevada's future energy policies. 

This coming election, voters will decide whether or not to move forward with the Energy Choice Initiative, (Question 3) which would allow new energy generators to come into the state and create a competitive market. The initiative would make unlawful, pursuant to an amendment to the Nevada State Constitution, for an energy monopoly to exist starting in 2023. The campaign for Energy Choice has become the costliest campaign in Nevada history with over $100 million funded from both Yes and No.

TWW Hears From Utah Leaders on Critical Issues

On October 16th, The Western Way held a round-table discussion with conservative leaders in Utah to talk about the critical environmental and energy issues facing the Beehive State.  TWW appreciated hearing from the in-state experts on a wide variety of major issues ranging from Payments In Lieu of Taxes (PILT) payments and wildfire prevention strategies to mine reclamation and rural energy development.        

The next day, Utah’s Public Utilities Energy & Technology Interim Committee met to look at the specific factors that limit development of wind, solar and geothermal in rural Utah and what changes might be in order to drive more economic development.

TWW’s Bob Beauprez led the conversation and shared why TWW has been successful in working across Western states to help educate and forge relationships that result in reasonable solutions to environmental problems. The dynamic conversation in Utah, furthered TWW’s belief that Western States are leading the nation in developing commonsense policy solutions.

TWW’s Nevada Team Tours Switch’s TAHOE RENO campus

Switch, a world leader in datacenter design, operations, and development, opened its doors to TWW’s Nevada team and local leaders from Northern Nevada to tour their TAHOE RENO campus this month.  Switch is an innovative world leader in datacenters and the company has designed their facilities to be able to handle the next 30 years of technological advancement. The facility in Northern Nevada allows for Switch to plug and play with future technology, which is unlike any other data center currently in the existence.   Over 500 patents are pending or have been granted to Switch to optimize data center design, heating and cooling, energy efficiency and other technology.   

In large part, Switch gains its competitive market advantage by tackling one of the industry’s highest costs – energy.  Switch has been an industry leader in moving towards 100% renewable energy usage, which they own and buy through power purchase agreements at rates over half the cost provided by the regulated utility.  Switch initiated Nevada’s Energy Choice Initiative and has been a strong proponent of letting a competitive market place drive lower rates for all other residential and commercial users across the state. 

Switch is using technological innovation, harnessing efficiencies, and breaking the conventional framework to become an industry leader in a highly competitive market.  All the while, showing that good environmental stewardship makes for a strong bottom line.  Switch is truly an example of how innovators in Western States are pioneering solutions that support the economy and improve the environment. 

Leaders from Across the Eastern Plains Support the Colorado Energy Plan

Colorado’s Public Utilities Commission is scheduled to begin deliberations soon on the Colorado Energy Plan and rural leaders from the Eastern Plains recently submitted a joint letter of support to the PUC highlighting the importance of the plan to their region’s economy and to ratepayers across the state.

In the letter seven county commissioners from Logan, Prowers, Yuma and Cheyenne counties outlined the economic benefits that the Colorado Energy Plan would have by spurring new investment in rural Colorado. The Commissioners wrote:

“Colorado’s rural communities face unique challenges and opportunities that are not shared by urban centers along the Front Range. Rural Colorado has fallen behind in key economic areas and it is affecting our local communities. Serving as a leader in renewable energy production is not only a source of pride in our counties but it is a key economic factor that will help us grow and strengthen our local communities. Rural Colorado stands ready to deliver the benefits of the Colorado Energy Plan across the entire state.”

Greg Brophy, director of The Western Way’s Rural Energy Network, applauded the support for the plan saying, “Community leaders from across the Eastern Plains showed their strong support for the Colorado Energy Plan. It's especially telling that commissioners from counties that stand to gain absolutely nothing from the CEP recognize that it's good for rate payers and for rural Colorado.”

The Arizona Energy Modernization Plan Would Boost the Arizona Economy and Create Arizona Jobs

Arizona Corporation Commissioner Andy Tobin’s Energy Modernization Plan makes sense for Arizona and The Western Way is glad that the ACC has decided to move forward with the rule-making process.  The Energy Modernization Plan is a major policy decision that would shape how customers pay for electricity and where that electricity comes from.  It deserves to be reviewed with the due diligence ensured by the ACC process.  The plan was based on several years of outreach and meetings and officially proposed on January 30th of this year.   

Many western states are currently in the process of debating important changes to energy policy that could lead to more competitive rates and attractive business climates, Arizona cannot afford to be left behind as new innovations and technology are changing the energy sector landscape.  The Energy Modernization Plan is a balanced energy portfolio approach which many neighboring states have successfully adopted years ago.  Arizona needs an “All of the Above” energy policy, with an emphasis on controlling costs, saving ratepayers money, managing demand, reducing waste, creating jobs and helping businesses.

The plan is a win in both the short term and the future. More immediately, ratepayers would not have to spend as much building costly new power plants. Over the decades, it would also save money because Arizona would transition to sources of energy that cost less — and are continuing to go down in price. This is the sensible and appropriate approach to energy policy, unlike the California based ballot initiative that would force irresponsible policies on our state and increase costs for Arizona families. 

The Western Way Announces Arizona Advisory Board

The Western Way is pleased to announce its Arizona Advisory Board.  The Board will help TWW identify and provide guidance on the pertinent conservation issues in Arizona.  The Western Way is grateful to have the opportunity to benefit from the knowledge and expertise of these Arizona leaders who bring so much experience on the critical issues facing Arizona.  

TWW Arizona Advisory Board

• Rusty Bowers serves as a state representative in LD25. Bowers has years of experience in the legislature. He currently serves on the Appropriations and Education Committees and is chairman of the Energy, Environment and Natural Resources committee. Rusty served with honor and distinction for several years in the Arizona legislature before engaging in several community and career endeavors. Rusty has had an active career in construction, education, the legislature and as a professional artist who is well-known for his outstanding talents, skills and diverse artistic ability.  Bowers is a fourth generation Arizonan and attended Maricopa Community College, ASU and Brigham Young University.

• T.J. Shope serves as a state representative in LD8. In the House of Representatives, Shope has served on the House Committee on Agriculture & Water as well as the House Committee on Energy, Environment & Natural Resources. He currently serves as the Speaker Pro Tempore of the House as well as chairing the House Committee on Rules. T.J. has received recognition from all types of organizations because of his work at the capitol. He won the "Freshman of the Year" award from the Arizona Mining Association, was recognized as one of the "Tech Ten" legislators by the Arizona Technology Council, and many other impressive accolades. 

• Karen Fann serves as the state senator for LD1. Senator Fann was elected in November of 2016 to represent Legislative District 1, which covers 8,000 square smiles throughout Yavapai County and portions of Maricopa County. She previously served this district from 2011 to 2016 as a State Representative. Karen is the owner and CEO of a highway construction company specializing in the installation of guardrail and signs throughout the State of Arizona, which recently celebrated its 33rd business anniversary. Karen is a licensed contractor with the Arizona Registrar of Contractors, past president of Yavapai County Contractors Association and past president of Prescott Chapter National Association of Women in Construction. 

• Lisa Atkins was appointed in 2015 by Governor Ducey to serve as State Land Commissioner (approved unanimously by the Senate).  Ms. Atkins, when asked to serve by Governor Ducey, requested that she be allowed to stay on the Board of Central Arizona Project (CAP) where she was elected to serve as the President of the Board. Lisa Atkins has a long history of service to the State of Arizona, with more than 40 years of experience in the federal and state legislative and policy arenas. Ms. Atkins served for more than 23 years as Chief of Staff to Congressman Bob Stump, 18 months as the Executive Director of the County Supervisors Association of Arizona and 11 years as the Vice President for Public Policy for Greater Phoenix Leadership (GPL). Ms. Atkins also serves as a member of the Arizona State Parks and Trails Board and the Arizona Military Affairs Commission, of which she is co-chair.

• Cheryl Lombard has more than 20 years experience in politics, public affairs, media and community relations, and nonprofit management. She became the President and CEO of Valley Partnership in March 2015. Before joining Valley Partnership, Cheryl was the Government Relations Director for The Nature Conservancy in Arizona. There she received many awards and most recently served as the Co-Chair of Arizona Governor Doug Ducey’s Transition Committee on State Lands. She has previously served on Arizona Governor Jan Brewer’s Transition Team. Cheryl was the Director of Public Affairs with Davies Communications in Santa Barbara, California where she headed the Land Use/Real Estate Group and led several commercial and residential development clients successfully through the California land entitlement process.

• Peter Hayes serves as Chief Public Affairs Executive and Associate General Manager of Salt River Project. Mr. Hayes served as Head of Public Affairs at Salt River Project since July 2011. Peter Hayes is responsible for managing relationships with all governmental entities, as well as public involvement, consumer affairs and community outreach. SRP is one of Arizona’s largest utility companies. They provide electricity to approximately 1 million retail customers in a 2,900-square-mile service area that spans three Arizona counties, including most of the Phoenix metropolitan area. SRP's water business is one of the largest raw-water suppliers in Arizona. They deliver about 800,000 acre-feet of water annually to a 375-square-mile service area and manage a 13,000-square-mile watershed that includes an extensive system of reservoirs, wells, canals and irrigation laterals.

Sen. Cory Gardner Urges the Senate to Protect Outdoor Rec. Jobs and Landmarks

On July 12, 2018, Senator Cory Gardner (CO) urged his colleagues in the U.S. Senate to permanently reauthorize the Land Water Conservation Fund (“LWCF”).  Sen. Gardner took to the Senate floor to discuss the importance of LWCF and also signed on as a co-sponsor to S.569, which would authorize and fund the program.  LWCF, which does not require any taxpayer dollars, is critical for western sportsmen and western state economies.  

LWCF programs maintain critical infrastructure and open access to public lands in support of hunting, fishing, and other outdoor rec. activities that have become key economic drivers in Colorado and other western states.   The outdoor recreation industry is estimated to  have a total annual spend of $886.8 billion and drive over 7.5 million jobs across the country.  In the Mountain West alone, the outdoor industry generates $104.5 billion in consumer spending, creates 925,000 jobs, and contributes $7.6 billion to state and local taxes.

LWCF has been in existence for 52 years.  In Colorado, LWCF investments totaling over $265 million have helped preserve national treasures like Great Sand Dunes National Park and Rocky Mountain National Park but the program has also played a critical role in local parks, open spaces and education centers that connect the next generation of outdoor enthusiasts to the land. 

The Western Way applauds Senator Gardner for his leadership on LWCF permanent authorization and full funding.

TWW's Rural Energy Network Members Tour Rush Creek

Members of TWW’s Rural Energy Network recently toured Xcel Energy’s Rush Creek I Wind Farm in Elbert County, Colorado.  The 600 MW wind project will include two wind farms and 83 miles of transmission lines to connect the generated energy with users on the Front Range.  This eastern plains project will be built out across Cheyenne, Elbert, Kit Carson, and Lincoln counties – home to some of Colorado’s best wind resources.  The project is using wind turbines built by Vestas at its three Colorado manufacturing sites in Pueblo, Windsor and Brighton. 

The Rush Creek project is estimated to inject $1 billion into the state’s economy and will have a significant impact on rural economies.  TWW’s Rural Energy Network has seen how important projects like Rush Creek are to their local communities.  These projects not only generate construction jobs on the front end but grow the tax base which in-turn supports needed local government services.  Eastern Colorado has also seen an increase in high paying jobs for wind technicians, which has driven the creation of certificate programs at local community colleges.  

Progressive 15, a Northeastern Colorado Chamber, recently quantified the economic impact that renewable energy projects have on Colorado’s Eastern Plains counties.  The report found:

• Total direct and indirect economic benefit of construction and investment activity in renewable energy facilities in eastern Colorado from 2000 to 2016 was an estimated $2.7 billion in total output
• Projects produced 5,919 worker-years (2,595 direct employees + 3,324 indirect employees) earning a total of about $302.6 million ($154.2 million direct earnings + $148.4 indirect earnings) during the construction period.
• Total direct and indirect economic benefits of operating eastern Colorado’s renewable energy facilities is an estimated $138.7 million in total annual output.

Arizona’s Salt River Project Leads on Battery Storage Integration

Salt River Project (SRP) recently began construction of Arizona’s first standalone battery storage project intended to provide flexible peaking capacity.  The 10 MW storage system can deliver the equivalent energy needed to power 2,400 homes for up to four hours.  More importantly, however, is that the project serves as a signal that storage technology has quickly become a market competitive option for utilities. 

Industry estimates, which forecast that lithium-ion capital costs will drop by 36% over the next five years, have utilities increasingly looking to incorporate more storage capacity into their resource planning. In the last month alone, in addition to SRP’s project, there have been four other major storage announcements by utilities in the western United States. In Colorado, Xcel Energy detailed plans for a 275 MW storage project that would come online in 2022 if approved by the state’s Public Utilities Commission.  In Texas, Vista Energy released plans to develop a 10 MW, 42 MWH project which would be the largest in the state.  Nevada’s largest utility announced plans for a possible 100 MW storage project.      

In Arizona, SRP’s storage project will help determine the best way to scaleup larger energy storage projects.  And thanks to the Arizona Corporation Commission’s forward thinking on the state’s energy future, larger storage projects could play a vital role in the state’s energy infrastructure.  Earlier this year ACC Commissioner Andy Tobin proposed an Energy Modernization Plan, which calls for 3,000 MW of storage by 2030. 

The Energy Modernization Plan is a common-sense Arizona based plan.  Beyond calling for investment in storage technologies that help manage electricity demand, which makes the grid more reliable, flexible, and inexpensive, the proposal would, by 2050, have Arizona get 80 percent of its energy from sources like solar, storage, and nuclear. The plan calls for investing in efficiency, which is the least expensive way to meet the state’s energy needs.  The Energy Modernization Plan would ensure that Arizona remains a national leader energy innovation while protecting consumer rates. 

Senators Gardner and Heller Request Tariff Exemption for Utility Scale Solar

Senators Cory Gardner (CO) and Dean Heller (NV) signed onto a letter with six of their Republican Senate colleagues asking the Trump Administration to exclude utility scale solar panels from recent trade actions designed to help U.S. manufacturers against unfair competition from foreign solar panel imports.  The letter sent to U.S. Trade Representative Robert Lighthizer, Secretary Rick Perry and Secretary Wilbur Ross, points out that the President’s directive on the solar tariff allows for exemptions to be made when unintended consequences would result that lower domestic economic growth. 

In this case, the Senators are correctly calling for an exemption of 72 cell, 1500 volt utility scale solar panels because the domestic market is not able to meet the booming demand for these panels.  Utility scale solar projects required more than 10,000 MW of these panels in 2016, however, that same year the U.S. domestic market only produced 550 MW of 72 cell modules.  To further complicate the situation, of these domestically produced 72 cell panels, all were of the 1,000 volt variety for commercial and residential applications which yield a higher margin than the 1,500 volt type that utility scale solar requires.  It’s clear that the U.S. domestic market will not be able to respond fast enough to meet the demand for utility scale modules putting this segment of the industry and the tens of thousands of American jobs associated with it in jeopardy.                                                                                                                                       

Even though these specific solar modules are not manufactured in the United States, the domestic solar supply chain and workforce benefits and relies on the deployment of these panels.  The letter highlights the fact that the President’s directive allows for “benefit[s] or advantage[s] to the long-term competitiveness of the solar manufacturing supply chain” to be taken into consideration when granting a product exclusion.  The Senators conclude their request by arguing that:

The exclusion of 72-cell, 1500 volt solar panels from the safeguard measure will preserve tens of thousands of existing solar manufacturing and development jobs, foster market expansion, and allow the U.S. to once again fairly compete in the global marketplace for energy production technologies.  Sensible product exclusions will uphold the integrity of the safeguard measures intended to facilitate positive adjustment to competition from imports of certain crystalline silicon photovoltaic cells. 

The Western Way supports this common sense request that will save U.S. jobs and increase the economic impact of utility scale solar projects across the West.   

Red States Lead in Energy Production

The American Wind Energy Association recently issued its U.S. Wind Industry Annual Market Report for 2017, and—spoiler alert—the United States is second in both global installed wind power capacity and wind energy generation. Wind now supplies 6.3% of America’s electricity and accounts for 30% of the electricity produced in Iowa, Kansas, Oklahoma, and South Dakota. Wind is also a major player in Nebraska, North Dakota, Wyoming, Idaho, and Texas—all red states—proving that renewables garner bipartisan support. And, why shouldn’t it? More than 500 wind-related manufacturing facilities support 105,000 jobs, and every state has some wind-related facility or project within its borders.

This report should disrupt the perception that renewables are only supported by those that lean to the political left. Wind spans the political spectrum and benefits all Americans by increasing private investment in rural America, providing career opportunities, breathing revenue into state coffers, and promoting national security. That’s probably why wind projects and facilities are present and supported in 75% of Republican congressional districts and 62% of Democratic districts.

The Western Way supports an all-of-the-above energy policy, and wind energy is one of the nation’s most robust resources. It should come as no surprise that the top 5 states leading the U.S. in wind energy production are conservative. We are the party of conservation, and we are proud to support an industry that promotes cheap, reliable, and sustainable energy.