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Roasters Turn Up the Heat on Bob
On Thursday, May 10th our staff, supporters and colleagues came together to commemorate 20 great years of Bob Jenks as the Executive Director of CUB. In an effort to honor his past and toast to the future, special guests were given an opportunity to roast Bob last week at Jam on Hawthorne. Attendees enjoyed a wonderful show full of good laughs and hilarious anecdotes. Some of the highlights included Jill and Macy, Bob’s wife and daughter, talking about Bob through the years and gaining some great laughs, as well as Oregon Public Utility Commissioner Susan Ackerman taking the chance to poke fun at Bob while also complimenting his role in advancing and improving the energy landscape and utility regulation in Oregon. The special event was emceed by CUB’s current board chair Linda Tomassi, Executive Director of Oregon Women Lawyers.
Dave Robertson, the Vice-President of Public Policy for Portland General Electric, really embraced the opportunity to have an open shot at Bob, and his comments were complemented by a presentation that included fictional tweets from Bob as well as hilariously photo-shopped images of Bob. Dave’s remarks ended on a positive and friendly note when he presented Bob with a custom bobble-head of Bob himself.
In addition to Dave Robertson, Macy and Jill, and Susan Ackerman, the line-up of roasters included:
- Laura Etherton – Laura is a health care policy advocate for OSPIRG and has known Bob since before he came to CUB. Her comments included a number of anecdotes from other past colleagues of Bob pre-CUB.
- Kevin Masterson – Kevin currently works at the Oregon Department of Environmental Quality (DEQ). He worked on the initial CUB campaign and served as CUB’s Board Chair from 2003-2006. In addition to the great jokes he provided, he also highlighted Bob’s unique ability to maintain a calm cool and collected voice whether talking about the Blazers or fighting rate increases.
- Rachel Shimshak – Rachel is the Executive Director of the Renewable Northwest Project and has been a key ally for CUB, starting there just a few years after Bob started at CUB.
- Jason Eisdorfer – Jason was recently appointed the Utility Program Director at the Oregon Public Utility Commission. He worked at CUB for nearly 14 years and has countless stories about Bob! He really enjoyed re-surfacing old quotes about the pair working together in the past. For example: “The two are the bearded (and often barefoot) Bob Jenks and his clean-cut cohort Jason Eisdorfer.” -Willamette Week 1998
Bob was given a chance to rebut the remarks and he did so with his usual vigor and quirky sense of humor. The evening concluded with some special remarks from Senator Diane Rosenbaum. She is currently the majority leader in the Oregon State Senate and Bob is one of her constituents. We were grateful to have her honor Bob’s service and CUB’s great work at our event.
Thank you very much to Jam for hosting this great event and providing such delicious appetizers. We look forward to spending the rest of 2012 celebrating Bob’s twenty years! Won’t you join us?
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CUB’s New Schaich Intern
Less than a month ago, I started here at CUB as an Event Planning Intern to assist in the coordination of our second annual policy conference. I was initially drawn to CUB due to its strong history of consumer protection and progressive attitudes for the future of energy use. Sustainable, community-oriented public policy has been as the forefront of my academic and professional pursuits. Since earning a B.A. in Urban and Environmental Policy from Occidental College, I have had a number of jobs focused on policy and community organizing, ranging from affordable housing to international human rights to environmental stewardship. Having grown up just outside of Portland, I am grateful to have the opportunity to contribute first hand to the policies that affect our daily lives throughout Oregon.
I am particularly excited to contribute to this year’s policy conference, which is focused on energy efficiency. Conferences are a great way to bring people together to have the opportunity to learn and gain new perspectives. I thoroughly enjoy the satisfaction in not only putting on a successful event, but being part of the transformation, understanding and relationships that develop as a result. As a leader in energy efficiency policy, Oregon is a dynamic and progressive setting to discuss the future possibilities of this sector. I have high hopes for this year’s conference and I look forward to being part of the great work CUB contributes to Oregon’s residents.
CUB has been fortunate to have a number of great interns over the years. This is due not only to fortune, but also to an endowment, which helps fund one of our internships. The Eric Shaich Memorial Internship Fund was created in 1993 with the objective of providing students with the opportunity to gain skills and experience, while furthering CUB’s mission of ensuring fair utility rates, maintaining a sustainable energy supply, and promoting telecommunications policies which promote civic values. I am honored to be part of such a long tradition of education and service.
NW Natural Claims Customers are Making Homes Too Efficient!?
In previous posts, we have discussed NW Natural’s proposal to raise the monthly customer charge to $29/month.
Last week was CUB’s chance to respond to NW Natural’s proposal. In examining the company’s request, we concluded that the purpose of NW Natural’s proposal seems to be to encourage customers to spend less on conservation. By increasing the portion of your bill that is a monthly fixed charge unaffected by your usage, NW Natural is reducing your incentive to conserve natural gas.
The policy of the Oregon PUC for more than a decade is to limit the monthly charge to the cost of the meter, meter reading, and billing. Other costs, such as the costs of the pipes that deliver the gas and the cost of the gas itself, are recovered in volumetric charges (a ratio of dollars to therms).
According to NW Natural, this policy needs to change, because it is causing customers to spend too much on energy efficiency:
Unfortunately, volumetric rates produce the opposite result of conservation. Volumetric rates encourage the wasteful use of resources to reduce gas use and discourage efficient uses of natural gas. Full cost-based Customer Charges promote efficient use of all resources related to gas consumption and, thus, result in optimal conservation.
Read this statement carefully. What the company is saying is that that we are wasting resources spending them on efficiency because we are achieving conservation above the optimal level.
For NW Natural, the optimal level of conservation is linked to the short-term marginal cost of natural gas, which is at an historic low—the company is paying very low prices for the product it sells to customers, and if customers conserve their natural gas usage, NW Natural sees less profit from its investment.
Of course, a big problem with this is that gas won’t be priced at historically low levels forever. Historically, natural gas prices have followed a boom and bust cycle. Back in the 1980s and 1990s the Oregon PUC allowed energy efficiency investments follow the same boom and bust cycle as short-term energy markets. When prices charged to customers were high, utilities increased them even more to support energy efficiency programs. When prices charged to customers were low, utilities lowered them even more by cutting energy efficiency programs. When the Western energy crisis hit in 2001, Oregon regretted all the cuts that had been made to conservation programs due to short-term prices. The efficiency programs that had been cut would have saved Oregon household tens of millions of dollars.
Since that time, the PUC and utilities have recognized that energy efficiency investments should be tied to the long-term cost of energy. Weatherizing a house is a long-term measure. It will not just save energy at today’s prices, but it will save energy in a decade at whatever prices exist at that time. Energy efficiency has proven to be our cheapest and cleanest source of energy. It is not something we do in the short term to respond to today’s market, but it is something we invest in over the long term to keep our bills down.
CUB filed testimony that countered the NW Natural proposal. CUB quoted Oregon Governor John Kitzhaber who spoke at the Future of Energy Conference this year in Portland. . In his keynote Governor Kitzhaber said,
We know what other regions have yet to learn:
That the cleanest form of energy is the energy we don’t use and that there is tremendous economic potential in significantly scaling up investment in energy efficiency and conservation;
That the real potential of our extraordinary natural assets lies not in their exploitation, but in their restoration; and
That the global market is hungry for technologies, products and services that get things done more efficiently and at a lower cost—the keys to a clean economy.
The utilities should take note.
For more on this case, read the Oregonian’s article on NW Natural’s request to the Oregon Public Utility Commission.
And to stay up to date on this case and the other vital work we’re doing by signing up for our e-newsletter or liking CUB on Facebook! Your membership in CUB—starting at just $5!—is what keeps the fight going. Become a CUB member today!
BPA Wind Curtailment Update
It’s that time of year again—spring! Spring means of a lot of things here in the Northwest—blooming flowers, planting gardens, a little less rain, and (most important to this native Texan) a little more sunshine. Warmer temperatures mean that the snowpack in the Cascades and Rockies is melting. That water makes its way to the streams, rivers, and lakes that ultimately flow into the Federal Columbia River Power System (FCRPS). Combine that with the rain that we already get during the spring and early summer here, and you’ve got a lot of water on your hands. Or rather, the Bonneville Power Administration (BPA), the federal agency charged with selling and delivering the power produced from the FCRPS, has a lot of water on its proverbial hands.
You may recall that around this time last year, CUB blogged about spring runoff and its effect on the wind production in BPA’s service territory in a post entitled Fishing for Wind in High Water. In that post, CUB talked about wind generation during high water periods, the federal power system, and the positions of various stakeholders with regard to solving wind curtailment problems under BPA’s Interim Environmental Redispatch and Negative Pricing Policies. As a quick re-cap, BPA has chosen to “curtail” wind generation when certain periods of low electricity demand (think late night/early morning) coincide with periods of strong winds and high water (think spring/early summer here in the Northwest). This happened during a period last summer and again just this week. Wind curtailment is the result of effort to balance the various interests that BPA must promote (including encouraging development of renewable energy in its service area; providing federal power to certain “preference” customers, including residential customers; and mitigating the effect of the FCRPS on fish and wildlife) during times when there is more power on the grid than the system needs.
Earlier this week (Sunday morning and Monday morning, specifically) marked the first times that BPA has curtailed wind generation this year. As such, CUB thought it was the perfect time to update everyone about what’s been going on with this issue over the past twelve months.
And a lot has happened! In response to BPA’s wind curtailment practices, several stakeholders filed a petition against BPA with the Federal Energy Regulatory Commission (FERC) on June 13, 2011, claiming that BPA could have chosen to sell the excess power to other neighboring utilities at negative prices rather than shutting down wind. “Negative pricing” means that BPA would pay a neighboring utility to ramp down its own generation assets in order to allow the grid to absorb the excess wind and hydro. Letting wind energy make its way to the grid is important to generators so that they can claim certain tax incentives and encourage additional wind development. BPA claimed that it was forced to curtail wind in order to meet environmental regulations for the protection of fish populations, and could not pay negative prices because of market concerns and because shifting costs to BPA’s fish and wildlife programs and ratepayers, rather than to generators who can still profitably operate during times of negative pricing, was unreasonable.
On December 7, 2011, FERC ruled that BPA’s wind curtailment policy was discriminatory in favor of hydropower and required BPA to file tariff revisions that are not unduly discriminatory or preferential within 90 days of the order. In its order, FERC also acknowledged that both sides faced difficulties in this dispute.
In accordance with FERC’s order, BPA filed its new protocol with FERC earlier this year. Unlike last year, BPA’s new interim policy includes a provision that mandates wind energy operators will receive some compensation for the revenue that they would have otherwise gotten had their power made it to the grid. According to BPA, the current policy treats wind energy operators fairly, as they are being made financially whole through the reimbursement provision which is required to include lost revenue from renewable energy production credits.
However, advocates for wind energy are not sold on the policy and continue to engage with BPA about the best policies moving forward. Though they agree that compensation for curtailed wind is an improvement over last year, critics still argue that BPA is not doing all that it can to prevent wind curtailment.
With wind curtailments starting even earlier this year, it will certainly be interesting to see what happens over the next few months. Though CUB takes no position on this contentious issue, we will certainly continue to monitor the situation and keep you updated.
Looking into the Future of Energy
Last week I had the pleasure of attending once again the Future Energy Conference, one of two conferences held annual here in Portland and up in Seattle. The conference is a wonderful opportunity to bring together folks from all aspects of the energy sector, discussing policy, business, and sharing insights.
At last year’s conference, Governor John Kitzhaber announced his vision of a 10-year energy plan, and this year he followed up on that announcement during his lunchtime keynote on Wednesday. The Governor also spoke about his concerns regarding the proposed coal export terminals sited here in Oregon, and his commitment to a sustainable economic and energy future for Oregon and its citizens.
One of CUB’s key interests is in energy efficiency (a topic we’ll be focusing on this year), notable because Oregon is a leader in energy efficiency policy—after all, our very own Energy Trust of Oregon is celebrating its first decade of service this year! I was particularly interested in the panel Alternative Models for Promoting Efficiency, which brought out some new data about behavior-related energy efficiency programs and ways to evaluate those programs. From the residential to the commercial scale, there is exciting work being done to bring more of the market into energy efficiency.
Thursday featured one of my personal favorite topics—electric vehicles. As our very own Emmaline Pohnl shares with us (check out her recent blog posts on EVs, Are Electric Vehicles Truly Cleaner? and What’s “App-ening”: Phone and Web Applications for Electric Vehicle Owners Looking to Re-Charge), there is a great deal of forward momentum in the development of Electric Vehicles here in Oregon. The first panel , Electric Vehicles – Status & Trends, brought attendees up to date on the many projects related to EVs in our state; and the following panel, Electric Vehicles – Fleets Leading the Way, did a great job of focusing in on a vital part of Electric Vehicle adoption. Fleets, whether they’re motor pool sedans, law enforcement motorbikes, or hybrid trucks of many different stripes, can have a huge impact on the overall carbon emissions profile of the transportation sector and help bring visibility to the power of Electric Vehicles.
During lunch on Thursday, renewable energy analyst Paul Gipe gave a fun presentation about the many different stories of community renewable projects taking place all over the world. From Canada to Germany and beyond, his examples of how leaders brought together their communities to adopt small to medium scale renewable projects was inspiring.
Later that afternoon, the American Council for an Energy-Efficient Economy (or ACEEE)‘s executive director Steven Nadel presented some trends and key development of energy efficiency programs throughout the nation. While I think many of us are well-versed in (and very proud of!) the success of energy efficiency programs and conservation that takes place here in Oregon, it’s very helpful to contextualize our experience against that of other states, and the nation as a whole.
The Future Energy conference is a great event that draws some fascinating minds and ideas together to discuss the important issues facing our energy future here in Oregon, the region, and the United States. Two days of discourse is never enough, but some good ideas were presented at this year’s conference. I look forward to taking part in next year’s program!
House Parties with CUB!
As CUB’s Board of Governors’ Chair, I’m delighted to announce that CUB has renewed its tradition of hosting house parties to reach out to neighborhoods and communities throughout Oregon, building on our membership through personal and professional relationships.
I knew things were going well at my first house party for CUB in SE Portland when the house was full of animated conversation and everyone ended up in the kitchen. Co-hosting a house party to raise awareness about the work CUB does for ratepayers and the environment was fulfilling and fun. It combined my passion for the work CUB does to make the world a better place with the joy of entertaining and meeting new people. My co-hosts, CUB officers Kelly Cowan and Dan Jaynes and CUB Organizing Director Jeff Bissonnette, brought together the familiar and unacquainted to learn about CUB, and why membership in our organization is important for Oregon’s energy and environmental future.
While the beautiful weather might have kept a few people playing outside, those who attended did so enthusiastically. Some attendees worked in the energy field and so were familiar with CUB,, while others learned for the first time about what our organization does and why we exist. Many left as new members and fans of our work.
Becoming a fan of CUB’s work is easy. Just spend five minutes listening to CUB Executive Director, Bob Jenks, discuss how he takes the CUB’s mission and Oregon’s values around climate change into economic discussions with utilities about coal plants. Spend ten minutes and you might be a fan for life. Having served as CUB’s Executive Director for twenty years, Bob is known nationally for his remarkable analytic skills and his consumer and environmental protection heart. He knows how to take the complexities of CUB’s work and connect with his audience through compelling stories and humor. Showcasing the work we do through his anecdotes is a key way CUB hopes to continue building its relationship with community members and bring more Oregonians into the CUB family.
When it’s my turn to host another house party, I will gladly volunteer with bells on—and you’re invited to do the same! If you’re interested in hosting a house party with CUB to showcase the great work we do and raise awareness within your community, please contact us! Give us a call at 503-227-1984 or use our contact form and we’d love to talk with you about it.
This house party was just the first of many, and I was thrilled by its success. Won’t you join us in celebrating Bob’s twenty years of work with CUB by attending our Roast of Bob on May 10th at JAM in Southeast Portland? We’d love to see you there!
And to keep up to date with everything going on here at CUB—we keep it busy around here!—please sign up for our e-newsletter and like us on Facebook. You, and members just like you, are the reason we’ve been so successful over the last three decades.
Are Electric Vehicles Truly Cleaner?
CLIMATE IMPACT
A report released by the Union of Concerned Scientists puts to rest a question that has been dogging the electric vehicle industry and causing consumers to doubt the environmental benefits of electrical vehicles (EVs): are the greenhouse gas emissions of an EV actually lower than a conventional car using gasoline fuel? This question stems from the concern that because electric vehicles are plugging in to our nation’s electrical grid to charge and, on average, 45% of the electricity on our nation’s grid comes from coal power plants; they are being fueled by “dirty power”. After thorough analysis using the most recent data, the UCS report definitively answers that important question: “There are no areas of the country where electric vehicles have higher global warming emissions than the average new gasoline vehicle.”
Two realities contribute to this exciting finding. First, due to stronger regulations and higher anticipated standards on greenhouse gas emissions from power plants, utilities are cleaning up their acts. Power producers are increasing emissions controls on their plants and gradually moving away from coal and toward cleaner sources of energy, such as natural gas and renewable resources. Secondly, the average new gasoline vehicle has relatively low fuel efficiency (compared to hybrids and very efficient models that can get up to 50 MPG), achieving 27 miles per gallon.
REGIONAL VARIATION
The greenhouse gas emissions of an EV, however, can be considerably lower in one part of the country than another, depending upon the mix of energy generation used in different regions. The UCS report finds that, here in the Northwest, our grid mix has a low carbon intensity because of our region’s reliance upon hydropower and increasing use of wind and other renewable energy sources. As a result, an EV charged on the Northwest’s power grid will have a very low carbon footprint—to match the lower emissions of an EV in Portland, for instance, a conventional gasoline vehicle would have to achieve a fuel efficiency rating of 73 miles per gallon! In comparison to the 26 regions analyzed in the report, the Northwest comes in as 5th in the nation in terms of low carbon intensity for electricity.
In areas of the country where coal comprises a slightly higher portion of energy generation, such as most of Texas and the Appalachian region, an EV would still emit fewer greenhouse gas emissions than the average new gasoline vehicles, which get 27 MPG. In this scenario, an EV’s emissions would resemble those of the best gasoline hybrid vehicles available, which achieve 41-50 MPG.
If an EV is being charged in the Midwest or just east of the Rocky Mountains, where a large portion of energy on the grid is generated from coal, its emissions profile would still be better than that of the new average gasoline model. For example, in Michigan, 70% of electricity comes from coal power. Even on that “dirty” power, an electric vehicle would have greenhouse emissions equivalent to those of a gasoline-fueled vehicle with a fuel economy rating of 38 MPG—higher than the average of a new car (27 MPG) and the average of the entire nation’s midsize fleet currently in use (25 MPG).
UCS concludes that nearly half of Americans (45%) live in regions where an EV would have fewer emissions than the highest performing gasoline hybrids on the market that can achieve 50 MPG. As highlighted previously, the Northwest is one of these regions due to the large percentage of low-carbon energy resources.
COST
In addition to examining the greenhouse gas emissions of EVs in different regions of the United States, UCS also explores the typical savings a consumer could achieve with a gasoline-free vehicle. EVs are currently more expensive to purchase than conventional gasoline vehicles and, although prices are expected to drop as battery technology improves and production scales up, this initial cost is a large barrier to consumer adoption. The report addresses that barrier by taking the long view: how much would an EV owner save in fuel costs in comparison to a gasoline vehicle owner, over the vehicle’s lifetime?
The results are startling: the owner of a typical midsize EV could save nearly $13,000 in fuel costs over the lifetime of the car, spending approximately $5,200 to charge it. Over that same timeframe, the owner of a compact vehicle that achieves 27 MPG—the average fuel economy in the US— will need to spend over $18,000 to purchase over 6,000 gallons of gas. These calculations assume the lifetime of the vehicle is 15 years and that the annual mileage traveled starts at 15,000 and declines 4.5% a year.
POLICY/ADVOCACY NOTE
From an environmental and economic perspective, electric vehicles are the best alternative to replace the greenhouse gas-emitting and gasoline-guzzling vehicles that are responsible for 20% of Oregon’s greenhouse gas emissions and send over $6 billion annually overseas to oil-producing countries. Yet, the UCS report emphasizes the exact same messages CUB does: to fully maximize the potential of electric vehicles, policies must lower barriers to EV ownership and create incentives and infrastructure that connect renewable energy to EV charging. By taking these steps in Oregon we can ensure our state remains a leader in clean technology and renewable energy and on track towards a sustainable energy future.
To keep up to date on CUB’s Electric Vehicle program and more, follow our Facebook page and sign up for our e-newsletter. To learn more information about our EV program, click here
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Clean Energy Worked on My House
Last fall, I wrote about how I had signed up for an energy retrofit of my house through Clean Energy Works Oregon. Clean Energy Works is a non-profit that allows utility customers to do home energy efficiency upgrades and pay for the upgrades through a charge on their utility bills. In that earlier post, I described the program and what made it attractive to me. Let me start with the advantages to the Clean Energy Works program:
The first is one-stop shopping. You can sign up for the program and Clean Energy Works arranges the various contractors, so you don’t have to contact furnace installers, insulation installers, and window installers separately. A lead contractor will assemble the team to complete the work on your house.
The second is the ability of Clean Energy Works to bring Energy Trust of Oregon incentives on certain measures together with federal stimulus money to reduce the cost of the energy efficiency upgrades. You don’t have to pay for the retrofit up front, apply for incentives, and then wait for them; the incentives are instead provided up front as a discount on the overall cost of the project.
The third is the ability of Clean Energy Works to include some items that are not directly related to energy efficiency. For example, in our home we added a bathroom fan and carbon monoxide detectors. Before the upgrade, our house was drafty. Now with it sealed up tight, we need to be able to get moisture out and we need the CO detectors.
The final advantage of Clean Energy Works is that it is tied to a loan that is then paid back on your heating bill over the next 20 years. The interest rate is 5% and early payback or refinancing is allowed.
What We Did
My wife and I decided to do a deep retrofit to our 80 year old home. This included having shingles taken off the outside of our home so insulation could be blown in. Additional insulation was also installed in the attic. Our house had been quite drafty and we had it sealed up pretty tight. The final tests showed an amazing improvement in eliminating air leakage. We replaced the natural gas furnace, which was installed in the 1970s,and converted our hot water to gas and installed a tankless water heater. This last step was expensive, and there are lower cost alternatives—natural gas water heaters with tanks that are nearly as cost effective, for example. On the other hand, my family tends to use a good deal of hot water. I personally find the shower a great place to think about my upcoming day, so if I am going to use extra hot water, I should make my hot water system as efficient as possible.
It is important to note that we did not have to go so deep and do as much as we did. We could have had a less expensive upgrade. By doing less, we could have tried to more closely match the reduction in our utility bills with the cost of the loan. But we felt this was a good opportunity to invest in our home, recognizing that we would get not just lower bills but greater comfort, and we would also reduce the carbon footprint of our home. In addition, as energy costs rise, the value of the savings will increase. Our house went 80 years without any insulation in its walls, but will now always be insulated.
The energy audit suggested that we would see energy savings of greater than 30%, which we knew would not fully cover the loan, but would still offset a significant portion of it.
The Results
Wonderful.
The comfort level in our retrofitted home is amazing. The house is no longer drafty. The temperature is consistent from room to room. It really is an amazing difference and is much greater than I had expected. We expect that this improvement will also follow us into the summer. With good insulation and a well-sealed house, we should be able to cool the house at night and in the morning with windows and fans, and close up the house during the day to maintain a comfortable temperature.
The second benefit, which I was not even expecting, is in air quality. The new furnace comes with a significantly better filter, and a gentler fan (at least on its low setting which is normally all that is required to warm the house). My dust allergies that rise up in the winter heating season disappeared this year.
Finally, after several months of bills, we can conclude that the promised savings is there. In March, for example, my electric bill is down 47.5% and my gas bill is down by 32%. The total bill savings was a little over $100, while the cost of the loan on the measures was about $20 greater than the bill savings. The savings has varied each month. When tracking bill savings, it is important to recognize changes in weather, changes in the number of days in the billing cycle, and our home usage. In December, our savings was only 21% on electricity and 24% on gas. But last year we went to visit my wife’s family over the holidays, so we had lower than normal usage. After making adjustments of weather, billing days, and occupancy, my best estimate is that my electric bill has declined by about 40% and my gas bill by about 30%, and that covers about 80% of the cost of the loan.
As electric and gas prices increase, the savings will grow, but the loan amount will not. In the long run this investment is cost effective and will save us money. In the short term, we are paying a little more each month, but our comfort and quality of life have improved.
I was quite surprised that the electric bill went down so much. The primary driver of this is the conversion of water heating to gas. However, having a more efficient electric fan in the new furnace contributes, and the new system has reduced the need to occasionally use an electric space heater upstairs, where there is only one heating vent. Finally, I note that the effort and investment have also reminded my family of the value of conservation and I am less likely to find lights and televisions left on in rooms that are empty.
The Disclaimer
We are very happy in our retrofitted home. It was well worth doing and the results have been better than we expected. At the same time, this was a significant endeavor. We had contractors working inside and outside of our house for several weeks. My lead contractor was great. His commitment to air sealing my house and eliminating leaks was extremely strong.
But a different house with different contractors will likely get a different result.
CUB Applauds Coal Shut Down, Demands Better Analysis of Coal Investment
A couple of years ago, PGE was planning to invest $500 million in its Boardman coal plant. CUB challenged PGE to consider phasing the plant out instead of making the planned investments, and requested that PGE complete an analysis of a phase-out. PGE did the analysis and concluded that customers could save $200 million with a phase-out of the Boardman coal plant. (See Boardman Closure Update from last year.)
Since that time, CUB has been working to get Oregon’s other two electric utilities, both of which have significant coal resources, to conduct similar studies before making investments in their aging coal plants. We talked about this last year in “PacifiCorp Is Starting to Get the Message On Coal.” This past week showed that we are making some progress with PacifiCorp—but we’re not having much success (yet) with Idaho Power.
PacifiCorp
In a filing last week, Pacific Power announced its intention to stop burning coal at the Naughton 3 coal plant, saying that its analysis shows that it is cheaper to stop burning coal instead of investing millions in new pollution control equipment. CUB has been pushing PacifiCorp to do a comprehensive study of the Naughton 3 coal plant, because its plans required significant investments in pollution control to be made over the next few years.
The new analysis of Naughton 3 conducted by PacifiCorp states that it would be cheaper to stop burning coal and instead covert the plant to natural gas. Because burning gas in a former coal plant is not as efficient as a new natural gas combustion turbine, this repowered plant would operate primarily to serve summer peak load in Utah and Wyoming. PacifiCorp says that it does not need the plant the rest of the year. This change in position by PacifiCorp shows that recent investments in wind generation and energy efficiency are reducing the need for large baseload power plants that run 24/7.
PacifiCorp deserves credit for its recent decision. The company has spent years fighting against attempts to close coal facilities. And in recent years, it has invested more than 1 billion dollars in its coal fleet without first studying whether this was the best decision economically. But this time PacifiCorp did the study we requested before making new investments, and now it is proposing to stop burning coal at this plant. This is a significant switch for the company, and we applaud the decision.
Idaho Power
On the other hand, Idaho Power is moving forward with clean air investments in its coal fleet without looking at alternatives. CUB filed testimony this week asking the PUC to find Idaho Power imprudent for not doing the type of analysis that PacifiCorp has now done on Naughton 3, and that PGE did on Boardman. We also requested that the PUC disallow Idaho Power’s request to charge its Oregon customers for the costs of the clean air investments that were not properly analyzed.
Idaho Power and PacifiCorp are both part-owners of the Jim Bridger 3 coal unit. Jim Bridger 3 is in the process of upgrading its pollution control technology as part of the Clean Air Act’s Regional Haze Rules. These are the same rules that created the need to invest millions in PGE’s Boardman coal plant. Because Idaho Power is also a minority owner of Boardman, the need and potential outcome of such a study should not come as a surprise to the company. Since the same rules caused PacifiCorp to change its position on Naughton 3, it is not surprising that PacifiCorp’s recent testimony related to Naughton 3 also referenced the need to review Bridger 3.
At issue in the current Idaho Power rate case is the incremental investment associated with a single year at Bridger 3—a relatively small sum of money. More important, as CUB pointed out in its testimony, is a review of the entire proposed clean air investment scheduled to take place in the coming years. The question that needs to be asked is whether it is cost effective to invest in the Jim Bridger 3 plant at all, or should the company be considering retirement of the plant, as was done with Boardman, or repowering of the plant as a natural gas plant as is being suggested for Naughton 3.
One additional troubling issue related to the Idaho Power docket is that the Staff of the Oregon Public Utility Commission filed testimony supporting Idaho Power’s investment in the coal plant. The PUC Staff seems happy to evaluate each year’s incremental investment separately, without ever considering the total multi-year investment cost required to meet the federal requirements. Under the PUC Staff’s approach, both Boardman and Naughton 3 would have continued to burn coal. We would never have discovered that it will save customers huge amounts of money to phase out coal burning at these facilities.
An interesting footnote—I found out about the PacifiCorp Naughton 3 decision while attending the Western Clean Energy Advocates Conference in San Francisco. I had been invited to the conference to discuss Boardman as a case study in how utilities can save customers money by avoiding investments in coal plants. By the time I actually stood up to speak there were two case studies for me to point to! We thank WCEA for my invitation to speak about this work.
Tracking Your Way to Energy Savings
Many utilities across the country, including a few in Oregon, have finished installing new smart meters on customer homes and businesses within their respective service territories. For those of you who may not know, smart meters allow for two-way communication between the meter and the utility through a secure network. This means that if you’re a customer of a utility that’s utilizing smart meters, your meter is read every few minutes rather than once a month (or longer) as with the previous analog meters.
Why should we care? Well, some utilities and other organizations are doing something really cool with the information received from the smart meters: helping customers to be aware of their energy usage and identifying opportunities to improve each residence’s energy efficiency. This is great because it can help to save customers money, which is something that CUB always favors!
PGE’s Energy Tracker Tool: PGE’s new “Energy Tracker” tool is now available for PGE customers once they log-in to their account online. Much like many of the other tools you’ll read about below, it’s important to take the time to update your profile, which includes answering specific questions about your home (including its size, appliances, heating and cooling fuel sources, etc.) in order to get the most accurate information for how your home uses electricity. Once the user has entered information about their home, there are three general parts to the Energy Tracker tool: “Your energy use,” “Ways to save,” and “Analyze your bill.” The “Your energy use” function provides customers with detailed information about their own energy usage, including hourly, daily, weekly, and monthly usage data. Once you’ve updated your profile, the “Ways to save” function can also use customer-specific information to help customers identify ways to save based on their desired level of involvement, which can range from one simple change to extensive energy efficiency improvements. The “Analyze your bill” function may help customers to understand changes in their PGE bills. “Analyze Your Bill” helps customers to compare their usage to other time periods and highlights changes that may have caused either the increase or decrease in electric bills from previous months. Once Energy Tracker has accumulated a year’s worth of data for your home, you will also be able to compare a particular month to the same month in the previous year.
CUB Illinois’ CUB Energy Saver: Not to be confused with your very own Oregon CUB, Illinois CUB (an organization much like yours truly that serves ratepayers in Illinois) has developed its very own energy tracking tool called “CUB Energy Saver.” CUB Energy Tracker first asks the user to provide their ComEd account number, which allows the tool to sync the consumer’s energy usage online—can’t get much easier than that! Once the usage information is uploaded, the user can then enter information about their home to learn more about how his or her home uses electricity. The tool also allows the user to explore ways to save that range from no-cost improvements to significant home investments in energy efficiency measures. The tool also allows users to track their progress and shows estimated dollars saved. But one of the coolest aspects to the tool (in my opinion) is the “Rewards” feature, which rewards users for energy that they save—for every kWh saved, CUB Illinois gives the user 2 rewards points that can be used to redeem all kinds of discounts at various local and national businesses. Not only can you save money on your monthly bill, you can actually earn extra perks! Not too shabby.
Idaho Power’s Home Energy Yardstick: Idaho Power’s “Home Energy Yardstick” is a tool to help Idaho Power’s customers conserve energy and save money. As an initial measure, Idaho Power customers should answer the Home Profile question, which then provides energy saving ideas that may work to save the user money, if implemented. Once those questions are answered, the user can then enter his or her account information into the Home Energy Yardstick tool, which provides a breakdown of that user’s specific usage information that Idaho Power gathers from that user’s smart meter. There are graphs and charts to allow users to see their daily kWh usage, which can then be compared to previous months. Users can also see the average usage of their home and compare it to similar homes in their area. The tool also contains tons of tips and tricks that can save consumers energy by promoting energy efficiency.
Opower’s Home Energy Reports and Online Tools: Opower is a company that works with utilities to provide tools that help customers of participating utilities track their energy usage and save money. Opower’s “Home Energy Advisor” tool to get recommendations for energy efficiency measures for typical homes in their areas.
All in all, energy tracking tools are a great way to be aware of energy usage and help to identify ways to conserve. CUB encourages those who have access to energy tracking tools to give them a try. Remember, the tool is only as good as you make it, so be sure to update your profile and look for trends in your usage and tips that may help you to save money. Happy tracking!
CUB Springs Forward
As spring starts to reappear here in Oregon, CUB is on the move! We’re excited to be involved in a number of programs and conferences over the next couple of months, and hope to see some of you folks there.
This week, CUB Executive Director Bob Jenks is attending and presenting at the Western Clean Energy Advocates conference in San Francisco. Much like his presentation at PIELC, Bob will talk about the need to transition away from coal-fired power generation in the west and what CUB and our colleagues are doing to support that work.
CUB is proud to be a partner with the Portland side of the Future Energy conference, an annual event devoted to connecting energy policy with energy practice. We’ll be in attendance and are looking forward to hearing the many panelists and keynotes talk about the energy sector.
We’re also partnering with a number of Oregon organizations to support the Living Future program in May. Living Future bring folks from all over the nation together to talk about green building and working towards our sustainable future. It’s an exciting local program with a national perspective.
CUB has recently joined the national organization Smart Grid Consumer Collaborative, a non-profit that brings together many partners in the energy industry together to conduct research and collaborate on the Smart Grid. As you may recall, last year CUB and the University of Oregon Law School held our first annual policy conference on the Smart Grid. The developing Smart Grid is an essential topic for the energy industry, and CUB is staying involved and up-to-date on policies and issues as they impact Oregon’s customers.
We’re also conducting more CUB Connects workshops in April. The first workshops were a lot of fun, and it was wonderful to see folks come out and take control over their telecommunications knowledge. We hope to do more programs like this in the future, and you’re invited! We’ll be at the Woodstock Library in Portland on April 11th, and the St. Johns Library on April 15th. For more information, click here or contact .(JavaScript must be enabled to view this email address).
Later this year, CUB’s Bob Jenks will be attending the mid-year NASUCA meeting. The National Association of State Utility Consumer Advocates—that’s why we call it NASUCA!—is an organization that brings together folks who do the advocacy work CUB does, both in state governments and in non-profits. NASUCA members discuss the key issues we’re all facing and how we’re responding to them. Our long-time membership in NASUCA has been a valuable way to exchange ideas and lessons learned as we all work towards a sustainable, affordable energy future.
Finally, CUB is excited to announce that we’re hiring an Economic Analyst. This new position will help us develop critical research and analysis related to our Transition from Coal project and other related issues. For more information, please click here. This position will be open to submissions until May 6th, 2012.
As you can see, we’re keeping busy here as your local consumer advocate. We’ll have even more great news soon, especially about our top notch Electric Vehicles project and our celebration of Bob Jenks’ 20 years with CUB. We hope to see you throughout the year as we reach out into the community, continue to learn more about energy and the environment, and celebrate so many successful years of advocacy and policy development here at CUB.
To keep up to date on all these events and more, follow our Facebook page and sign up for our e-newsletter. And consider becoming a CUB member—this year marks two decades of service from CUB’s Bob Jenks, and by becoming a member you contribute directly to the work Bob and CUB do as an advocate for Oregon citizens just like you.
Reflecting on the Consumer Movement
I recently visited our nation’s capital for the annual consumer assembly of the Consumer Federation of America. The weather was beautiful, the cherry blossoms were emerging, and national leaders on consumer issues gathered in a hotel basement to discuss the most pressing issues that consumers, advocates, and policymakers are facing.
March 13th, the second day of the conference, marked the 50th Anniversary of John F. Kennedy’s Consumer Bill of Rights . This was landmark ruling that brought the consumer movement to the forefront of the public discourse and paved the way for advocates and policymakers to defend the average consumer by protecting their health and safety through policy, regulatory, and legal battles. Jim Guest, the President and CEO of Consumer Reports , honored the 50th Anniversary of President Kennedy’s declaration of consumer rights with a powerful speech about the history of the consumer movement, the vision that President Kennedy displayed and that all consumer advocates maintain, and a call to continue the fight to protect consumers.
Something that struck me is that the term “consumer” doesn’t have a very positive connotation for the millennium generation. We hear consumer and we think of America’s obsession with consumption that some say has led to the destruction of our environment and the growing power of corporations. We hear consumer protection and we wonder why you’d protect something that exemplifies the exploitation of our natural environment and our culture’s obsession with “stuff”. As long-time consumer advocates, we need to be thinking about how to effectively communicate the ideas that our work is built on, and bring younger generations into an understanding of the rights and protections they have.
A number of the panel discussions and presentations at the conference focused on consumer advocacy in the digital age. How do we regulate technology industries that are constantly changing, expanding, and growing? How do we protect consumer privacy and information when there are so many intangibles? The internet is not something that we can touch and feel, the sharing of information increasingly happens on remote servers and things now communicate with other things without people even having to play a role. how can the consumer movement adapt to this and continue to protect consumers rights? This advancement of technology and the internet is referred to as the “internet of things” – most basically described as the ability of products to communicate with each other, share data, and influence our environment without human influence.
The digital world presents an important opportunity to engage the younger generation in the fight to protect consumer rights. The right to privacy and the right to decide how your information is being shared and used are both prevalent in our daily digital lives. As the internet becomes more essential for school, work, community, leisure, and overall communications, the need to protect consumers is increasingly strong.
Here at CUB, we’re taking these ideas to heart. As we develop policy around the Smart Grid, and continue to work with Oregonians just like you to keep rates fair, affordable, and clean, we’re mindful of the choices that customers will be making in the near future. Being thoughtful about the integration of the “internet of things” and our energy use is key to making sure your rights are protected while we work towards Oregon’s clean energy future.
To stay up-to-date on all of CUB’s exciting news, sign up for our e-newsletter or follow us on Facebook!
What’s “App-ening”: Phone and Web Applications for Electric Vehicle Owners Looking to Re-Charge
With nearly a million smart phone applications out there, there is an “app” (and probably several versions of it) for everything you can imagine. Need help managing your time? There’s an app for that. Want something fun to do on the bus ride to work? Try out a game app. Tired of forgetting what to get at the grocery store? Get a shopping list app. This app craze has been embraced by the electric vehicle community as well, with charging station manufacturers and software developers creating useful online or mobile tools to support the growing deployment of electric vehicles.
Because of limitations in current battery technology, electric cars can store enough power to travel approximately 60-100 miles and must then be “re-fueled” by plugging into a charging station. For most drivers, most of the time, this range is more than enough. Here in Oregon, the average driver travels just 14.1 miles per day. For longer trips, though, electric vehicle owners need to be able to re-charge as they need to. To meet this demand, new companies are building networks of charging stations that are available for the public to use for a fee. Some private businesses are also installing charging stations that are available for public use as way to demonstrate their dedication to a clean energy future. But how are owners of electric vehicle owners going to learn about the location of these stations and see if an individual charging station is free to be used?
This is where online and mobile applications provide a powerful solution. Offering users maps, directions, notifications, and other tools, these applications enable electric vehicle owners to plan their long-distance trips with ease. There are two main categories of electric vehicle charging maps: some are network-specific, managed by commercial charging network companies and only show charging stations built and operated by that specific company. Others are community-generated, designed by app developers and kept up-to-date by the developer and, in some cases, app users themselves. Below are descriptions of some of these applications and details on how to download them.
Community-Generated Applications
Recargo
Launched in 2010,
Recargo helps users find the nearest charging stations and see the availability of stations in their area. Recargo displays both charging stations in commercial charging networks and those operated by individual businesses or organizations. Through Google Maps, users are provided directions and the estimated distance and time to the charging station they select. It also has a nifty filter feature, which enables users to personalize their search by either charge network or plug type. As an added bonus, the app streams updates from PluginCars.com, a website that tracks electric vehicle developments. Recargo encourages users and installers of stations to submit the address and types of chargers at new sites and rate chargers they have used, in order keep the app up-to-date and relevant. It also mimics the popular social media site Facebook by having a live “News Feed” that announces updates to the app’s database and shows when users “check-in” to a charging station.
Compatible with: iPhone, iPads, and iPod Touch; Android; online
Available at: Online, Apple’s App Store, Android Market
Cost: Free
PlugShare
PlugShare’s map displays charging stations in commercial charging networks, individually operated stations, and—as its name suggests—privately-owned charging stations that homeowners are offering to share for public use. To access information on these privately owned charging stations, users must create a log-in and can contact the homeowner via email. Similar to Recargo, an activity feed cues the user into what other app users have been doing and where they have “checked-in” to charge. Users are encouraged to rate a station after charging their vehicle, provide edits to the station’s description, and add new stations that are not listed on the map.
My favorite charging location: Brent in Saskatoon, Saskatchwan, Canada offers up his home charging unit if you are in need of a charge!
Compatible with: iPhones and Androids; online
Available at: Online; Apple’s App Store, Android Market
Cost: Free
Network-specific Applications
ChargePoint
This free app provides the location and availability of charging stations in Chargepoint, a nation-wide charging stations network that is managed by Couluomb Technologies, a manufacturer of charging stations. In addition to showing users where the closest Chargepoint station is to them and giving directions to get there, the app also enables users to make reservations at charging stations, start and stop charging sessions, monitor the progress of their charging, and be alerted when their vehicle is fully charged. To use one of these stations, an electric vehicle owner can become a member of the ChargePoint network (paying a subscription fee) or use a contactless credit card to pay for the charge. Over 5,000 sites are managed included in the network and 800 organizations use ChargePoint to manage their station.
Compatible with: iPhone, Android, and Blackberry; online
Available at: Chargepoint‘s website; Apple’s App Store, Android Market
Cost: Free
Blink Mobile
This app displays a map of vehicle chargers operated by Blink, a nationwide charging station network, and enables users to view the status of each charging site. Similar to the ChargePoint app, users can monitor the status of their vehicles’ charging and receive notifications on its progress; these updates can be delivered by text message or email. To use the stations, electric vehicle owners can either become members of the Blink network or be a “guest”, paying as they charge. Blink network offers charging at 542 locations across the US, with a total of 1,278 charging stations. Here in Oregon, Blinks hosts just over 200 charging stations, in Portland and Eugene.
Compatible with: iPhone, iPad, iPod Touch, or Android Smartphones/Tablets; online
Available at: Blink Mobile’s website; Apple’s App Store, Android Market
Cost: Free
These are just a few of the applications available and more are in development. One exciting app to watch for is Chargemap, a web and smart phone app that displays charging stations near the user’s location on a colorful, easy-to-navigate map interface. It currently is only available in France, Germany, Spain, and the Netherlands (listing over 4,000 charging stations among those four countries), but will soon be released in the United States.
Keep checking our blog for more news and information on electric vehicles here in Oregon. And click here for a description of CUB’s work on EVs! To stay up to date on our work, please sign up for our e-newsletter, follow us on Twitter, and like us on Facebook!
CUB and Environmental Allies Speak Out about Electric Vehicle Policy
Today the Portland Tribune published an opinion piece written by CUB and several of our environmental partners. In the piece, Oregon’s Renewable Energy Guides State to Prosperity: Policies Plug into Electric Vehicle Future, we emphasize the importance of creating intelligent policies on electric vehicles, in order to maximize the environmental benefits of this exciting technology and address consumers’ concerns and needs. We broadly describe several key policies, supporting renewable energy integration and consumer interests, and emphasize the need for public engagement.
As an AmeriCorps member, I have been working on education and outreach around electric vehicles with a focus on engaging public interest stakeholders. It was an honor to see the groups that I have been working with present a strong case for the thoughtful deployment of electric vehicles in our state, and to see that vision published in the Tribune.
Click here to read the opinion piece and learn more about the actions we must take as a state to create a truly sustainable transportation system here in Oregon. If you have any comments or questions, email us at .(JavaScript must be enabled to view this email address)—we value your feedback.
To stay up-to-date on our work around electric vehicles, sign up for our e-newsletter or follow us on Facebook!
Powering Our Future by Engaging Our Students
Over the last three weeks I’ve had the amazing opportunity to speak with students at the McLoughlin and Alki Middle Schools in Vancouver, Washington. In partnership with the youth mentoring organization nConnect, I headed north of our Oregon border to talk about renewable power, energy efficiency, and the Smart Grid with some smart and engaged middle schoolers.
nConnect’s mission is to enhance the learning experience of students and inspire their interest and achievement in the STEM fields (science, technology, engineering, and mathematics). The middle schoolers I visited were exploring energy and its role in our lives as part of their course curriculum. Through my presentation, I shared with the students a close-up look at renewable energy and “smart” technology, with a specific focus on how these can impact our overall energy consumption here in the Northwest. Through experiments, lectures, and presentations like the one I gave, they come to understand the difference between fossil fuels and renewable power and the way conservation and energy efficiency can be a benefit to our region.
It was fun to get back to basics and explain the difference between finite power generation resources and the different kinds of renewable power that can be brought onto the electrical grid to help replace those retiring resources. I was very impressed when several students could explain the difference between solar thermal and solar photovoltaic better than I could! And I got a lot of interest in Tillamook County’s MEAD project—biomass related to cow poop is a big draw for the twelve to thirteen set.
We also talked about the different ways households can embrace conservation efforts, and the students all had great suggestions for basic energy efficiency measures—from replacing the lights in a home or school with compact fluorescent light bulbs to putting new insulation into buildings. The students at McLoughlin and Alki really understood what we need to do as individuals and in the community to work towards a more sustainable energy future.
For a generation of people who are growing up with smart phones and the internet as part of their everyday lives, our discussion about the Smart Grid was a no-brainer! I think many of them were surprised that our electrical grid wasn’t already smart. Electric vehicles were also a hot topic of discussion—it was exciting to see the level of understanding and interest in EVs, even in kids who are several years away from getting behind the wheel.
I want to thank Cyndy Hagin and Rob Potestio for welcoming me into their classrooms and Brittany Stebbins from nConnect for arranging this opportunity. CUB has been working for consumers—regardless of how old they are!—for almost thirty years, and it’s a real honor to be able to share our knowledge with the generation that will power our future.
CUB’s Week in Eugene
This past weekend, SA, Bob, and I had the pleasure of spending a few days in the great city of Eugene to partake in the Public Interest Environmental Law Conference (PIELC). PIELC is an annual gathering for environmental activists, attorneys, students, scientists, and community members to share their expertise and insight about all things environmental (including lots of panels on energy and climate change, both of which are near and dear to CUB’s heart!).
We kicked off the weekend on Thursday night with a Meet and Greet as part of Bob’s 20th year celebration. It’s not often that CUB gets a chance to hold events in Eugene, and we were very fortunate to have the help of our two Eugene-area Board Members, Scott Hansen and Sarah Peters, in making the night a success. It was an intimate event, which really gave folks a chance to talk to Bob one-on-one about CUB’s past 20 years and some of our current work and projects. We generated a lot of enthusiasm and recruited some new members to boot!
On Friday, the PIELC fun began in earnest. We got our table set up and SA and I spent the remainder of Friday, Saturday, and Sunday alternating between panels and tabling, which gave us both a chance to learn lots of new stuff and to get the word out about CUB all at the same time. Because attendees come from all over the United States as well as several other countries, several folks had never heard about CUB. It was a lot of fun telling people all about the work that we do and the accomplishments that we’ve made over the past 28 years.
On Saturday, Bob had the honor of speaking on a panel—Utility Regulation and the Fight Against Coal. Given CUB’s extensive first-hand knowledge about using utility regulation and economics to close the Boardman coal plant, Bob obviously had a lot to say. He recounted the integral role that CUB played in convincing PGE to model closing Boardman early in light of current and future carbon regulation and the associated economic risks. Bob also shared some great advice for other people and organizations advocating for the closure of coal-fired power plants in their states. Bob ended the panel in his usual boisterous fashion, exclaiming: “Oregon’s going to close a freakin’ coal plant. And not just any coal plant — a freakin’ base-load modern coal plant built in the 1970s.”
All in all, our weekend in Eugene was a lot of fun and we got to spend a lot of time doing something we love—talking about CUB. I even had the pleasure of introducing SA to some of my favorite Eugene haunts—the Bier Stein, Sushi Domo, and Sweet Life. Until next time, Eugene!
Troutdale Library Workshop with CUB Connects
The CUB Connects crew headed to Troutdale this past Friday to offer our first educational workshop on Understanding Your Phone and Internet Bill. It was a small event, and the attendees were very grateful for the information we shared. The experience gave us a lot of motivation to continue offering workshops in the community.
The schedule of our upcoming workshops is available here . All of the workshops are free to the public and are conducted in partnership with the Multnomah County Library system. We are planning on offering workshops outside of the Portland area in the near future, so stay tuned for more updates.
The past few months have offered a lot of opportunities for CUB Connects to share our information around the Portland Metro Area. We attended the last 3 Fix-It Fairs offered by the City of Portland, and we look forward to many more CUB Connects events.
To stay up-to-date on all of CUB’s exciting news, sign up for our e-newsletter or follow us on Facebook!
Bob Jenks’ Appearance On KBOO’s Locus Focus
On Monday, CUB’s Executive Director Bob Jenks visited the Portland studios of KBOO-FM to speak with Barbara Bernstein, host of the show Locus Focus.
Bob discussed the history of the campaign to create CUB, what CUB does today, and how it benefits Oregonians. He also talked about the fight against corporate influences in utility regulation, the closure of the Boardman coal plant, the elimination of nuclear power in the Northwest, the creation of the Energy Trust, and the Renewable Energy Standard, among many other things. (It doesn’t take much to keep him going!)
When asked about the future of energy here in Oregon and in the United States, and what CUB is doing to help shift the energy paradigm, Bob stated:
“This is really critical. We’ve got to deal with climate change, we fundamentally have to change where we get energy, how we deal with electric energy, and we need to do it in a way that’s affordable. So the first thing for keeping things affordable in energy is to invest as much as we can into energy efficiency and conservation, because that’s the cheapest resource we have.
“The second thing that we have to deal with is that we have to fundamentally change our relationship with coal. Boardman is sort of a classic example because it’s close by, it’s the biggest coal plant serving Oregon, and it’s the largest emitter of carbon pollution in Oregon. It’s one of about 28 coal plants in the west that serve Oregon customers, so getting the agreement to close Boardman was really important—but we still have a lot of other coal plants we need to look at.
“Now is our real opportunity, because the Clean Air Act is requiring all kinds of new investments in existing coal plants to keep them operating, and what we’re demanding is that every utility company that operates a coal plant has to systematically—before they make those investments—examine whether it makes more sense to make those investments with what we know about climate change and expected carbon regulation, or if it makes more sense to retire those coal plants. That kind of analysis is what led PGE to close Boardman.”
Bob thoroughly enjoyed being on KBOO, and welcomes continuing the conversation at any time. You can listen to the entire 43-minute broadcast by going to the KBOO archives.
If you would like to support CUB in the fight for clean and affordable utilities in Oregon, there’s no better way to do so than becoming a CUB member today!
Remembering Harry Shaich: Activist, Father, Benefactor
Above: Harry receiving a CUB Founder Award on behalf of his son Eric
For nearly 2 decades, CUB has hosted a number of interns for our policy and regulatory programs. These interns have gained valuable experience in the energy industry, helping our work tremendously and enabling us to help make a difference for Oregon utility customers. Their work is a fulfillment of Harry Shaich’s vision—one that has benefited CUB and utility customers considerably.
All of us at CUB were saddened to hear that Harry recently passed away. Our hearts go out to his family, because we know that above all else, Harry cared for his family.
I first met Harry in 1992. He was coping with the recent death of his son, Eric. While at the University of Oregon in 1984, Eric Shaich had been a student volunteer on the initiative campaign that created CUB. Eric was interested in energy issues and went on to work for the Bonneville Power Administration. When Eric passed away, Harry and the Shaich family wanted to do something to honor Eric and create a lasting memorial for him.
After Harry contacted me, we began discussing whether CUB could create a living memorial for Eric. This led to the Eric Shaich Internship Program. The Shaich family contributed an endowment for the program, then worked with CUB to grow that endowment to a level that allowed us to sponsor paid student interns on a sustainable basis using its interest.
Harry was an activist who was very concerned about issues relating to peace, poverty, and environmental protection. And Harry loved his family. As a parent, you want your children to outlast you. You want to watch your children grow up and make a difference in the world. Harry took his love for his son and helped create a program that allowed Eric’s desire to make the world better continue on as a lasting legacy. CUB and our many interns have greatly benefited from his generosity.
Today, the modest internship program founded by Harry has grown to include annual Eric Shaich interns and law clerks, as well as the capacity for CUB to utilize legal externs and fellows. Many former Shaich interns have gone on to work in the fields of energy and public interest advocacy, including Phillip Kelsven, a founder of the Association of Energy Professionals NW and currently a Program Analyst at the Conservation Services Group; Jed Jorgesen, currently the Senior Energy Project Manager at Energy Trust of Oregon; and Linda Tomassi, CUB’s Board Chair and the Executive Director of Oregon Women Lawyers. Meet CUB’s past Shaich Interns.
Harry and his son Joel at CUB 20th Anniversary Dinner
Harry’s family has graciously encouraged people to make a donation to CUB’s Eric Shaich Memorial Fund as a way to honor two generations of a great Oregon family. Contributions can be made online at http://cubpolicycenter.org/shaich or can be sent to:
Eric Shaich Memorial Fund
CUB Policy Center
610 SW Broadway, Suite 400
Portland, OR 97205
We strive to continue the vision of Harry and the Shaich family through the educational opportunities we offer to students and young professionals. It is an honor to have worked alongside Harry Shaich to build the Eric Shaich Memorial Internship.
Bob Jenks Visits Energy Law Class
This week, CUB Executive Director Bob Jenks headed down to Eugene to speak with Environmental Law Alliance Worldwide Staff Attorney and Adjunct University of Oregon School of Law Professor Jen Gleason’s spring term energy law class. Bob is always excited to share his longtime experience with the energy industry with young professionals, and spoke about the Oregon Public Utility Commission and the role of CUB.
Jen Gleason said, “It was great to have CUB’s Executive Director Bob Jenks come speak with the Energy and the Law class at the University of Oregon School of Law.
“Bob shared his vast experience working on energy issues in Oregon and was able to give real-world context to the theoretical discussions we were having about the authority of the Public Utility Commission and how rates are set for investor owned utilities in Oregon. Most importantly, Bob shared CUB’s experience using regulatory processes creatively to help convince PGE to shut down its coal-fired power plant ahead of schedule to reduce carbon emissions. We really appreciated Bob taking the time to come talk with us – it was a fantastic lecture.”
We thank Jen and her class for hosting Bob—and If you’d like the opportunity to meet Bob, CUB staffers, and CUB board members, you’re in luck! CUB is heading down to Eugene March 1-4 to participate in the University of Oregon School of Law’s Public Interest Environmental Law Conference. Bob will be sitting on a panel during the conference, and on Thursday, March 1st at 5:30 PM CUB is hosting a Meet and Greet at the Agate Alley Laboratory with our board, staff, and Bob in celebration of Bob’s twenty amazing years with CUB. RSVP now—we’d love to meet you and folks interested in CUB and the work we do!
And stay up to date on our work by joining our email list or liking us on Facebook! We have an exciting year ahead of us, and we look forward to sharing it with you.
Going Green at the 2012 International Portland Auto Show
The Portland International Auto Show , held on January 26-29, 2012, displayed the automobile industry’s newest and most popular car models. CUB Utility Analyst Gordon Feighner and I had the opportunity to attend the opening night of the show and participate in a special preview of the “Eco” section. A floor above the main show area, the ECO Center, which displayed approximately 40 “environmentally-friendly” vehicles that are certified as low- to no-emissions. Jeff Cogen, Multnomah County Chair, and Charlie Allcock, Director of Transportation Electrification at PGE, first welcomed us and 30 other visitors to the showroom. The focus of their introductory remarks was the advances made by the electric vehicle industry in the past year. Mr. Cogen briefly discussed the benefits of these vehicles for the environment and for Oregon. Mr. Allcock highlighted the lofty deployment goal our state is trying to achieve—30,000 plug-in electric vehicles by 2015—before inviting us to explore the vehicles on display.
Electric vehicles were the star of the show in the ECO Center. Gordon and I took turns sitting in each of the electric vehicles on display: a Nissan LEAF, a Mitsubishi i , a Coda sedan, and a Chevy Volt (a “range-extended” electric vehicle, which is a plug-in vehicle with an electric motor and a small gasoline engine that charges the battery pack when the battery runs low and cannot be plugged in). We also looked at a Transit Connect, an all-electric truck made by Ford and Azure Dynamics, and two locally produced models, a three-wheeled electric vehicle by Eugene-based Arcimoto and a one-wheeled creation (essentially a souped-up electric unicycle) by Ryno Motors, a company based in Portland. The Ryno electric vehicle was definitely Gordon’s favorite, as you can tell by the photo below.
Here I am sitting in a three-wheeled all-electric vehicle prototype designed by Arcimoto, a company based in Eugene.
Gordon approves of the Mistubishi i.
The Transit Connect on display, an all-electric van designed for business deliveries.
In addition to electric vehicles, the ECO Center had other efficient cars, such as the Toyota Prius (a hybrid vehicle with a both a gasoline engine and electric motor) and a Smart Car. Gordon and I, however, were surprised to see a Yukon Denali hybrid—a large SUV—included in the ECO Center. It is a hybrid vehicle, but with a gas mileage of 20 miles per gallon in the city and 23 miles per gallon on the highway (vs. 13 city/18 highway for the non-hybrid version), it’s a stretch to call it an environmentally-friendly car. The Denali hybrid is a perfect example of how some automobile manufacturers are trying to be “green” without alienating the part of their customer base that demands big vehicles like SUVs.
The contrast between the ECO Center and the rest of the auto show a floor below was somewhat shocking. On the main floor the emphasis was not on the environmental attributes of the cars, but their style, speed, and amenities. Most vehicles had dismally low gas mileages. Some of the models were gigantic—the hood of one Dodge Ram model was taller than I am! One SUV really took in-car entertainment to the extreme; it had 6 mini television screens: one on the back of each seat and two attached to the ceiling.
Yet, mixed in with the conventional vehicles on this floor were a few eco-friendly vehicles, including the Fisker Karma, a luxury range-extended electric vehicle. The Chevy Volt made another appearance on this floor as well. It is interesting to note that both these models resemble conventional vehicles in terms of their design and size—unlike other electric vehicles such as the Nissan LEAF and Mistsubishi i that have very unique, futuristic designs. It’s a demonstration of how different automobile manufacturers are approaching the electrification of transportation: while some are simply altering their current models to have electric drive trains, others are taking the leap and creating entirely new models.
The Fisker Karma. All the luxury and speed you could ever want
—all in an electric car.
This year’s ECO Center was the largest that the Portland International Auto Show has ever had, indicating a growing interest in alternative, more sustainable technologies that can break our transportation system’s dependance on imported fossil fuels. If deployed in conjunction with smart energy policy decisions, electric vehicles can be powered with renewable energy produced right here in Oregon. Perhaps in five years, the ECO Center will display an electric vehicle with an even more amazing capability: Vehicle-to-Grid (commonly referred to as “V2G”), which is the technological ability to store and release power back the electric grid, depending upon the demand or supply of electricity needed on the grid at any given time.
CUB is working now, through my project and with our public interest allies, to help develop this cleaner and more intelligent transportation system that will benefit our environment, our economy, and our quality of life. Check out my earlier blog entry to learn more about my project and keep reading our blog for future updates on our electric vehicle policy work!
And to say up to date on all the exciting work CUB is involved in, join our mailing list and like us on Facebook!
CUB Attends the Northwest Public Service Career Fair
On Saturday, February 4th, CUB’s Business Director SA Anders and I had the pleasure of spending the morning with some of Oregon’s brightest and most enthusiastic law students at the NW Public Service Career Fair. Each year, Lewis & Clark Law School hosts the Portland chapter of the fair, which seeks to link law students and alumni with opportunities to work with organizations that make a difference. This career fair is unique in that, as the name suggests, it is geared toward students and alumni who have a particular interest in public service—a perfect match for CUB!
We spoke to more than 30 law students about CUB and the regulatory and policy work that we do on a daily basis. It was great to learn that so many of the career fair participants already knew about CUB, and we were certainly happy to tout all of CUB’s accomplishments to those who hadn’t heard about us yet. We also loved talking to budding lawyers who have such a strong interest in the issues that are near and dear to CUB’s heart.
All in all, the Career Fair generated a lot of interest in CUB’s law clerk program, and we could not be more excited to add a new member to the team this summer. If you are interested in applying for a summer clerkship or fall/spring externship with CUB, please visit CUB’s Law Clerkship page at http://cubpolicycenter.org/opportunities. The February 15th application deadline for summer clerkships is fast approaching, so we encourage all who are interested to submit their materials as soon as possible!
Also, you can like us on facebook to stay up to date with all the latest energy, regulatory, and sustainability news from CUB!
Kicking Off Bob’s 20th Anniversary Celebration
Last Wednesday, February 1st, CUB supporters and close friends of Bob Jenks came together to kick-off the celebration of Bob’s 20th anniversary as CUB’s Executive Director. Local brewpub Migration Brewing hosted the low-key event that included a few words from Bob and a commitment from attendees to support CUB in honoring Bob over the next year.
It was great to have people who worked on the original 1984 campaign to put CUB on the ballot, past co-workers of Bob’s at OSPIRG, and many of CUB’s current allies and friends come together to enjoy delicious local beer and good conversation. CUB’s success over the years was made possible by Bob’s committed service and the incredible support of our community. Thank you to everyone who stopped by.
To stay up-to-date on Bob’s 20th Anniversary Celebration sign up for our e-newsletter and check out the new page dedicated to Bob www.oregoncub.org/bob. We look forward to sharing many more fun events and special moments celebrating Bob’s 20 years of dedicated service to Oregon as a public interest leader.
Where are they now? Touching Base with Phil Kelsven
CUB has had a strong history of offering educational opportunities to students and young professionals interested in working in the energy sector and for the public interest. Our Schiach internship has been a great asset to CUB and we think it’s important to highlight some of the individuals who spent their time with us as interns, volunteers and board members throughout the years.
Phil Kelsven interned at CUB in 2005-2006 when he was completing his master’s degree in Economics from Portland State University. Phil is originally from Fargo, North Dakota, and after he received his undergraduate degree, he wanted to move west. His brother was living in Portland, so he ended up here. When I asked him about his memories at CUB, Phil said his most memorable experiences were “lunches with the crew and listening to Bob and Jason tell sordid stories about the world of utility regulation.”
Phil is currently a Program Analyst at Conservation Services Group (CSG), an energy efficiency company that is headquartered in Portland. Phil does market and demographic research, statistical analysis, GIS mapping, and program evaluation for CSG’s energy efficiency programs nationwide.
According to Phil, CUB greatly influenced his career path. “CUB gave me experience in the world of energy, and was a big reason I got my first job out of grad school at Energy Trust of Oregon (ETO).” Phil also was part of the original group that started Future of Energy (now the Association of Energy Service Professionals (AESP) Northwest), a networking group for young energy efficiency professionals. The group first met at Rogue Pub in 2007, with the old timers and youngsters talking energy over beer and food. The group’s first big event featured Fred Gordon from the Energy Trust of Oregon and Tom Eckman from the Northwest Power Planning Council at the Fez Ballroom with a DJ. Future of Energy grew slowly. According to Phil, “we had a speaking series on climate change and energy at Aura and got a few sponsors. We mixed dense topics with a hint of hipness over happy hour; I guess it worked.” At first the group found it difficult to keep the momentum going, so they formalized the group and created a board in 2008 with Phil as the President. He’s still the AESP Northwest Treasurer.
Phil married his wife, Jennifer, in 2009. They recently welcomed a new addition to the family, baby Kaden, born on May 27, 2011.
When I asked Phil if there was anything more he’d like to say about CUB, he said that “CUB is doing great work that is really needed by the people of Oregon. It is rarer than you think to have ratepayer advocates that are as progressive and effective as CUB is in Oregon. A real blessing, indeed!” We’re honored to receive such a great compliment from one of our past interns.
Thanks for sharing, Phil! Good luck presenting your papers on residential energy consumption variability at the 2012 ACI Home Performance Conference in Baltimore and on data mining for energy efficiency marketing at the 2012 ACEEE Summer Study Conference.
If you are interested in utility regulation, energy efficiency policy, renewable energy efforts, or consumer protection, an internship with CUB might be right for you. To find out more about the educational opportunities at CUB, visit www.cubpolicycenter.org/opportunities.
Energy Exporting: Still a Bad Idea
Though it is sometimes enjoyable, saying “I told you so” is usually not an indication that the best outcome of a situation has been achieved. That’s certainly the case with the pending applications for liquefied natural gas (LNG) terminals on the Oregon coast. In 2010, I wrote about these potential projects, which at that time were intended to be built to receive imports of LNG from the Middle East. Over the past couple of years, however, a sharp increase in the supply of shale gas from the Rocky Mountains has led to a glut of supply and low prices for domestic gas. Without any need for increased supply from foreign markets, the backers of these projects have shifted their plans and applied to develop the terminals as export facilities.
As I noted in my previous entry, the environmental and safety hazards posed by LNG facilities are reason enough to oppose their construction in Oregon. LNG export, however, has the potential to negatively impact gas prices for consumers, both here in Oregon and nationwide. The US Energy Information Administration (EIA) recently released a report that predicted significant increases in consumer energy costs resulting from LNG export. Between 2015 and 2035, the impact on natural gas bills is projected to be between 3 and 9 percent, and the impact on electricity bills would range from 1 to 3 percent. These numbers are also only the average increase; the study indicates that higher export levels could lead to price spikes of as much as 60% in the earlier study years. So, on balance, the benefits of LNG export would go to foreign customers and project developers, while Oregon citizens would be faced with the environmental and cost impacts of the projects.
LNG isn’t the only energy source being considered for export from the Northwest. A number of proposals have been put forth to build a coal export terminal somewhere in Oregon or Washington. For example, Ambre Energy, an Australian company, has been working towards constructing a coal export facility along the Columbia, either at the Port of Longview, WA, or at Port Westward, OR. Since the lack of port capacity has been the primary limiting factor for coal exports, a large, dedicated coal export terminal will dramatically increase the amount of American coal shipped overseas from the West Coast. This will result in increased carbon emissions and other atmospheric pollutants at a time when the two major coal power plants in the northwest have agreed to cease operations. Power plant emissions from Asia are already the largest source of mercury deposition in the Northwest, and that situation will only grow worse with the increased supply from an export terminal. While the price impacts of coal export are less certain than those of LNG, there are definitely solid environmental arguments against building a coal export terminal in Oregon or Washington.
UPDATE: On Wednesday, January 25, the Port of St. Helens approved the applications of both Ambre Energy and Kinder Morgan to build coal export terminals at Port Westward. These two projects now face local, state, and federal permitting processes before construction can begin.
Oregon’s Attorney General John Kroger continues to be vocal against any LNG terminals in Oregon. Also, The Sierra Club has created a petition to Governor Kitzhaber requesting that he put a stop to coal exports in Oregon.
CUB will continue to monitor these projects and do what we can to spare Oregon utility customers from the negative impacts of exporting American energy. To stay up to date on the latest news, sign up for our e-newsletter—and consider becoming a CUB member. Your contribution directly helps our sustainable, affordable, energy future.
January Fix It Fair Great Fun!
On Saturday, January 21st, Emmaline and I headed to Rosa Parks Elementary in North Portland for our second community Fix-it Fair. The City of Portland hosts these fairs to connect Portland residents to information and resources that can help them save money and be healthy at home. The fairs are free and open to the public.
We spoke to over 60 people about the CUB Connects project and ways they can better understand and select phone and internet service options in their area. We were also excited to invite Fix It Fair attendees to a series of new workshops CUB Connects is hosting in the next few months in partnership with the Multconmah Library System.For more information and to save the dates, check out the schedule at http://www.cubpolicycenter.org/events.
Emmaline also shared information about CUB’s consumer education outreach project that will help Oregonians understand how electric vehicles—if implemented with the right policies and focus—can be a benefit to our state’s economy, electrical grid, and environment. It was rewarding to introduce this growing project and talk to attendees about an up-and-coming technology CUB has a vested interest in.
Overall it was a great day working in the community and talking to fellow Portlanders—we hope that all of the attendees and fellow volunteers feel the same!
The next Fix-It Fair is coming up on February 25th, 2012 from 8:30 a.m. – 2:00 p.m. at Jefferson High School, 5210 N Kerby Ave in Portland. We hope to see you there!
Make sure to follow us on Facebook and sign up for our e-newsletter to stay up-to-date on all of CUB’s work and activities. And remember to add a CUB Connects workshop to your calendar!
Tax Credits for Energy Efficiency
Did you make energy efficiency improvements to your home in 2011? Did you buy any new energy efficient appliances through the Energy Trust of Oregon or other incentive programs? If you did either of these, you may qualify for tax credits on both the federal and state level.
For products purchased in 2011, to receive a federal tax credit you can file IRS form 5695 and enter the tax credit amount on line 52 of your 1040 form. Form 5695 must be submitted with your 2011 taxes by April 17, 2012. Also keep in mind that you should always save your receipts and manufacturer’s efficiency certification statement for your records.
Energy efficient products that are eligible for tax credit can be found on the Energy Star website. These include water heaters, biomass stoves, HVAC, insulation, roofing, windows and doors, and fuel cells, as well as solar, geothermal, and wind turbine systems. Please note that not all Energy Star certified products are available for this credit; they must be the specific model listed on the Energy Star website above.
In the state of Oregon, tax credits are available for the above-mentioned products, as well as for clothes washers, dishwashers, and refrigerators. As we reported back in October, 2011 is the last year that credits for these additional products will be available. Again, not all Energy Star appliances qualify for this credit, so check to make sure your model is on the list by clicking the link above and selecting “Qualifying Refrigerators”, “Qualifying Clothes Washers”, or “Qualifying Dishwashers” in the right had column. Please note that each energy efficient product installed in 2011 must be applied for separately in Oregon, and the forms vary for each product. Application forms can be downloaded by selecting the particular type of product from the Oregon Department of Energy website.
Other incentives and rebates may be available to you if you have participated in The Energy Trust of Oregon Home Energy Solutions program. For more information about this program, please visit http://energytrust.org/residential/.
Make sure to follow us on Facebook and sign up for our e-newsletter to stay up-to-date on energy efficiency tax credits and other energy, telecom and environmental news.
A New Year Brings New Regulatory Challenges
Happy New Year from the CUB Regulatory Program!
Here at CUB, we are entering the New Year with new energy, new ideas, new staff assignments, and an assortment of interesting new dockets. And the Public Utility Commission (PUC) once more has THREE commissioners – welcome new Commissioner Steve Bloom! (Pictured above, left, with CUB staff Andrea Crosby and Bob Jenks)
Staff Assignments
At the end of December we bid “Bon Voyage!” to John Sturm, who reached the end of his limited duration clerkship and part-time Staff Attorney position here at CUB. In his time at CUB John graduated from being a law clerk to being a full-fledged attorney, a good team player, able researcher, and blogger extraordinaire. John’s gentle sense of humor and kindness will be missed. Anyone seeking an attorney with experience in telecom, energy, environmental, or natural resources law should get in touch with John Sturm.
We also welcome Sommer Templet, who has also completed the transition from law clerk to part-time Staff Attorney. In her short time with CUB Sommer has proved to be an excellent researcher and talented writer, as well as to have wisdom beyond her years and a ready sense of humor and creativity. We are delighted that Sommer has decided to stay on at CUB!
New Dockets Opened at PUC
NW Natural’s 2011 General Rate Case. On December 30, 2011, NW Natural (NWN) filed a General Rate Case, its first since 2002. The rate case filing contains many moving parts and we have just begun analyzing it. Suffice to say, NWN, which in CUB’s analysis has been over-earning for some considerable time, and wants you and me to pay even higher rates. They are asking the PUC to sock it to residential customers with a 10.5% increase in residential rates. NWN also wants to change the current residential rate design, raising the monthly base charge from $5 to as much as $29 over a three year period. This means that even if a customer doesn’t use any gas during July or August, they would still receive a $29 bill for the monthly base charge. While the total amount all customers will pay for gas over the course of the year won’t change , the structure strikes us as fundamentally unfair, and akin to a grocery store charging customers a base fee every time they come through the door, regardless of how much they spend on their groceries. In addition, it is a change that will increase costs for customers who use only a little gas and will decrease costs for customers who use a lot of gas. NWN also wants an additional increase to cover environmental costs associated with the old manufactured gas plants the company used to make gas before the advent of pipelines.
Given that NW Natural already has a mechanism that protects its profits from loses due to customers installing energy efficiency measures, and it has a mechanism to protect its profits from customers using less gas due to warm weather, it seems to CUB that what NW Natural really wants is to change the way it is regulated so that it will always have guaranteed profits without taking any risk.
The bottom line is that this large, 10.5% increase is being requested when the economy is still struggling and unemployment in Oregon is still high. With its shareholders benefiting from substantial profits and its upper management being generously rewarded by the shareholders, it seems to CUB that NWN is out of touch with the realities facing the vast majority of ratepayers in Oregon; bills are already tough to pay. For all of these reasons, CUB’s regulatory staff intends to devote CUB’s efforts to scrubbing this filing to remove the fat and to challenge the company’s proposed change to the monthly base charge.
Cascade Natural Gas files its 2011 Integrated Resource Plan (IRP). Integrated Resource Plans describe how a utility intends to make investments to meet its obligations to provide energy to customers. Cascade Natural Gas Co. filed its 2011 IRP on January 3, 2012. The Regulatory Staff are just cracking this one open and will keep you informed as it develops.
PGE files to test the transition from coal to biomass at Boardman. CUB was successful in getting PGE to agree to replace the Boardman Coal Plant by the end of 2020 and at the end of December, 2011 PGE filed a docket to move forward with the transition. The new docket requests an accounting order that will allow PGE to run a test burn of biomass at Boardman in 2014. The purpose of the test is to determine whether it is feasible to replace coal burning at Boardman with biomass. CUB will be intervening in and investigating this filing and we’ll keep you up to date as it progresses. CUB began researching the Boardman case over the summer last year – to learn more check out these previous updates - What’s Next for Boardman? and Burning Biomass.
An investigation into fuel switching commences. Staff at the PUC asked the Commission to open an investigation into energy efficiency and fuel switching. This docket is expected to explore issues that have been raised by NW Natural relating to the best use of natural gas (direct use in homes versus generating electricity) and how energy efficiency incentives affect the fuel that is used to heat homes. CUB has intervened and will be monitoring this docket closely.
These are just a few of the recently filed dockets that CUB’s regulatory program staff will be spending its time on over the next few months. As the year goes forward, we are expecting many more utility filings, including some large requests to raise rates and make additional investments into coal generation. Lots of new and interesting issues will be discussed, and we look forward to keeping you apprised as we review these dockets and the PUC rules on them.
What About Bob?
Twenty years ago this month, Bob Jenks started as CUB’s Executive Director. The Board picked Bob in December, 1991 right before he took off to marry his wife, Jill, and he started his new job in January 1992. To honor his 20th Anniversary with CUB and two decades of leadership, accomplishments and wise-cracks, we will be doing a series of blogs about Bob.
First thing to know about Bob: he loves wise-cracks. My first experience presenting in front of the Public Utility Commission (PUC) was in early 2011. I was prepared but also nervous. As we walked into the building I asked Bob something work-related and his response was something like “darn, I haven’t thought of a wise-crack to start out with. Oh well, it will come to me.” (He may not have said ‘darn’ but we keep these blogs G-rated.) As one of CUB’s newest staff members, this took me by surprise. I was worried about the PUC approving four months of hard work and Bob was wondering what amusing comment he would start with.
When it was our turn to present, I realized this wasn’t just Bob’s expectation of himself but that everyone in the room, including the Commissioners, were anxiously awaiting Bob to begin our presentation.
How did I know? Commissioner Savage made it pretty clear when he said, “I can’t wait to hear what Bob comes up with today.”
Here at CUB we are looking forward to celebrating 20 years of Bob Jenks. We hope you will find our updates inspiring as well as entertaining.
So, what about Bob?
Here are 5 words that may describe him best:
Bearded – since growing a beard before he was 20, Bob has only shaved it off once. It’s iconic in a sense as we have seen it mentioned in a number of newspaper articles throughout the years. The following is a great example but Bob would like to note, that he’s only been barefoot in the office once:
“The two are the bearded (and often barefoot) Bob Jenks and his clean-cut cohort Jason Eisdorfer….With a deft combination of Jenks’ mind-boggling capacity to understand rate schedules, amortization and the physics of electrons and Eisdorfer’s ability to translate Jenks’ brainy analysis into English, the two are Oregon’s most outspoken and effective critics of Enron’s deregulation plan.”-Willamette Week, 1998
Oregonian –while he spent some of his younger years in Alaska, Bob is a native Oregonian and loves the state. He is a graduate of Hillsboro High School and Willamette University. After a post-college stint in Massachusetts to work on a bottle bill campaign (a very Oregon thing to do), Bob’s been back in Oregon since 1983.
Organizer – Bob started his career as an organizer as a college student. After graduating, he went east of the Rockies for the first time to work on the campaign to establish a Massachusetts Bottle Bill. Bob returned to Oregon in 1983 and began working with OSPIRG (the Oregon State Public Interest Research Group). Later, as an OSPIRG staffer, Bob was part of the original 1984 ballot measure campaign to form CUB. He strongly believes in organizing and grassroots support as essential tools for change and progress.
Advocate –CUB is first and foremost an advocacy organization and under Bob’s direction we have intervened on behalf of Oregon ratepayers in over 80 rates cases, saving ratepayers over $4.5 billion in his 20-year tenure.
Boisterous – for those of you who know Bob, he isn’t big in stature. What he may lack in height he makes up for in intelligence, personality and passion. Often times these three things combined lead him to be perceived as boisterous and here at CUB, it’s just another thing about Bob that we embrace. Especially when it leads to headlines such as this:
“Titans of Energy vs. the little guy: CUB’s Bob Jenks tackles Enron and PGE”, Portland Alliance, April, 1998.
Or more recently, as quoted in a local newspaper, referring to the Boardman coal plant:
“Oregon’s going to close a freakin’ coal plant,” he said. “And not just any coal plant — a freakin’
base-load modern coal plant built in the 1970s.” – The Columbian (Vancouver, WA); November
12, 2010
CUB is very proud of Bob and his time with the organization. We’ll be talking about our ongoing work as usual throughout the year but Bob’s 20th anniversary gives us an opportunity to reflect on his work and all the changes that have occurred, both at CUB and on energy and utility issues. We hope you enjoy this next year reading about new issues and new victories but also some memories about Bob’s 20-year history with CUB.
CUB’s 2011 Accomplishments
Here at CUB, our small staff works tirelessly in the fight to keep utility rates fair and affordable for customers, while also ensuring that utility practices remain in line with our values as Oregonians. 2011 was another great year for CUB, full of many victories and accomplishments for Oregon ratepayers.
Here are a handful of our accomplishments from last year, broken down by the type of utility:
Electricity
• CUB helped negotiate an agreement designed to end 30 years of litigation over the allocation of federal hydro power benefits among Northwest utilities. This agreement ends a fight that goes back to 1980, and allows the region to focus on our more serious concerns with our hydro power: protecting endangered salmon, integrating wind generation, and adapting to changes in snowpack due to climate change.
• CUB supported the broad coalition to enact the Cool Schools proposal, which brought into focus the need to make our education infrastructure more energy efficient.
• PacifiCorp sought a $61.6 million increase in its power costs, which would have caused a 5.6% rate increase to customers in its service territory. CUB fought hard during this proceeding to make sure that PacifiCorp customers’ issues were ad¬dressed. During the proceeding, PacifiCorp agreed to accept parts of the proposal made by CUB and other intervenors, which reduced PacifiCorp’s request by $7.9 million.
• CUB negotiated $13 million in savings for ratepayers in PacifiCorp’s annual income tax true-up docket.
• CUB’s greatest victory of 2010 was affirmed earlier in 2011, when the US Environmen¬tal Protection Agency (EPA) approved PGE’s plan to close the Boardman coal plant before it’s expected lifetime. The early closure will save customers $200 million and allows the company to avoid significant future investments to maintain the plant.
• CUB took issue with PGE’s natural gas and electricity market hedging strategies, arguing that the company hedged too much gas too far in advance. As a result of CUB’s argument (which was made in conjunction with the Industrial Customers of Northwest Utilities [ICNU]), the Commission reduced the amount PGE could charge customers for its net power costs by $2.6 million.
• The CUB Policy Center invited industry, law, and regulatory professionals to partake in its inaugural policy conference: Smart Grid Today’s Regulation and Tomorrow’s Technology. We were delighted at the response; the event, held in conjunction with the University of Oregon Law School, brought 150 energy professionals together to discuss the Smart Grid in Oregon.
Natural Gas
• CUB fought to reduce Avista’s rate increase by $3 million.
• CUB got NW Natural to withdraw its request that a $7.7 million surcharge be placed on customers’ bills to offset higher taxes the utility faced.
• CUB convinced NW Natural to withdraw a plan to defer nearly $4 million in pension costs that were to be charged to ratepayers. While CUB is aware that the company’s pension plan needs an overhaul, tagging ratepayers with a large portion of the bill was not an acceptable solution to the issue.
Telecom
• Our CUB Connects project was publicly launched, providing a search engine that helps consumers compare prices and telecommunications products. CUB worked to ensure that as a condition is attached to the CenturyLink/Qwest merger requiring an additional $45 million investment in broadband in Oregon. By year’s end, the CUBConnects website attracted over 10,000 visitors.
• CUB significantly increased its advocacy on behalf of low-income ratepayers by participating in over a dozen dockets related to the use of Universal Service Funds in Oregon. CUB is actively working to make sure that any company that gets certi-fied to provide these services will provide adequate customer service and service packages that will be valuable to customers.
• The acquisition of Qwest by CenturyLink closed in early 2011, following a lengthy hearing process in which CUB advocated for a number of customer-protection measures. CUB was happy to get a commitment from CenturyLink to invest millions of dollars in improving its broadband network in the coming years, which should improve rural Oregonians’ access to the internet.
Even with all of these victories and accomplishments, our work is never done. Already in 2012, we see a number of threats for higher rates on the horizon, and we’ll continue to keep you up to date on the work CUB is doing to keep utility rates fair and affordable. Since 1984 we’ve saved Oregonians over $5.4 billion and counting. If you want to join us in the fight, we could use your help. Please consider becoming a member of CUB today, and signing up for our e-mail updates. (We also appreciate your “likes” on Facebook!)
Oregon HEAT: Neighbors Helping Neighbors Keep the Heat and Lights On
It’s now officially winter, according to the calendar, with frost on the ground in the morning and the appearance of hats, gloves, and scarves. For some Oregonians, the falling temperatures and early nightfall represent more than just a change of season. These signal the beginning of months of anxiety for low-income residents who struggle to afford their increased heating and/or electricity bills. Thousands of residents this winter will face difficult decisions that no one should have to make: pay their utility bills and to keep the lights and heat on, or purchase other necessities, such as food or medical care, and risk having their services shut off. This year has already been a hard one; thus far, 27,000 Oregonians have had their electricity shut-off due to non-payment.
One important local non-profit organization exists to support these Oregonians and ensure fewer families are left in the cold or the dark. Oregon HEAT, founded in 1989, is an independent 501(c)3 organization that partners with community service agencies to distribute funds to pay the utility bills of individuals struggling to afford them. Earlier this month, Roger Rees, Executive Director of Oregon HEAT, visited CUB’s office to brief staff on his organization’s activities and the challenges he sees for the upcoming winter season.
Rees described the central philosophy at Oregon HEAT as “neighbor helping neighbor.” Thus, Oregon HEAT makes certain that funds donated by individuals to the organization are disbursed back to families requiring assistance in the same county. Additional funding comes from private utilities, in particular PGE and PacifiCorp. Another source of funding is the organization’s innovative oil recycling program, which transforms waste-oil into a new product and generates income that goes to serve its clients. Oregon HEAT partners with the Oil Re-Refining Company to collect used oil from businesses, organizations, and individuals; re-refine it back into a usable form; and sell this “new” oil. It’s been a strong success—in Harney County alone, 100% of oil-waste producing companies participate—and other states have reached out to Oregon HEAT for assistance in setting up similar programs.
The organization’s main goal when delivering aid is to lift households completely out of their debt owed to utilities, enabling them to be self-sufficient again. To do this, Oregon HEAT ensures that ninety cents of every donated dollar is returned to the community to help affected households. Unfortunately, due to limited funds and the large demand for aid, Oregon HEAT is only able to provide assistance to individuals once per year.
The weak economy has dramatically increased the need for Oregon HEAT’s service. Rees stated that, with the poverty rate in Oregon hovering at 14% and the unemployment rate just over 9%, many more households will be experiencing the threat of a shut-off this year. These economic difficulties are compounded by the fact that the traditionally largest federal funding program for low-income heating assistance, LIHEAP, is facing cuts and delayed distribution. Rees reported that, with the proposed cuts of $1.1-1.3 billion, only 18% of Oregonians eligible for this assistance will receive it, increasing the demand on other supporting agencies, including Oregon HEAT.
This reality of increasing economic hardship began an interesting discussion during the briefing, which centered on the importance of collaboration between organizations like CUB and Oregon HEAT, whose missions revolve around supporting vulnerable Oregonians on similar issues. Rees highlighted the fact that people unable to pay for their heating or electric utility bills are typically also struggling to cover other bills as well, such as their phone/internet plans. Our own CUB Connects can be a powerful tool to minimize the financial burden on households and also can indirectly affect the work of Oregon HEAT.
Andrea Crosby, program manager of CUB Connects, noted that when individuals use CUB Connects to choose the right telecommunications plan for them—getting out of more expensive plans with features they never use—they save money and can put that toward paying their other utility bills. As a result, households may have more financial resources to put towards other expenses, perhaps avoiding the need to use heating assistance offered by organizations like Oregon HEAT.
CUB Connects and Oregon HEAT are two support systems in a pool of many other resources available for people who are struggling to pay for their basic utility services. Ensuring consumers know these resources exist is a crucial, ongoing task and is why here, on CUB’s blog, we share information about the different organizations whose work aligns with our own. If you’d like to learn more about Oregon HEAT, the work they do, and how you can apply for assistance if you are in need, visit their website at http://www.oregonheat.org or call 503-612-6300.
USF Reform: Big Boost for Broadband
Back in October, we wrote about the Universal Service Fund, and the fact that it was slated for a potentially dramatic overhaul. These changes were designed to focus more on broadband internet service and less on traditional landline telephone service. Since then, the FCC did in fact release its proposed changes (PDF) and, as expected, they are designed to provide support for ensuring universal access to broadband services. The order, over 750 pages long, takes some reading and it will be a while before its full effect is actually realized since legal challenges are likely and may ultimately blunt some of its force. This post offers a quick look at some of the likely impacts of the order.
So what would the proposed order do, exactly?
The main driver behind change to the Universal Service Fund is the transition of Universal Service funds from traditional voice-based technologies and services to digital technologies focused more broadly on data. Broadband is not, however, the only driver of reform in the order. The FCC also sought to clear up issues related to certain charges that telecommunications companies make to one another, known as “inter-carrier compensation”, or ICC charges. Reform in these areas is designed to reduce fraud, waste and abuse in the current system.
In terms of Broadband the Order creates a new and separate broadband fund called the Connect America Fund. This fund will ultimately replace current funding for what is known as “high-cost” support. Traditionally, high-cost support is money given to encourage phone companies to spend more on infrastructure and service in areas that are more expensive to serve on a per-customer basis because they are remote or because customers there are more disperse. High cost support currently exceeds $4 billion per year.
The FCC Order also offers some customer service standards by defining broadband as data service with a minimum of 4Mb download and 1Mb upload speeds, and looks to provide money for increased build out in areas where these speeds are not currently available. Additionally, most new broadband service will be required to provide service quality that will allow for internet based voice and video communication, ensuring that consumers will be able to reliably use services such as Skype, Vonage, Google Voice, etc.
To accomplish these goals in the short-term, the FCC has frozen all current USF high-cost support and made an additional $300 million available for broadband. Companies that choose to apply for this support must commit to deliver broadband to one unserved location for every $775 in incremental support they receive.
Beyond providing support for traditional hard-wired broadband, the proposal supports the creation of a “Mobility Fund” designed to foster the development of wireless broadband networks in underserved areas. In the first phase of the Mobility Fund, some $300 million will be awarded via an auction process in late 2012 as a one-time support to accelerate development of wireless networks. The hope is that increased use of competitive bidding processes will better reflect actual costs than the models currently used.
As for the inter-carrier charge issues, the FCC Order seeks to end controversy produced by discrepancies in intrastate and interstate charges. The controversy arises from the fact that many calls have different companies handling the beginning and the end of the same phone call and these companies then bill the same call differently. The difference in billing arises because the companies have diverging financial interests which cause them to label and handle calls differently. And Oregon has not been immune to this problem Oregon.
FCC guidance on this issue is overdue and the new Order attempts to address the problem in several ways. First, it seeks to reduce “terminating charges” (charges one operator makes to another for calls that end on its network). In the long term, this will reduce the incentive for companies to drop or mislabel calls. Second, in the short term, it redefines various terms to allow companies to better detect and file complaints about problems.
It is also worth noting briefly what the Connect America Fund does not do. Outside of the high-cost and inter-carrier reforms, the plan leaves most other USF programs largely intact, though some of these, such as low-income programs like Lifeline, are themselves the subject of separate efforts at reform.
What does this mean for service providers?
The answer to this question depends a lot on what kind of service provider you are. A substantial portion of the order is dedicated to proposed rules dealing with rate of return for carriers, as well as price caps, but exactly how this will affect them remains a subject of much debate.
Cable companies are concerned that they have not been sufficiently included in the order. Specifically, there has been some frustration that many of the ways in which companies can apply for or bid for support under the new rules apply mainly toward traditional phone companies, thereby putting them at a competitive disadvantage. Notably, VoIP service providers will now have to pay some access charges for this service, though not at the rate ascribed to established carriers of voice service.
The phase-down of certain inter-carrier charges mentioned above will almost certainly mean lost income for many small rural providers of traditional phone service. Many have relied heavily on USF funds and access charges, and these providers have already seen declining revenue in recent years. Since the order makes substantial changes in both of these funding areas, these companies are concerned that they will have to raise rates or close up shop.
Prior to the order, some of the larger existing providers and wireless phone companies proposed a plan of their own known as “America’s Broadband Connectivity”, or the “ABC” plan. The FCC order goes further and will take longer than the plan these companies had submitted, but the process is sufficiently similar that they appear to be more generally content with it as a class.
What does this mean for consumers?
In theory, people who live in rural areas where internet service tends to be less available should benefit from these changes. The order makes a concerted effort to reach underserved areas, not just to increase competition in already served areas. For example, if an area is already served by a company that is not receiving USF subsidies, the assumption is that a good enough market already exists, and another competitor entering the market in that area will likewise need to do business without any subsidies. As noted above, the initial standard in many areas will be 4Mb/1Mb. However, in many areas a higher standard will be used either initially or be phased in over time.
The “mobile fund” should ultimately lead to better access to 3G and 4G mobile networks in rural areas. In the long run, this should mean that more people living outside of the developed networks in major cities should have better access to comparable wireless phone data services.
The reform to the inter-carrier charges is not likely to result in savings for many residential phone customers. In fact, it is likely that some areas will see increased rates for basic phone service. However, for many such carriers the FCC order establishes a rate ceiling of $30. The changes to inter-carrier charges should also result in better accountability for some USF funds. The FCC believes that benefits to customers from the increased efficiencies and new rules about charges will far outweigh any increases for basic phone service in many rural areas.
CUB looks forward to following this issue closely. Inevitably, as the various stakeholders have more time to consider the order in the coming weeks, more details will emerge. For readers looking for a brief synopsis of the proposed changes, a 7-page executive summary of the FCC order is available here.
Wondering Where Your Power Comes From?
When you flip on the lights or turn on your furnace, do you ever stop to wonder about where the electricity that powers your daily life comes from? Most people assume that almost all of our power comes from the big hydroelectric dams on the Columbia and Snake rivers. While that may have been the case 40 or 50 years ago, growth in the Northwest has created the need for additional sources of energy to complement the output from the dams. Now less than half of Oregon’s electricity comes from hydropower. Legal decisions regarding how the Bonneville Power Administration (BPA) distributes power from the dams also mean that PGE and Pacific Power customers actually receive very little energy from the federal hydro system. So, if our energy isn’t coming from the dams, where is it being generated?
The Oregon Department of Energy (ODOE) is helping to answer that question with a great new visual tool that shows the fuel mix that powers Oregon. The state’s two largest utilities, PGE and Pacific Power, are broken out separately, so most users can see where the actual electricity that is flowing to their home came from. Also available are aggregate resource mix descriptions for the state as a whole and for consumer-owned utilities. All of this data is presented in a simple, user-friendly web page. There’s also an interactive map that shows where each power plant, dam, wind farm, or other resource is located. Tools like this one can go a long way in helping Oregonians understand the environmental impact of their energy usage, as well as the claims that are made in utility advertisements.
If you’re unhappy that a big chunk of your electricity comes from coal-fired power plants (for PGE, it’s 26%; for Pacific Power, it’s 66%), there are a few programs that help customers increase the amount of renewable energy used by their utility. PGE’s Green Source program ensures that all of the electricity you purchase each month is offset by renewable energy sources (a blend of low-impact hydro, wind, geothermal, and biomass). This program adds about $9 to the average customer’s monthly bill. PGE’s Clean Wind program enables customers to purchase wind power in 200 kWh increments at $3.50 apiece. I personally buy three units each month, which averages out over the year to completely offsetmy entire annual electricity usage.
Pacific Power customers can enroll in the Blue Sky renewable energy program, which offsets electricity purchases with wind energy. Customers can purchase 100 kWh increments for $1.95 each, or can opt to have their entire bill offset in a manner that mirrors PGE’s Green Source program. A number of consumer-owned utilities in Oregon, including EWEB and Emerald PUD, also offer options that allow customers to purchase a greener mix of electricity.
Although none of these programs will ensure that the actual electrons that flow through the power lines to your house were generated with renewable energy, they do ensure that the total dollars customers spend on these programs go towards the purchase of new renewable energy projects above and beyond what is required by Oregon’s Renewable Portfolio Standard. That means each block of energy you buy ensures that an equivalent amount of energy from coal is not being produced for your utility’s system. All of these programs are audited by the Oregon Public Utility Commission each year to ensure that the utilities are giving them the proper accounting treatment and honoring their renewable purchasing obligations. Even though Oregon is a long way from having most of our energy provided by renewable sources, these programs are helping to move us closer to that goal.
Shale Gas Update: EPA links fracking, groundwater contamination
We noted in our post on December 2nd that EPA has begun a national study on the impacts of fracking on drinking water and that the results of that study would likely be sometime in coming. Nothing has changed in that regard. However, EPA also began a much smaller study in Wyoming some time ago and, in the days since our blog post, has released a draft of their findings (PDF) in this more localized study.
It should be noted at the outset that the results of the investigation are preliminary, have yet to undergo peer review, and apply only to Pavillion, WY. Nevertheless, the findings are significant in that they appear to corroborate what environmentalists have long feared: Given the right circumstances, chemicals from fracking fluid can and do make their way into drinking water. The findings, as summarized in the press release are unequivocal:
“Chemicals detected in the most recent samples are consistent with those identified in earlier EPA samples and include methane, other petroleum hydrocarbons and other chemical compounds. The presence of these compounds is consistent with migration from areas of gas production. Detections in drinking water wells are generally below established health and safety standards. In the fall of 2010, the U.S. Department of Health and Human Services’ Agency for Toxic Substances and Disease Registry reviewed EPA’s data and recommended that affected well owners take several precautionary steps, including using alternate sources of water for drinking and cooking, and ventilation when showering. Those recommendations remain in place and Encana has been funding the provision of alternate water supplies.”
Needless to say, the gas industry is not pleased with the EPA’s findings. Canadian gas giant Encana (owner of the wells covered in the study) had the following to say in response: “These preliminary conclusions do not stand up to the rigor of a non-partisan, scientific-based review […]” and “[c]onclusions drawn by the EPA are irresponsible given the limited number of sampling events on the EPA deep wells and the number of anomalies seen in the data.”
While the company is correct that the findings are not conclusive, they are likely to provide more fuel for the growing debate about the real environmental costs of shale gas extraction in the U.S and, so far, the science has not been tipping the scales in the industry’s favor.
My CUB Law Clerk Experience
It is hard to believe that a little over four years ago, I was making my way from Texas to the great Northwest to learn how to “defend dirt,” as my father would teasingly say, at the University of Oregon School of Law. Having gotten a big dose of energy, environmental and consumer law and policy during an internship with Public Citizen’s Texas office, studying environmental law with an emphasis on energy was the next logical step for me. It was not long after that that I began hearing about CUB.
Given the remarkable work that CUB does in the name of residential consumers of Oregon’s investor-owned utilities I kept my eye on any opportunities that CUB made available to law students and new attorneys. I could not have been more excited, or felt more fortunate, to join CUB as a practicing attorney through CUB’s law clerk program this past June. It is hard to believe that I am already beginning my sixth month here with CUB—the old idiom “time flies when you’re having fun” is definitely applicable to my experience.
As you may already know, CUB is an organization rich in people and interests, and has an array of staff, interns, clerks, and volunteers that work to represent both the financial and environmental interests and values of its members and Oregon ratepayers. As an attorney in CUB’s law clerk program, most of the work I do relates to the regulation of Oregon’s investor-owned electric, gas, and telecommunications companies (IOUs).
The Public Utility Commission of Oregon (OPUC) is the agency in charge of regulating customer rates and services of Oregon’s IOUs. The OPUC has the obligation to ensure that customers receive safe and reliable utility services at fair and reasonable rates. CUB intervenes in regulatory proceedings as a matter of statutory right, meaning that CUB becomes a party to those proceedings so that it can ensure that the values of residential ratepayers are fully represented in front of the OPUC. Most folks are surprised to learn that cases in front of the OPUC share a lot of the same characteristics as cases in front of a judge in a courtroom. Most parties are represented by attorneys, who serve discovery, write motions, briefs and other legal documents, and unless the parties settle, participate in a hearing similar to a trial that you might see in a regular courtroom (without the jury, of course!).
CUB’s law clerk program gave me with the opportunity to dive into this process head first, providing hands-on, practical experience while making a difference in the name of Oregon residential ratepayers. Through its team of staff, interns, clerks, and volunteers, CUB has an immense wealth of knowledge, and I have been very fortunate to have been surrounded by people with a willingness to impart that knowledge to me, and to mentor me as a new lawyer. They also forced/cajoled/enticed me to get out of my chair and get to know Portland on foot – that is running – and have thus been responsible for not only expanding my knowledge but also for keeping me fit!
In my short time here at CUB, I have been to settlement conferences, OPUC workshops, administrative hearings, and observed Oregon’s legislature in session. I have completed research on some extremely interesting topics, ranging from shale gas production to the history behind Oregon’s laws protecting residential ratepayers and a whole host of other legal topics. I have drafted memoranda, motions, petitions, a brief, and now a blog post! I have had the opportunity to meet other attorneys, analysts, national and local experts, Commissioners, and other stakeholders in the field. In short, I have had the opportunity to sit in the room with, and soak up the knowledge of, some of the brightest minds on energy law and policy in Oregon, the Pacific Northwest, and arguably the country.
The experiences and knowledge that I have gained have been truly invaluable both personally and professionally. CUB’s law clerk program provides its participants with a truly unique experience—no other organization offers the same opportunities and hands-on experience. But perhaps most importantly, my experience with CUB has provided me with the ability to make a difference in the lives of Oregonians. I could not be more thankful for the experience that I have gained with CUB. It is truly great that CUB has both the desire and the ability to provide such a valuable law clerk program.
Please visit our law clerk page for more information about becoming a law clerk at CUB!
Utility Consumer Advocates Gather In St. Louis
I recently traveled to St. Louis for the Annual meeting of National Association of Utility Consumer Advocates (NASUCA). The meeting brings together people who work on behalf of utility customers from around the country, and now that I am back in my beloved home state, I’d like to share some impressions.
Many folks may not know that there is a national organization that connects all the disparate consumer advocate groups throughout the United States. But there is. NASUCA helps utility consumer advocates trade experiences, work together on broad issues, and project our concerns into national policy discussions at the Federal Energy Regulatory Commission (FERC), the Federal Communications Commission (FCC) and the United States Congress. The annual meeting allows us to share information, attend workshops and conduct Association business (elect officers, approve a budget and set policy). The annual meeting is held in conjunction with the National Association of Regulatory Utility Commissioners (NARUC), the national body of commissioners including our own from the Oregon Public Utility Commission. Shared sessions allow open debate and dialogue among advocates ad regulators from all over the United States.
Utility consumer advocates exist in most states. In Wisconsin, Illinois and Oregon, utility consumers are represented by non-profit Citizens’ Utility Boards. In most other states, it is a section of State government, such as the Attorney General’s Office or an Office of Public Advocate that represent customers. Sharing our experiences, from both the non-profit sector and the governmental sector, help us all to do a better job of representing customers in the many issues that we face today, including low-income support, renewable power integration, Smart Grid investments, and many others.
I appreciate Oregon whenever I attend these kinds of events for a lot of reasons.
1. While we at CUB don’t always agree with all the decisions made by the Oregon PUC, Oregon has a tradition of smart, fair regulators. In a lot of other states, regulators are political cronies of the governor and have little independence.
2. As an independent non-profit, CUB has a lot of flexibility, and can intervene on a broad set of issues on behalf of ratepayers and, broadly, Oregonians. The Ohio Governor, at the urging of natural gas marketers, recently proposed cutting the budget of the Ohio Consumers’ Council by more than 50%. In Oregon, we don’t have to worry about political attacks on our budget when the positions we take offend a powerful interest group. The New Jersey Consumer Advocate attended the meeting for the first time in several years because the State Government had previously restricted non-essential out-of-state travel for state employees. Here in Oregon, your Citizens’ Utility Board can represent you on regulatory, legislative, and policy matters without our work being subject to political attacks or bureaucratic policies.
3. We have the Energy Trust of Oregon (ETO), our independent non-profit that runs energy efficiency programs for electric and gas utilities in Oregon. A lot of states continue to grapple with establishing good energy efficiency programs, and many look to Oregon and the success we’ve had with the ETO. CUB helped establish the Energy Trust of Oregon 10 years ago, because utilities have an inherent conflict of interest when it comes to encouraging customers to use less of their product. Most states cannot overcome the opposition from utilities to establish an independent non-profit model. But the consumer advocates who have looked at energy efficiency programs recognize that establishing a trust to support energy efficiency investments is the best model for consumers and for increased energy efficiency measures.
4. Finally, I am glad that we did not go down the path of deregulation when Enron proposed it more than a decade ago. States that deregulated have seen significant rate increases. Currently, several Northeastern deregulated states are worried that blackouts are coming because no new peaking capacity is being built. At least two states are looking towards state government to ensure that additional capacity is built, because the deregulated market is failing.
There are a set of issues that all states are facing.
1. We need to figure out ways to keep the heat on during the longest and deepest recession in decades. Here in Oregon, we saw 27,000 residential shut-offs in the first half of the year due to non-payment. Now, in December, freezing weather has rolling in throughout the state and we’re very concerned with keeping Oregon families warm. But this is not true only of Oregon: throughout the country, states are seeing record numbers of customers struggling with payment of this most basic need. Consumer advocates, federal, state, and local government, and the utilities need to work together to support our communities in this period of recession.
2. Even as we struggle with keeping the power on, we must continue to look to the future. Smart Grid investments and electric vehicles are two key components of facing the real challenge of climate change and addressing energy security concerns here in Oregon and throughout the country. Smart Grid, as we here at CUB discussed at our conference in October, has great potential to benefit utilities, customers, and the region—if implemented correctly. We see the same conversation happening in other states, which tells us there is still work to be done to establish the right policies for Smart Grid investments. And electric vehicles—now coming on to the market in greater numbers than ever before—have the potential to provide a marked impact on greenhouse gas emissions within the transportation sector, and a demand resource that could be matched with wind production at night. Electric vehicles are already here, and making intelligent decisions now about how best to integrate and support their use will benefit the grid as a whole in the long run.
3. Here in Oregon, we can look to the closure of PGE’s Boardman coal plant as a way to understand that with utilities facing huge costs in order to meet clean air requirements, the cheapest option may be phasing out some coal plants. But throughout the country, such action is still only being discussed. We have an opportunity at the national level to push for the retirement of coal plants, and replace them with renewable resource mixes that can address climate change and energy independence in our country. And here in Oregon, we found a way to get a discussion started: by asking if it’s more expensive to keep a coal plant in operation when you have to invest millions of dollars in technology to meet clean air regulation, or more economical to close a coal plant and replace it with cleaner resources. This question needs to be asked in states throughout the country to meet the costs and concerns of our clean future.
Meeting with my colleagues and peers at NASUCA this year, I believe there is the potential to address many of these challenges. But we need to keep talking, and continue to hold the utilities accountable to their customers and to the regulations we have placed on them. Here in Oregon, your CUB will keep doing exactly that for you. And we are grateful for the opportunity we have to share our successes with our counterparts in the rest of the country.
Natural Gas Update: Technology and Regulatory Advances
Back in July, we wrote about the proliferation of shale gas extraction in the United States. Our conclusion was simple: because this rapid growth is likely to continue and there are significant environmental risks associated with extracting the gas, thorough studies and an open and frank dialogue involving all stakeholders are essential. None of that has changed, but there have been several developments since July that justify revisiting this topic.
New Technologies are Coming
A number of new and interesting technologies are in the works. Examples include: self-healing pipes that use nanotechnology to repair minor leaks without human intervention, smarter Pipeline Integrity Gauges (”PIGs”), and backhoes with GPS units programmed with the location of major gas lines to prevent the machine from operating when it is too close to a line.
Unfortunately, we have seen few new technologies related to fracking specifically. There has been some discussion of waterless fracking technology at the recent World Shale Gas Conference in Texas and in other forums, but the technology hasn’t seen a great deal of testing in the U.S. The process is not an alternative to fracking; rather, it involves pumping butane in to the earth rather than water. The advantage is that the butane allows for higher pressures, meaning less is used, and most of it can be easily recaptured. But it is almost certain the technology will not be appropriate in all shale formations, suggesting varied geological conditions may ultimately limit its use. So, while there is room for optimism, the jury is still out on this technology.
Regulatory Change is Happening
The regulatory framework for dealing with fracking remains something of a patchwork quilt, as it varies widely from state to state. We have yet to see any comprehensive federal legislation on the subject. In fact, the federal government has surprisingly limited authority over these activities as they are generally exempted from most relevant environmental laws in this country. There have been periodic attempts to push legislation through at the federal level, but they have been largely unsuccessful, and it’s not clear that this is likely to change any time soon.
At the state level, however, there have been some noteworthy changes. Perhaps most significant is increased adoption of chemical disclosure laws requiring gas companies provide greater detail about what they are pumping in the ground. Most recent in the trend of state disclosure laws is that of Oregon’s neighbor to the east. On Nov. 15, Idaho’s Oil and Gas Conservation Commission approved fracking chemical disclosure rules that will take effect in 2012, presuming the Idaho Legislature does not reject them.
However, such laws have not come without controversy, as some gas-rich states have been reluctant to pass such legislation; or, in the case of Wyoming, and possibly Idaho as well, have watered legislation down by allowing so many exceptions (in the name of protecting trade secrets) as to swallow the rule. For more detail on these and other changes, take a look at the fairly comprehensive snapshot of the current legislative and regulatory trends for hydraulic fracturing put out by Marten Law in October.
The Science is Advancing
We have seen some movement toward better science from the federal government. For example, the Department of Energy (DOE), through the Secretary of Energy Advisory Board, released a report (PDF) in August which calls for more “cradle-to-grave” assessment of the greenhouse gas footprint of natural gas. More significantly, the EPA has announced a “Plan to Study the Potential Impacts of Hydraulic Fracturing on Drinking Water Resources” (PDF), though it will likely be quite some time before the results are available.
University-lead study is moving along at a better pace. In May, scholars at Duke University’s Nicholas School of the Environment published the first peer-reviewed study establishing a link between shale gas fracking and drinking water contamination. The study looked specifically at wells in Pennsylvania and New York, and concluded that elevated levels of methane in the drinking water near fracking sites did in fact carry the chemical signature of the gas from the wells. The study did not find any clear indications of chemicals from fracking fluid in the drinking water. However, the study’s authors are already at work broadening the scope of the research and collecting more data to better assess these and other risks.
What’s Happening in Oregon
If you haven’t heard much about fracking in the local news, it’s because there just isn’t much of it going on here in Oregon. We have the Nehalem Basin, which contains the Mist Gas Field, but it’s used primarily for gas storage and, because it is a sandstone formation, the few producing wells there have not required fracking.
Oregon also has relatively modest potential for gas extraction in the Coos Bay Basin on the state’s southern coast. This gas is coal bed methane (a natural gas that is a byproduct of some coal deposits) and it generally does require fracking. In fact, at least nine wells in the basin were fracked several years ago. As noted in a recent OPB article that basin still holds some promise for development and initial developer estimates called for as many as 300 wells in the area. And a CUB reader wrote in to alert us to the fact that there may have been some fairly recent interest in the project. Oregon residents have good cause to stay on top of issues in fracking, and we’ll make sure the information remains available to you.
Engaging Topics Outside of the Energy Field
On November 19th, CUB had the pleasure of a visit and briefing from Josh Vincent of the Northwest Center for Alternatives to Pesticides (NCAP). NCAP has been working for almost 35 years to protect community and environmental health by reducing pesticide use in the region and promoting environmentally friendly solutions to pest-related issues. The briefing represents CUB’s effort to understand other organizations and areas of environmental advocacy that often don’t enter our day to day work. Catriona McCracken, CUB’s General Counsel and Regulatory Program Director, is a former NCAP Board Member, and believes they are an inspiring organization with a rich history of success and strong collaboration.
Josh gave a very comprehensive history of NCAP from its origination in 1977 to its diverse slate of program areas that they work in today. NCAP started with 17 Northwest community groups to counter damaging pesticide use, and their first victory came in response to aerial herbicide spraying that was used on clear cuts to limited understory growth. Rural communities and 50 member groups led the effort to question this methodology, which used the herbicide 2,4,5-T – a component of Agent Orange. After many lawsuits, including ones held in Eugene by the EPA that included testimonials from Oregonians affected by the spraying, the EPA officially suspended forestry uses of 2,4,5-T on all public lands.
NCAP now has three major program areas – urban areas, agriculture and policy – and serves as a regional umbrella organization that supports a number of smaller groups throughout the Northwest. The long list of accomplishments that NCAP has seen over the years is worth checking out on their website, which also offers helpful toolboxes for homes, communities and professionals as well as many additional resources.
Something that we here at CUB found really intriguing is the focus on pesticide use in urban areas. Agriculture accounts for 75% of all pesticide use and is a major focus for NCAP. But, as Josh pointed out, urban spaces, including public schools, parks and housing, have high pesticide use and susceptible populations. There are a number of projects in place that address pesticide reduction in these spaces. In Eugene, the Parks Department is running the Pesticide-Free Parks Program and currently has 7 designated pesticide-free parks. The program involves volunteer work parties from the community that participate in Weed Pulling Parties that include hard work and often a barbeque. Weeds are usually a result of poor soil health, and the program looks at ways to better the soil quality to reduce weed growth and reduce the need for intense weed management.
Another major focus of NCAP in the state is the Integrated Pest Management (IPM) requirement for public schools that was voted into law in 2009 and comes into effect this coming summer of 2012. Oregon State University has developed a system to rate schools on their IPM plans and is guiding schools on their IPM planning through the OSU School IPM Program. This is an important victory for urban health and protection of children in schools.
CUB is very thankful to Josh for his visit and for the important work that NCAP does to protect Oregon’s communities and environment. We look forward to following more NCAP victories in the future and will continue to talk with organizations that work to protect Oregonians and our environment.
Thankful for Fix-it Fairs
Over the weekend, CUB attended the 25th Annual Fix-It Fair at Ron Russell Middle School in SE Portland to let people know about CUB Connects. The City of Portland holds these fairs throughout the city in order to connect residents to information and community resources that can help them save money and be healthy at home. The fairs are free and open to the public.
Fix-it Fairs invite organizations to host a table and/or workshop that give attendees answers about:
— Water and Energy Savings,
— Home and personal Health,
— Financial wellness,
— And much more.
The middle school’s cafeteria was filled with organizations to be thankful for as winter approaches, including Solar Oregon, Multnomah Country Weatherization Project, Community Energy Works and many others. We were very excited to join these other organizations and share our own resources with community members. We talked to over 40 community members about using www.cubconnects.org to choose a phone and internet plan that works for their budget and needs. During difficult financial times, it’s important that people have access to information about the options available to them. This is very true for telecommunications services and other services as well.
The Fix-it Fair made us feel very thankful for organizations and programs that help low-income families with energy assistance as well as other projects that help people reduce energy and water usage in order to lower their utility bills.
There are a number of services available for families in need of energy assistance, such as Oregon HEAT, and in the Portland area Impact Northwest. Throughout the state, Community Action Partnerships works tirelessly and with few resources to help families make it through the winter, and in Portland the Community Energy Project holds workshops and provides resources to help folks conserve energy and weatherize their residences.
Oregon.gov also has a list of resources for meeting energy needs, including energy bill assistance and weatherization tools.
As the winter aggressively settles in, it’s important to take moments to feel grateful for the individuals and organizations that are working hard to keep homes warm and lit through the holidays into the New Year.
EV Roadmap 4: Reflections on a Gathering of EV Advocates
President Obama issued a bold challenge to the nation in his 2011 State of the Union address. After emphasizing the nation’s dangerous dependence on foreign oil and the ruinous impact of climate change, Obama called for the deployment of 1 million electric vehicles by 2015. Our president understands that, by utilizing locally-produced electricity (particularly if this is renewable power) and producing no direct emissions, electric vehicles can drastically transform our transportation system.
With a struggling economy and low consumer confidence, getting one million electric vehicles on the road in four years is a highly ambitious goal. Oregon’s goal, however, is even more ambitious in comparison. We intend to add 30,000 electric vehicles to our transportation mix; this is 60% higher than our pro rata share of the nation-wide goal (which is 12,000).
On November 2-3, the EV Roadmap 4, organized by Drive Oregon brought together electric vehicle stakeholders to learn about our state’s progress toward this aggressive goal and discuss the future steps that need to be taken, with a particular focus on consumer engagement. Utility Analyst Gordon Feighner and I attended, representing CUB’s dual roles consumer advocate and educator on energy issues.
So how is Oregon doing in its march to 30,000 electric vehicles? With just under 1,000 electric vehicles registered with the Oregon Department of Motor Vehicles (including electric bikes and conversions), there is a lot of work to be done—but that didn’t discourage attendees at the Roadmap. Speaking at the event, Charlie Allcock, Business Development Director at PGE, declared 2012 a “year of action” that could jumpstart electric vehicle adoption. He noted the importance of making consumers aware of the new technology through an “eyes and seats” strategy. Putting electric vehicles on the road for consumers to see and on the dealership lots for consumers to drive, he argued, is key for stronger deployment. Allcock also highlighted the crucial importance of convincing fleet managers to add electric vehicles to their stock and suggested upgrading fleets was perhaps the only way to meet Oregon’s lofty deployment goal.
Reaching out to the consumer was a prominent theme throughout the two day conference. The importance of consumer outreach and education was clearly illustrated during a real-time focus group of eight Portland-area residents. Their discussion, guided by a trained moderator, highlighted the lack of understanding around electric vehicle technology and products among the average citizen. When asked to guess the price of an electrical vehicle, one woman estimated the cost to be $75,000, which is considerably higher than the sticker price of a Chevy Volt ($40,000) and the Nissan Leaf ($35,000) . Several believed the maintenance costs to be very high even though most experts believe costs will be lower than automobiles now in the long run. Overall, participants tended to be open to the idea of electric cars, but stated they needed to more information about them before they would be willing to purchase one.
In a follow-up presentation, Nate Pinsley, from the social media marketing firm Purpose.com, offered advice on educating and engaging these consumers. He argued the push for electric vehicles must become a social movement, not merely an advertising or information campaign. Broadcasting a message to citizens is useful but, Pinsely argued, supporting interpersonal communication between people—mobilizing their energy and ideas—is more powerful and persuasive. One great example of this concept is the online forum created and managed by Leaf owners called MyNissanLeaf.com . Here, Leaf owners share their stories about using their Leaf-good and sometimes bad-and, in the process, also educate interested Leaf buyers.
Although consumer outreach projects are still developing, there are many projects in our state and across the country that are focusing on installing an electric vehicle charging infrastructure. Theoretically, a large network of charging options will reduce consumers’ “range anxiety”—the worry that an electric vehicle will run out of charge and the driver will be stranded—and purchase an electric vehicle. At the EV Roadmap, several presenters discussed the progress of these charging infrastructure projects.
Jim Franfort, from the Idaho National Lab, summarized the data gathered thus far by the EV Project , a multi-state, $100 million electric vehicle deployment project managed by ECOtality. Leafs and Volts enrolled in the program have so far traveled a total of 5 million miles and the analysis of their usage patterns yields important findings. On average, these cars are connected to charging stations for eight hours a day, typically overnight, but are only drawing a current into their batteries for two hours. This confirms predictions that most charging would occur at home. Additionally, the vehicles are being used to travel about 30 miles per day, which is well within the range of all electric vehicles currently on the market. This is evidence that can be used to counter “range anxiety.” The most interesting data point, from an energy perspective, is that our nation’s electrical grid will be able to handle an additional one million electrical cars plugging in, if the majority of drivers follow the typical usage pattern observed in the EV Project.
Closer to home, representatives from PGE, PSU, and the City of Portland discussed the planning process and lessons learned thus far from the Electric Avenue project on PSU’s downtown campus. Opened in September, Electric Avenue is an “urban showroom” of electric vehicle charging technology, featuring seven charging units from different manufacturers. Although some minor problems have surfaced in its first month of operation related to the site’s characteristics, Electric Avenue is a fantastic example of how municipalities, academic institutions, and the private industry can work together to support electric vehicle adoption.
Walking out of the conference on the last day, I overheard a participant observe how incredibly far the electric vehicle movement had come since the previous EV Roadmap, held in January. It will be interesting to see how the movement develops in the next months and what kinds of conversations happen at the next EV Roadmap. Will the infrastructure issue be replaced by discussions over what legal arrangements are necessary for charging station companies to operate in the public right-of-way? Will battery technology improve dramatically and more focus be given to vehicle-to-grid applications? We’ll all have to wait and see—and, in the meantime, keep checking back here for updates on what CUB is doing related to EV deployment in Oregon!
SPECIAL INVITATION: If you’re interested in learning more about electric vehicles, the benefits they can provide to our state, and what CUB is doing in relation to this topic, read on! SA Anders, Business Director of CUB, will be presenting TONIGHT on electric vehicles at the monthly meeting of the Association of Energy Service Professionals NW. It’s free and open to all.
Event Details:
November 16th, 5:30 PM
Ringler’s Pub (1332 West Burnside, Portland)
AESP NW event page
Oregon Connections Conference
In the last week of October, CUB staff headed up the Gorge to attend the 16th annual Oregon Connections Conference in Hood River. The conference focus was “Oregon Broadband: The Power of Adoption.” This day and a half long event was filled with enlightening discussion and helpful insight into the future of broadband in Oregon, the policies that may affect broadband both nationally and statewide, and the opportunities and barriers for moving forward with broadband deployment and adoption.
CUB Executive Director, Bob Jenks, participated in a panel about Broadband and the Oregon Universal Service Fund (OR-USF). Moderator Ed Parker, challenged the panelists with questions about the barriers, opportunities and ways to apply the OR-USF to broadband. Overall, the panelists were in agreement that some mechanism needs to be developed to promote broadband availability for all Oregonians. A recent FCC decision will affect the timeliness and manner in which national USF funds are allocated to support broadband deployment—which could potentially affect policies made at the state level.
To top off a great conference, Bob was honored by Oregon Connections as the “2011 Outstanding Telecommunications Advocate” for his tireless efforts defending basic service for Oregonians, his involvement in USF discussions and policy, and especially his advocacy which helped to create funding for an Oregon Telecommunications Consumer Information Center, now more fluently known as CUB Connects. CUB Connects helps Oregonians compare phone and internet services in their area while providing consumers addition information and support through the helpline and workshops.
To learn more about the USF and discussions taking place, check out our blog from earlier this month: Everything Old is New Again. The post gives a great overview of the concept of the USF, how CUB is involved and the discussion around USF reform here in Oregon. And stay tuned—CUB looks to have an update on these developments in the coming weeks as details emerge and analysis of the changes takes place.
CUB’s Electric Vehicle Project Charges Ahead
It has been over a month since I joined CUB to serve as the CUB Policy Center’s new Community Outreach Specialist on Electric Vehicles. It seems unreal that five weeks have gone by since I first walked through the doors of CUB’s office, straight from Union Station and carrying my luggage. In this short time, I’ve learned an incredible amount about energy regulation under the Public Utilities Commission, Smart Grid technologies, utility companies in Oregon, consumer advocacy, and, of course, electric vehicles. I’ve also had the opportunity learn about and observe the dynamic world of public policymaking, which I studied as an undergraduate student but have never experienced firsthand.
I’ve also expanded my knowledge of downtown Portland’s food carts, but that’s a topic for a different blog….
During my first two weeks at CUB, I dedicated myself to learning about EVs, with a focus on their deployment here in Oregon. I also had the amazing opportunity to meet with some of the important players in the EV discussion and observe policy-making first-hand. In my third week, I traveled with CUB Legal Intern Jeff Maslow to interview employees at Eugene’s two main electric consumer-owned utilities, EPUD and EWEB, about their companies’ plans concerning EVs. In my fourth week, CUB’s Utility Analyst, Gordon Feighner, and I observed a meeting of a policy working group focused on designing a road user fee system. On October 21st, at the CUB Policy Center’s Smart Grid Conference, I attended the panel on the deployment of EVs in Oregon, their integration with Smart Grid technologies, and unsolved barriers to adoption.
Learning directly from these key players has been my most valuable experience thus far, providing me useful and diverse insights into what’s happening in Oregon on EVs. It’s clear that many agencies and organizations in the state are doing as much as they can to encourage the spread of EVs; dozens of pilot projects, grants, and plans are in place to foster the fledging market. One of the most talked about programs is the federally-funded EV Project , which includes pilot projects in 7 states including Oregon. ECOtality, an EV charging infrastructure company granted federal money to manage the program, is partnering with the State of Oregon, various municipalities, and Nissan to install over 2,000 charging stations in Oregon by the end of the year. Data gathered from these stations will guide future infrastructure development. EPUD is promoting a similar program that will collect information about EV in-home charging to prepare for a future where EVs create a significant demand on their electric grid. CUB’s recent Smart Grid Conference, including an EV panel, where Barry Woods of Drive Oregon, Carol Dillon of Portland General Electric (PGE), and Amy Hillman of ECOtality discussed another project designed to gather data as well as illustrate to the general public what “filling up” in the future will look like. Known as “Electric Avenue” , the project features eight EV charging stations where EV owners can stop to charge their cars. This engaging demonstration site located on Portland State University’s downtown campus and is the result of a partnership between PGE, PSU, and the City of Portland.
The high level of collaboration among all the entities involved in these projects and policy discussions is very encouraging. Many leaders in government, private industry, and the non-profit sector want to see the growth of an EV transportation system and, although they are approaching this from different perspectives, are working together to make it possible. Considerable progress has been made in the past three years, in spite of a struggling economy.
Yet EVs are still facing several roadblocks. (No pun intended!) On the policy side, fair regulatory structures that will surround the charging infrastructure and road usage fee need to be finalized. Utilities must prepare for more EVs plugging into their grids and, as CUB argues, begin utilizing Smart Grid technology to make sure EVs are charged with renewable wind power, so they are truly clean, smart machines. Finally, from the consumer end, education and outreach need to be implemented more comprehensively to ensure individuals are aware of the benefits of EVs and combat myths.
Where does this project fit into all of this? As CUB’s Community Outreach Specialist, I will be bringing diverse stakeholders together around a shared vision of ensuring Oregon’s electric vehicle (EV) infrastructure maximizes the technology’s social and environmental benefits. With a set of common principles, we can approach policymakers, utilities, and auto manufacturers to make sure the EV deployment brings about a cleaner, safer, and more sustainable world.
I’ll also design an information campaign to inform Oregonians about EVs. Check back in the coming months on this blog for the unveiling of a detailed, easy-to-use website and an engaging blog documenting real EV owners’ stories. If you have any questions you’d like answered or topics you think are important to cover, let me know and I’ll do my best to incorporate it into these resources.
It’s clear that Oregon is on a journey towards a more sustainable future. Many Oregonians want to leave behind oil-addicted engines and coal-burning power plants and transition into a cleaner, greener society. With the deployment of EVs primarily charged by renewable energy, it will be possible to make that desire a reality. CUB, through my outreach project, is creating the necessary dialogue around important consumer and environmental issues so that we, as a state, can move toward that goal and be proud of what we create.
The Threat of Higher Heating Bills Can be Really Scary
We’ve been fortunate to have a beautiful autumn here in Oregon, and trick-or-treaters don’t have to trudge through snow like those in the Northeast. But the chill in the air is a reminder that winter is fast approaching, and with it higher heating bills.
As CUB’s executive director, Bob Jenks, recently wrote, there are a lot of families struggling to pay for their energy bills, with more than 27,000 households having their power shut off during the first half of 2011. While CUB always leads the fight to keep utility bills low for all Oregonians, we’re entering the season when the need for heat and electricity is vital—but assistance for these programs is rising drastically. Meeting these heating needs is a big challenge during a hard economic time when many families’ situations haven’t improved or have even worsened. We fear that many more families may face the risk of having their electricity or gas service shut off this winter..
Fortunately, there are a number of services available for families in need of energy assistance, such as Oregon HEAT, and in the Portland area Impact Northwest. Throughout the state, Community Action Partnership works tirelessly and with few resources to help families make it through the winter, and in Portland the Community Energy Project holds workshops and provides resources to help folks conserve energy and weatherize their residences. Oregon.gov also has a list of resources for meeting energy needs, including energy bill assistance and weatherization tools.
To find services in your area, 2-1-1 info is available to help and refer people to the proper programs that have immediate assistance available. Visit their website 211info.org, or dial 2-1-1 from your mobile or landline.
While the above programs may help residents reduce their current bills, other forms of assistance are available to help consumers reduce their consumption or to finance renovations that will help keep futures energy bills down. Two great examples are the Energy Trust of Oregon and Clean Energy Works Oregon. Check out their websites for information on getting a home energy audit and assistance financing home energy improvements or finding contractors who specialize in this type of work and who can help you take advantage of applicable rebates and tax incentives.
While we’re enjoying fall weather here for a few more weeks, it’s time to start thinking now about what the winter will bring.
Everything Old is New Again
On October 27 and 28, Hood River will be visited by a host of telecommunications industry and policy experts. The occasion is the Oregon Connections Telecommunications Conference, an annual gathering “to share ideas, experiences and knowledge about telecommunications.” This year’s theme seeks to “explore the importance and value of broadband telecommunications adoption and utilization for business, government, education, healthcare, public safety, communities and individuals.”
CUB executive director Bob Jenks will be on a panel discussing broadband (high-speed Internet connections) and the Oregon Universal Service Fund. The idea for universal service in telecommunications is an old one. Trying to figure out how it applies to modern telecom technologies like broadband is a new effort. Here’s a little exploration of the concept of universal service and why it’s still important.
What is Universal Service?
Universal service is a long standing goal of telecommunications policy. In the early days of phone service, promoting universal service was essential to the value of telephone service. Having a phone was not useful if other folks did not have phones. The value of everyone’s phone increased as phone service was extended to more and more communities. And as more communities received phone service, universal service focused on making sure that phone service was affordable for low-income and senior populations. By the 1990s, universal service was largely achieved. Phone service was available nearly everywhere at rates that were relatively affordable.
Congress, in the Telecommunications Act of 1996, laid out a vision of a more deregulated telecommunications system based on competition, rather than regulation. However, there was concern that this market approach could undermine universal service. Under a deregulated system, keeping rates low by averaging the cost between rural and urban communities may not be sustainable, but if rural areas raise the cost of service three-or-more-fold, it may be difficult for rural low income customers to maintain telecommunications service.
In a largely deregulated market, private companies often have incentives to focus provision of services only on those customers who have the most money or those who are the cheapest to serve. This means that lower-income customers and customers in more rural areas are at greater risk for lacking access to even the most basic telephone service.
What is the Universal Service Fund?
The Universal Service Fund (USF) is a system designed to address these and other issues related to ensuring universal service. The basic idea is that all telecom service providers contribute to a common fund that is then used to subsidize services in high-cost areas or target uses. Telecom providers are assessed a percentage of their revenue (primarily from interstate and international service) and most pass those charges on to customers, though they are under no obligation to do so. The contribution rate has more than doubled over the last decade, to around 15%, up from 7% back in 2001. Distributions from this fund may only be used in furtherance of the goals of universal service in four program areas: addressing high-cost service areas, making telecom service affordable to low-income consumers, strengthening service to rural health care providers and strengthening service to eligible schools and libraries.
Different states receive dramatically different amounts of this money, owing to differences in population and geography, as well as various political factors. In 2010, Oregon received total disbursements, across all four USF programs, amounting to about $95 million. For some perspective, Delaware received about $4 million, while California had disbursements of more than $616 million.
How is CUB involved with the USF?
CUB opposed the Telecommunications Act of 1996, but not because of the Universal Service provisions. CUB was concerned that parts of the Act, such as the prohibition on rate regulation of cable television monopolies, would cause rates to go up rapidly.
Today, any company that wishes to seek low income support for provision of Lifeline and or Linkup services in Oregon, through the Universal Service Fund, must first petition the Public Utility Commission of Oregon (PUC) to ensure that they are able and willing to abide by state laws and PUC regulations. This is primarily done through a docket wherein a given company petitions for status in Oregon as an Eligible Telecommunications Carrier (ETC) and Eligible Telecommunications Provider (ETP). If the company receives designation as an ETC or ETP the company can offer services such as prepaid wireless phone service, for which they may seek USF reimbursement.
CUB has a keen interest in the process of ensuring that USF money spent in Oregon is in fact used to the benefit of Oregon consumers. Alert readers may remember CUB’s involvement in this arena back in August of last year when Tracfone was applying for ETC status. Since then, no fewer than ten other companies have applied for, or are currently planning to apply for, ETC/ETP status in Oregon in hopes of claiming some of the USF money available here. CUB is actively involved in ensuring that any such applications are in the public interest with respect to the terms and services offered.
USF Reform: Applying Old Principles to New Challenges
Promoting access to and affordability of basic telephone service is widely recognized as an important societal goal. But just as our means of communication evolve, so must our goals and our views on “basic” or “essential” services. For example, fifteen years ago, the internet was a luxury and broadband internet, by today’s standards, really did not exist in any practical sense. Now many people consider internet service to be every bit as important as telephone service. And, with the advent and proliferation of VoIP, Skype and related technologies, the distinction between voice and data networks is disappearing. Nevertheless, large parts of the country remain without access to broadband internet and the US is lagging in its deployment of high-speed internet relative to other countries.
Hoping to get a better grasp on the problem, Oregon launched a broadband mapping project that is worth checking out, and a national map is available here.
Because of the above, the Federal Communications Commission (FCC) hopes to reform the USF. Specifically, the FCC plans to overhaul the fund to focus on expanding broadband. Precise plan details are still lacking but FCC Chairman Julius Genachowski is a proponent of universal broadband service. Indeed, the name of the fund would change from USF to the “Connect America Fund”. On October 6, 2011, the commission released an unofficial document, Genachowski Unveils ‘Connect America Fund’, that outlines the goals and elements of Genachowski’s plan.
While there is broad consensus that the changes will be significant and controversial, little else is known. Chairman Genachowski has made public comments suggesting that the reform will not mean an increased burden for customers. But, officials within his agency have anonymously suggested the opposite may occur. As usual, beneficiaries such as low-income customers, have the most to lose.
Notwithstanding the above, if done in the right way, CUB supports including broadband within a USF reform effort. This is because we live in the day and age where access to broadband internet service is becoming a fundamental public utility, like phone, electricity and water. But CUB recognizes that the devil is always in the details and the FCC is often subject to influence by the big telecommunications companies. CUB will be keeping a close eye on this as it develops.
Smart Grid Conference a Smash Hit!
On Friday, October 21st, CUB Policy Center, with the support of the University of Oregon. and many others, hosted its inaugural policy conference: Smart Grid: Today’s Regulation and Tomorrow’s Technology .The university’s high efficiency White Stag Block in downtown Portland was jam packed with energy lawyers, utility professionals, smart grid advocates, regulators, and others all energized to discuss smart grid opportunities, barriers, and polices for the Pacific Northwest.
Susan Ackerman, Commissioner - Oregon Public Utility Commission, delivered a stirring breakfast keynote adroitly setting the stage for the rest of the day. Bob Jenks, Executive Director of CUB, followed Commissioner Ackerman to the podium and delivered a thoughtful presentation on utility regulation in Oregon and the Pacific Northwest and gave specific examples of how Smart Grid, if done properly, can change the way individuals, homes and businesses interact with the electrical grid, and use and store energy. Bob emphasized that Smart Grid technologies can be incorporated without making radical changes to Oregon’s energy laws and regulations. Most importantly, Bob noted that CUB is a supporter of the move towards a Smarter Grid. CUB just wants to make sure that any changes make the electrical grid better for all consumers and that no consumers get left behind – the Smart Grid needs to be implemented in a fair and reasonable manner resulting in fair and reasonable rates for consumers.
Bob’s presentation was followed by a panel discussion that provided the audience with many and varied views on regulation and Smart Grid and kept the audience actively engaged; many great questions came from the audience Q and A.
Following a short break everyone enjoyed a delicious lunch provided by Eat Your Heart Out catering during which we listened to a spirited lunch keynote address by former FERC Commissioner and founder of ESPY Solutions, Nora Brownwell. Nora’s presentation, which was both funny and challenging, informed the conversation by providing conference attendees with a national regulatory and business applications perspective.
With hungers sated and brains powered, participants attended the afternoon breakout sessions: Electric Vehicles, Business Applications and Opportunities, Home Energy Management and Making Renewable Resources Work. Each of the panelists and moderators for these sessions were truly superb and all of the panels were extremely well attended. The audiences, again fully engaged, peppered the panelists with insightful questions!
The conference program ended with a closing panel that summarized the lessons learned from the conference and discussed how those lessons might be applied going forward. One of the major conclusions agreed on by panelists was that a unified vision for Smart Grid needs to be developed for the Pacific Northwest that considers all perspectives, opportunities and challenges. The day concluded with a very welcome reception and a special appearance by the current Chairman of the Federal Energy Regulatory Commission, Jon Wellinghoff.
This conference would not have been possible without the very generous support of our sponsors, and the time and dedication of our panelists and speakers. CUB is very grateful to everyone for their support of CUB’s inaugural conference and looks forward to continuing the Smart Grid discussion.
Special thanks to Ninkasi Brewing Co and Mountain Peoples Organic Wine and Beer Distribution for supporting the networking and mingling skills of our staff, attendees, panelists and sponsors.
CUB is truly thrilled with the level of engagement and the thoughtful conversations generated by the conference. It is a wonderful day when we can say that the conference fulfilled its mission – active informed discussion, by a wide variety of stakeholders, of the important topics surrounding the implementation of the Smart Grid!
Please visit the CUB Policy Center website for a complete agenda including topics, speakers and sponsors.
Making Policy as if People Mattered
In September, I wrote a letter to CUB members (pg. 2) describing the disconnect between real people’s lives and discussions amongst policy makers. Last year, in 2010, the Community Action Partnership of Oregon reported helping over 29,000 PGE and Pacific Power customers with energy assistance from ratepayer-generated funds, helping to prevent shut-offs.
That was last year. Now, utility shut-offs are up more than 30% this year over last year. The three for-profit electric companies in Oregon (PGE, Pacific Power and Idaho Power) have shut off more than 27,000 households for nonpayment during the first half of 2011. This means people are living in their homes – at least for a time – without heat, refrigeration or lights. At the same time, state regulators are talking about increasing winter heating and cooling costs in order to send “price signals” to customers.
Something has happened in 2011. Whether it relates to the end of unemployment benefits, the disappearing safety net for many families or other factors, it is clear that families who were hanging on by their fingernails are now forced to let go and fall.
Here at CUB, we wondered: where is the concern? Where is the indignation? Where is the anger that many Oregonians are also in danger of the same thing happening to them? It often seems that utilities, regulators, and government officials are doing little to address these real, sobering issues—or even acknowledge them.
A few days after writing that letter for our newsletter, the Occupy Portland protest began with a march that went right by our office. I looked out my window and saw people stretching from Pioneer Courthouse Square to Burnside and beyond – well over 10 blocks. There were thousands of people walking down SW Broadway (police estimates put the number around 3,000-4,000) demanding that the interests of the “99%” be taken up by our political leaders.
I went down to Pioneer Courthouse Square to mingle among the protesters. Here were people of all ages standing up for the struggle that real Oregon families are having.
I found the indignation and the anger: it was here.
A few days later, the Oregonian printed a story about the increase in applications for food stamps for Oregon families. And they noted the same trend that we here at CUB have: 2011 is different. While unemployment may have fallen slightly, families who have been struggling in this Great Recession are now falling through the cracks.
And our political and government institutions are not responding. They’re often not even paying attention! We see this in our area of public policy. Congress cut funding for low income heating assistance while thousands of families are living without heat. The Oregon Public Utility Commission talks about increasing price signals to these same customers. Other policymakers are talking about increasing the cost of energy efficiency programs by 50%, so utilities can add to their profit margins without saving a single additional kilowatt hour of electricity. NW Natural wants to increase its monthly customer charge to $25, requiring customers to pay even in the summer when they aren’t using gas.
The history of Occupy Portland and Occupy Wall Street is still being written. But the points being raised by the protesters are clear now: in a time of economic turmoil unknown for a generation or two, people need help. In the utilities field, we are also seeing unprecedented change along with need for investments in new, cleaner power sources and an infrastructure suited for the 21st century. But we can’t lose sight of the fact that all the investments that will be made will come mostly from the pockets of ordinary, everyday folks – many of whom are struggling right now. If we do forget that, we won’t see voluntary protesters camping out. We’ll see folks living in tents because they have no other choice.
The Business of Smart Grid
As we near the date of CUB’s inaugural policy conference, Smart Grid: Today’s Regulation and Tomorrow’s Technology, there’s one topic left to cover in our Smart Grid series here on our blog—Business Applications and Opportunities.
Much like residential customers, business customers have a number of tools and technologies available to control, conserve, and manage energy use. These products can scale up as needed to provide service for small businesses up to commercial and industrial businesses. But with the market for Smart Grid technologies as new as it is, there are dozens of options—from thermostat and environmental control devices to large scale load control devices that can operate on commercial freezers or water heaters. Choosing the right device, and understanding how to apply the information from that device, has a somewhat steep a learning curve.
There’s another element at play for the business customer as well: human behavior. From designing buildings that allow more natural light in offices rather than relying on track lighting, to adding basic weather stripping to doors within existing buildings to prevent drafts, there are many mechanisms business owners can put into place that affect the day to day operation of the facilities they use, and the behavior of the employees and customers within those facilities. The Smart Grid offers a lot of potential to create not just sustainable or efficient work spaces, but also workspaces that conserve and manage energy. By engaging with these tools and technologies, business owners can gain a significant amount of control over the energy consumption and conservation of their businesses and act as examples for the best practices of Smart Grid for businesses.
But are there barriers to adoption? While some Smart Grid investments are inexpensive and point to the correlation between energy efficiency measures and technological advances, others represent significant cost to the business customer. Until these technologies are implemented on a wider market, they represent a promise to their customers rather than proof of success. There are other concerns as well: what pricing structure, or structures, offers the best value to business customers—especially given the broad financial tiers of companies from small to commercial operations? What regulations best serve this customer class as the momentum behind Smart Grid increases?
We hope to answer some of these questions in our Business Applications and Opportunities panel at CUB’s inaugural policy conference on Smart Grid on October 21st, 2011. In partnership with the University of Oregon, Smart Grid: Today’s Regulation and Tomorrow’s Technology, wewill be devoting an afternoon panel session to discussing these questions and more with moderator Jeff Hammarlund of Portland State University; Pete Catching of the Energy Trust of Oregon; Robert Frisbee of the Oregon Sustainability Center; and Joe Barra of Portland General Electric.
We invite interested energy professionals to attend this conference to engage with us and our panelists on Smart Grid issues here in Oregon and the Pacific Northwest, but registration is limited and going quickly. Please visit the conference website for more information on how to register, space is limited.
Other posts in our series on Smart Grid: Why Smart Grid Advocates Should Learn About Utility Regulation, Electric Vehicles Continue to Emerge in Oregon, Thinking Smartly About Home Energy Management, and Renewable Power and the Smart Grid.
Impact NW Lives Up to Its Name with Its Energy Assistance Program
Last week, CUB staff had the opportunity to sit down with Tyler Richardson, the Energy Assistance Coordinator from Impact NW . Impact NW is a regional social service agency offering a diverse array of support services to vulnerable populations in the Multnomah, Clackamas, Washington, and Clark counties. Formerly Portland Impact, Impact NW has grown since its inception in 1966 to now serve 60,000 residents each year. Some of the services the non-profit provides include emergency housing assistance, a Healthy Start program for children ages 0-3, mentoring for teens, job-training programs, and energy assistance.
Richardson came to CUB to share information about the Energy Assistance program he manages, which keeps the lights, heat, and water on for thousands of low-income Oregonians struggling to pay their bills. To be granted assistance, a resident must contact the Regional Service Center in their area and set up an in-person, thirty minute interview with a staff member. At this meeting, the resident’s situation is discussed in detail and an amount of financial assistance is calculated. The amount distributed can vary widely depending upon the resident’s energy provider and the payment owed,. Over 6,000 households receive assistance each year through Impact NW’s program.
The need for energy assistance in the region is high and ever increasing, according to Richardson, who described how the weak economy and high unemployment is making it even more difficult for individuals to afford their energy bills. A 2010 report released by the Oregon Energy Coordinators illustrates the demand for assistance, analyzing data gathered from seventeen Community Action Agencies across the state. In one week in January 2010, they recorded 20,779 calls requesting some form of energy assistance. If averaged among the seventeen participating agencies, each agency took around 174 calls per day requesting aid.
According to this same report, only 26% of the total number of Oregon households eligible for assistance through the federally controlled Low Income Heating and Energy Assistance Program (LIHEAP) and statewide Oregon Energy Assistance Program (OEAP) are able to be served due to lack of funding. Similarly, Richardson stated that within Impact NW’s service territory, he estimates they are only able to serve one-third of eligible residents due to budget constraints. As another winter approaches, Richardson anticipates more requests for assistance and more frustration about having to turn people away, particularly those who so desperately need it.
Impact NW strives to help residents in the program lower their energy bills through energy efficiency education. In the past, Multnomah County provided energy saving kits that Impact NW distributed to program participants. Funding cuts, however, ended that giveaway program and now Impact NW administrators rely on the brief time during the assessment interview to teach residents simple tricks to conserve energy and encourage them to seek additional resources from other community agencies.
The direct service to residents that Impact NW offers is intimately connected to the regulatory work of CUB. We work tirelessly to prevent Oregonians from being subjected to unnecessary and unfair rate increases for their energy use. If residents are still unable to afford their energy bills, Impact NW acts as a safety net, catching them before their electricity or heat is shut off. Although working from different sides of the equation, CUB and Impact NW are both trying to make sure that all Oregonians are warm and safe in their homes.
CUB Attends Annual Dinner and Auction for Oregon HEAT
On October 1st, CUB attended the Annual Dinner and Auction of Oregon HEAT, a non-profit organization that, like CUB, is dedicated to protecting the Oregon consumer, particularly those with limited resources. The rainy and cold weather was appropriate considering that Oregon HEAT’s central mission is to prevent that typical Oregon weather from impacting lower-income families who struggle to pay the bills keeping their heat and lights on. Through the generosity of its donors and strong community partnerships, Oregon HEAT provides financial assistance to these individuals to help them cover those costs, ensuring their houses stay warm and lit. The organization also encourages energy self-reliance through offering energy conservation education. In 2010 alone, Oregon HEAT helped over 15,000 individuals with emergency energy assistance.
At the benefit event, supporters and partnering organizations gathered together at the Crown Plaza Hotel to celebrate the positive impact of Oregon HEAT and contribute funds to continue its vital work. The ballroom hummed with the animated conversation and laughter of over 170 people as dinner began. Oregon HEAT executive director Roger Rees took to the stage after the meal, to welcome all the attendees and introduce Marc Farmer, president of presenting sponsor West Oregon Electric Cooperative. Farmer highlighted the success of Oregon HEAT’s oil recycling program, which began in 2007. Oregon HEAT partners with the Oil Re-Refining Company to collect used oil from businesses, organizations, and individuals and re-refine it back into a usable form. Funds generated from the sale of the “new” oil go to provide energy assistance to families in need.
Native Oregonian and nationally acclaimed comedian Dave Anderson then took the microphone. After mercilessly poking fun at the audience members and himself, Anderson invited retired Gresham police chief and auctioneer Carla Piluso to join him on the stage to lead the auction. As she opened the bidding, the energy in the room rose. Bidders were generous with their offers, knowing that 90 cents of every dollar they donated to Oregon HEAT will go directly to households qualifying for assistance. An Italian dinner for eight people, cooked and served by Piluso in her home, sold for over 400 dollars!
The final amount of funds raised at this event will soon be released on Oregon HEAT’s blog . Check out their blog and website for more information on their organization and consider supporting Oregon Heat’s great work and help keep everyone warm this winter.
CUB was delighted to attend the event and commends Oregon HEAT for another year of supporting lower-income families and individuals who require energy assistance and encouraging efficient energy usage. In these challenging economic times, organizations like Oregon HEAT are needed more than ever.
Oregon’s Incentives on Energy Efficient Appliances Set to Expire
During the summer, CUB Organizing Director Jeff Bissonnette posted an overview of the 2011 legislative session. Jeff reported that energy efficiency tax credits were mostly preserved under HB 3672, but also noted some changes. One of these changes is that the incentive for purchasing energy efficient appliances is about to expire for Oregon residents. The Residential Energy Tax Credit (RETC) provides state income tax credits for purchases of qualified home appliances. Earlier this year the state legislature, in an effort to reduce the costs of the program, implemented a number of changes that will take effect on January 1, 2012. The most prominent change is the elimination of tax credits for dishwashers, refrigerators, and clothes washers. These incentives range from $60 to $180 and will remain in effect until the end of the year.
While the Energy Trust of Oregon will continue to provide cash-back incentives for the purchase of qualified appliances, the upcoming changes to the RETC mean that now is a good time to replace old, inefficient appliances before the credit goes away. The Oregon Department of Energy has lists of qualified models of dishwashers, refrigerators, and clothes washers that are eligible for the tax credit. These incentives, when combined with the significant reduction in electricity used by the new appliances, essentially eliminate the price differential between inexpensive low-efficiency appliances and more expensive efficient ones.
The changes to the RETC don’t affect the incentives for electric and alternative fuel vehicles, solar energy systems, water heaters, furnaces, or other heating systems. Also, even if you do not have any tax liability for Oregon state income taxes, you can pass the savings on to any other Oregon resident with tax liability. The Department of Energy website has detailed instructions on how to share the tax credit here. January 1st is right around the corner—start thinking about applying for the RETC now!
Thinking Smartly About Home Energy Management
We’ve all welcomed new gadgets into our homes over the years that have promised to make our lives better. Advances in web-based technology have brought automation and ease to household chores like paying the bills, and smart phones have exponentially expanded the ways in which we use our mobile phones. An emerging line of technologies now combines the power of wireless internet and automated multi-tasking to offer energy-saving potential for your residence that can make life a little easier and save money in the process. More importantly, these technologies can provide a real-time answer to the burning question on the minds of many Oregonians: “Why is the energy bill so high?”
Home energy management systems allow residential customers to manage and control their home energy usage profile by utilizing small control units known as energy dashboards, programmable thermostats with wireless connections, and “smarter” appliances. Customer-empowering technologies like these now make home energy management and its resulting cost savings fun and interactive. An array of these systems has already arrived at local electronics retailers in Oregon.
Examples of home energy management systems currently available on the market include wireless programmable thermostats bundled with sockets and strips for plug-in appliances that the customer desires to control. A dashboard panel, often in the form of a touch screen display, allows for the customer to establish pre-set schedules to create settings for day, nighttime, and away periods. The wireless capabilities of various programmable thermostats on the market enable customers to communicate with the home energy system via the web or smart phone and make the desired adjustments on the fly.
The guiding principle behind energy management systems is customer empowerment. The goal is to provide the customer with the ability to micromanage every aspect of home energy use. The technology provides detailed knowledge of the home energy profile from the energy used by individual appliances, from the household refrigerator to the flat screen TV. A real-time display can allow customers to view the energy consumption of various appliances and reduce energy use according to their habits, such as programming a thermostat temperature or directing appliances to power down at night. The end result is a new level of transparency for energy consupmtion, which can result in an estimated 10-15% in additional energy savings from enhancing customer control alone. The customer sees precisely what goes into their energy bill well before it arrives in the mail.
Automated energy management has also emerged as the central feature of many home energy management systems. Several companies have partnered with utilities on pilot projects to implement services that automatically manage electricity use based on weather patterns and home energy use patterns for upcoming days for a relatively low monthly fee. These pilots have achieved an average of 20–30% in energy savings per home without any changes in customer comfort or behavior—savings that can be realized without requiring any deliberate action or thought from the customer. While not yet available everywhere, like many other customer-enabling energy management system technologies, this service has the potential to help customers realize the benefits of energy and cost savings and not having to worry about making adjustments later.
On October 21st, 2011, CUB will be hosting a conference in partnership with the University of Oregon called Smart Grid: Today’s Regulation and Tomorrow’s Technology. We’ll be devoting an afternoon panel session to discussing home energy management and the Smart Grid with Jeff Lyng of Opower, Pat Egan of PacifiCorp, and Josh Skov of Good Company. CUB’s Legal Counsel, Catriona McCracken, will be moderating, and we invite interested energy professionals to attend this conference. For more information, click here.
Energy management systems are an exciting movement in making the energy grid and residential distribution system smarter and more transparent. These advances can empower residential consumers to manage and control the electricity they use—and offer an informative leap toward managing high energy bills.
Other posts in our series on Smart Grid: Why Smart Grid Advocates Should Learn About Utility Regulation, Electric Vehicles Continue to Emerge in Oregon, and Renewable Power and the Smart Grid.
CUB Named One of Oregon’s 100 Best Non-Profit Companies to Work For
For the last three years, Oregon Business Magazine has expanded its 100 Best Companies to Work For award to include a special focus on the non-profit sector. Non-profits from around the state elect to be included, inviting their employees to take part in a survey. In October, these non-profits are invited to an evening event to celebrate the recognition our sector has received, network with other organizations from around the state, and learn what organization was ranked as a top non-profit to work for in the state of Oregon.
This year, the first that CUB has participated in this project, has resulted in our placement in the top 100 non-profit organizations to work for in 2011! There are three categories: small, medium, and large, based on the number of employees at an organization. CUB placed #19 out of 33 small non-profits.
This is a great honor, and CUB is very proud that we’ve fostered such a positive atmosphere as we work to promote the public interest and protect utility ratepayers every day. We share this honor with some of our partners on policy issues, such as the Oregon Environmental Council; energy and environmentally-friendly organizations like Friends of Trees, PECI, the Western Rivers Conservancy, Sustainable Northwest, League of Women Voters, and the Mid-Willamette Valley Community Action Agency; and other admirable non-profits such as Adelante Mujeres, the Macdonald Center, Full Access, Ronald McDonald House, Clackamas Women’s Services, Hacienda CDC, REACH Community Development, and more.
With nearly 400 people from the non-profit sector attending the celebration on September 28th, 2011, this project has a significant impact on the non-profit community in Oregon. CUB is honored to have placed so highly in our first year. We congratulate our colleagues and friends throughout the industry, and look forward to next year’s 100 Best Non-Profits to Work For program!
Electric Water Heater Potential Demands a Response
When a typical household consumes energy during the day, it is often an afterthought, done with little consideration of impacts of that use on the electrical grid. One household doesn’t really add that much load onto the grid. But when a large number of residential customers ramp up air conditioning or space heating at the same time, utilities must resort to costly generation sources often derived from fossil fuels to fulfill this demand. Peaks like these make energy more expensive for everyone.
To address these high costs, the Oregon Public Utility Commission (PUC) staff has entertained the notion of time-of-use (TOU) rates—raising rates during peak hours to deter electricity use and free up electricity in the system. To an economist, creating a price signal might make sense as a way to motivate customers to use more energy during off-peak hours. But what goes overlooked is how the overwhelming burden of paying for TOU rates falls on the shoulders of vulnerable and low income customers already struggling to pay their bills. TOU rates are a one-size-fits-all solution that ignores individual economic realities and the energy use patterns of many Oregon households. To learn more about CUB’s position, take a look at our blog about TOU rates from earlier this week after a hearing at the PUC.
As we discussed TOU rates, a familiar topic for those familiar with our Smart Grid series came up: how can emerging technology be used to address demand response issues related to high peak usage? After careful and considered research, we determined that load control technologies, such as devices places on electric water heaters or air conditioners, might be a good fit for managing and adapting to peak energy load.
The collective benefits of adjusting and adapting energy load are manifold: avoiding grid congestion and transmission build-outs, lowering the costs of purchasing additional fossil-fuel based generation resources, alleviating local distribution system issues, and balancing out the intermittencies of wind generation. In the cool Pacific Northwest where peak demand typically occurs in winter months, load control technologies that focus on how and when to heat water in the home promise to deliver these benefits without diminishing customer comfort or convenience. The technology is also quite simple. The utility installs a lunchbox-sized device onto water heaters that can make slight modifications to the temperature of the water heater. It does so by responding to a wireless signal that turns the heater on or off during pre-set or customized times. All customers have to do after setting personalized comfort parameters is forget about it and benefit from monthly credits to their energy bill.
The Emerald People’s Utility District (EPUD) in Eugene recently conducted the PowerSync pilot program, installing load control devices onto water heaters and programmable thermostats. EPUD sends out a wireless signal to shut water heaters on and off during high demand periods. The programmable thermostats empowered customers to establish more efficient parameters for heating and cooling their homes, and water heater load control devices freed up between 4-5 kwh of electricity from each participating home during peak power events. With wider implementation scheduled to reach across EPUD’s service territory, the program will help the community slow increasing pressure on rates from peak demand.
Due to the large number of electric water heaters here in Oregon—estimates range as high as over 2 million electric water heaters across the Pacific Northwest—there exists a very high energy saving and storage potential in home hot water storage appliances. By combining load control devices with either remote switches or existing home wireless/broadband connections, the residential water heater can serve a central role in freeing up multiple megawatts of electricity on the grid and shaving dollars off of customers’ energy bills without imposing any significant behavioral changes. Further, in a state where the on-again off-again availability of wind power often strains grid capacity, more advanced water heater technologies allow a utility to quickly signal water heaters to turn on when the time is ideal to store surplus wind power.
The ability for water heaters to absorb excess wind power is an intriguing fit for Oregon’s burgeoning renewable energy portfolio. Earlier this year, federal energy marketer and grid manager Bonneville Power Administration struggled to integrate wind power to the point where it had to reduce its wind power generation because the grid was overstressed by the increased hydroelectric power output from the spring run-off. Through the storage capabilities of a new generation of water heaters and load control devices, this problem could be solved by storing surplus wind power in the form of superheated water that is cooled to a safe temperature through a mixing valve before use. Likewise, utilities can adjust water heater temperature downward by few degrees during hours of peak demand. Thus, when an especially windy day turns the turbines at a wind facility near The Dalles, utilities may soon be able to synchronize water heaters to absorb some of this electricity at coastal residences in Astoria.
The proliferation of water heater load control technology serves as the cornerstone for a smarter electricity grid by virtue of two-way information sharing between the household and utility. Privacy concerns must be addressed by the PUC to ensure that energy use information is kept safe. Safety concerns, however minimal given the small number and low intensity of signals transmitted, must also be answered. These concerns, while valid, should not stymie the boundless potential for these technologies to keep rates low and source cleaner electricity into the home. They will pave the way for future mechanisms that store wind power in electric vehicle batteries during off-peak hours and provide electricity to draw from during peak demand events.
The energy and cost savings of these technologies are difficult to ignore, and the cost of implementation is reasonable. CUB believes water heater load control devices are now ripe for implementation by the state’s largest utilities without sacrificing customer privacy or convenience.
CUB Stands Up Against Time-of-Use Rate Proposal
On Tuesday, September 27, CUB Staff headed to Salem to provide commentary before the Public Utility Commission regarding the Commission Staff’s recent straw proposal for setting up an approval process for time-of-use (TOU) rates for electricity customers. This type of rate structure has a number of drawbacks for customers if it is made mandatory (read our previous post on the issue here). Joining CUB’s Executive Director, Bob Jenks, in testifying was CUB’s expert witness for this issue, Barbara Alexander. Mr. Jenks introduced Ms. Alexander as “a rock star in consumer advocacy circles,” and she lived up to her billing in providing compelling commentary that bolstered CUB’s case.
The hearing began with a clarification from the Commissioners and the docket’s administrative law judge of the intent of the straw proposal. It was not the intent of the Commissioners to compel electric utilities to seek approval for mandatory time-of-use rate structures for residential customers in the near future, which was CUB’s greatest concern with this docket. Instead, the Commissioners simply wanted to develop a framework for evaluating future proposals rather than address proposals as they come up in the context of general rate cases. The Commissioners also want utilities to investigate the potential costs, benefits, and concerns that would result from the implementation of TOU rates and other programs such as peak-time rebates (PTRs).
Barbara Alexander opened CUB’s commentary in the proceeding by challenging the Commission’s focus on price signals. She stated that electricity is an inelastic good, so increasing prices at different times of the day or year will primarily result in higher bills for customers without much reduction in electricity consumption. If the goal of having smart meters and other advanced infrastructure, she continued, is to help reduce capacity demands on the grid and reduce costs, then the Commission should help utilities develop programs that can be proven to meet these objectives rather than express a preference for TOU rates. Programs Ms. Alexander suggested the Commission focus on include PTR programs that reward customers for cutting electricity usage during peak load times and direct load control programs where utilities can directly control household appliances, such as water heaters, to shift energy usage away from peak times. She related a story from her home state of Maine, where TOU rates implemented in the 1980s prompted a customer revolt that led to a quick shift away from mandatory programs for residential customers.
Bob Jenks also offered some commentary on the issue, expressing CUB’s concerns regarding TOU and seasonal rates, as well as critical peak pricing programs. All of these programs, he said, essentially penalize customers while providing little benefit to the utility. Many customers are unable to shift their electricity usage away from peak hours or improve the efficiency of their homes, so these customers would suffer from increased prices under TOU or seasonal rate structures. Mr. Jenks recommended that the Commissioners get rid of the idea of mandatory TOU rates once and for all so that the Commission Staff can focus its energy on other programs that are more equitable and have greater potential for energy savings.
Other parties that went on record as opposing mandatory or large-scale implementation of TOU rates included PGE, Pacific Power, and the Industrial Customers of Northwest Utilities (ICNU). Only Idaho Power and the Commission Staff expressed a favorable attitude towards TOU rates, and neither party explicitly favored a mandatory TOU rate structure at this time. Commissioner Susan Ackerman again reiterated that the Commission has no intention of making TOU rates mandatory for customers, and that any change in rate structures will need to be accompanied by significant consumer education efforts.
CUB will continue to monitor this issue closely, and we’ll certainly post an update on this blog when the Commission issues its final order in this docket in the coming months. If you are interested in reading more of what CUB has to say on this issue, you can find the written comments of Bob Jenks and Barbara Alexander on the PUC website.
Renewable Power and the Smart Grid
Here at CUB, we’ve kept the pulse on emerging technologies in energy production, from wave to wind. And we stay on top of the impact of the Renewable Energy Standard as we work towards its goal of 25% renewable power in Oregon by 2025. But as the state looks towards the impacts of the Smart Grid and electric grid modernization here in Oregon, we want to be sure everyone’s on the same page regarding how these two vital resources—renewable power and the Smart Grid—will interact.
As we saw earlier this year, the Bonneville Power Administration was forced to shut down its Northwest wind farms due to excess power production on the Columbia River from greater than expected snowpack melt. BPA, one of the region’s largest renewable power producers, was meeting all its load—that is, all the energy it needed to produce to meet the needs of its customers—from hydroelectric power off the dam, and BPA couldn’t balance its power production without turning off the turbines.
There’s no effective way currently to store excess power production for later use, so any power the wind farms would produce would have gone unused. This puts BPA in a tough spot: how should the Administration meet its commitments to renewable power production when the main source of its power generation is producing power off the charts?
Smart Grid technologies and applications can come into play here. If Oregon’s electrical grid, from production to consumer, were modernized effectively to include technologies and strategies that allowed utilities to answer high demand quickly and manage the distribution and storage of power over the whole state, we might find ourselves in fewer situations that require shutting off renewable power generation. The Smart Grid can fundamentally alter the management and integration of renewable power resources—resources that are generally variable. This means that they do not necessarily produce power in a consistent fashion, but rather work most effectively when a resource (the sun or wind) is available to spur power generation.
For example, matching up wind generation—which is most effective at night, when the winds are higher than they are during the daytime—with a night-time demand, such as the charging of electric vehicles at residences in Oregon could be an effective tool to connect time-specific renewable energy with time-specific demand. But there is no way to do this currently, working from the same electrical grid that served energy consumers in the 1960’s.
CUB believes that the Smart Grid has the potential to help answer these and other concerns about integrating renewable power into Oregon’s energy portfolio. Over the next fifteen years, more and more renewable energy resources will be developed and connected to the state’s electrical grid, and by discussing the best policies to implement now we can be prepared for our renewable energy future. On October 21st, 2011, CUB will be hosting a conference in partnership with the University of Oregon called Smart Grid: Today’s Regulation and Tomorrow’s Technology. We’ll be devoting an afternoon panel session to discussing renewable power and the Smart Grid with the Renewable Northwest Project’s Rachel Shimshak, Ken Corum of Northwest Power and Conservation Council, and Lee Hall of the Bonneville Power Administration. Roby Roberts, Vice President with EDP Renewables, will be moderating. We invite interested energy professionals to attend this conference to engage with us and our panelists on Smart Grid issues here in Oregon and the Pacific Northwest—for more information, click here.
Other posts in our series on Smart Grid: Why Smart Grid Advocates Should Learn About Utility Regulation and Electric Vehicles Continue to Emerge in Oregon.
Join Us in Welcoming an AmeriCorps Member to Our Team!
Today we are excited to announce that Emmaline Pohnl has started her AmeriCorps service with us! As an AmeriCorps member she is serving our community by working with the CUB Policy Center as a Community Organizer. Emmaline recently graduated from Northwestern University with a degree in Education and Social Policy and a minor in Environmental Policy and Culture. Emmaline is very passionate about community organizing and social justice and has focused specifically on how environmental issues and policy effect and interact with the community. After a train ride from Chicago to Eugene, Emmaline is excited to call Portland home and work with us on this important initiative.
Emmaline’s project focuses on engaging Oregonians with Electric Vehicle policy and how it relates to consumers and the environment. Electric vehicle charging stations are being deployed throughout Oregon and are already established in the Portland area. We are interested in discovering how consumers feel about Electric Vehicles, defining what principles should be included in policy development and working with interested stakeholders to develop sound policy positions. Emmaline’s work will be crucial in identifying what questions need to be answered to ensure sound deployment and policy development, understanding the potential of electric vehicles in our state and informing decision makers in the opinions and concerns of the public.
The CUB Policy Center was selected to sponsor an AmeriCorps member in August, 2011 through the Confluence Environmental Center. Confluence was awarded a three-year AmeriCorps grant (Fall 2011-2014) through Oregon Volunteers. Under this grant, Confluence has trained twenty AmeriCorps members this year that are working in the great Portland metro area in three areas: Energy and Resource Conservation, Healthy Watersheds, and Environmental/Garden Based Education. Confluence focuses on diverse communities in environmental issues.
The AmeriCorps program allows citizens to commit to very specific and intensive service in their communities. The program was launched in 1994 and engages over 70,000 Americans in service each year. AmeriCorps members work with nonprofits, government agencies and schools, helping meet critical needs in education, public safety, health and the environment.
Make sure to keep your eyes open for informational blogs and updates about electric vehicles in Oregon.
Electric Vehicles Continue to Emerge in Oregon
By now you’ve probably seen one of the next-generation EVs plying the streets of Portland or cruising down I-5. As one of the American launch markets for Nissan’s new LEAF (Low-Emission, Alternative Fuel) sedan, Portland and the Willamette Valley have been getting a good look at this new breed of auto. More electric vehicle models will be introduced in the market in the near future, including the Chevrolet Volt and the Mitsubishi i. Nearly every major auto manufacturer has some sort of electric vehicle in the development stage, indicating that the EV revolution is finally becoming a reality. All of these developments are exciting for people interested in cars, energy efficiency, environmental activism, and more. They also are spurring a number of discussions on policies regarding how to integrate EVs into Oregon’s electric grid and transportation network.
A primary policy issue that has arisen regarding EVs and the grid is the impact of adding vehicle charging stations to homes, businesses, and parking lots that want to offer charging capabilities. If EVs eventually achieve a sizeable market share in Oregon, the grid is going to need to be able to handle the additional load that this shift towards electrified transportation is going to create. For example, commuters arriving home after rush hour will plug their EVs in to charge just as the evening peak-use period for electricity is occurring. If most of these customers don’t need to use their vehicles again until morning, it may be helpful for the utilities to be able to communicate with the vehicles and charging units and manage the peak hour load by ramping charging up and down. EV owners could also opt for a time-of-use rate schedule that would allow them to charge their vehicles overnight at rates that would be significantly lower than what they would pay to charge during peak hours.
On the commercial side of the charging equation, there is also the question of what kinds of entities will be eligible to operate charging units. A number of companies are emerging in the EV charging industry, each scouting out locations and territory for installing charging infrastructure. Utilities need to establish a rate structure for EV charging that is fair to both customers and infrastructure operators. Furthermore, utilities entering the business of operating charging stations themselves should be required to do so under an affiliate ownership structure to ensure that the cost of the charging infrastructure does not get passed through to ratepayers. It is CUB’s preference that utilities are not made to be the primary operators of charging units, but if they are, the rates at which these units are billed should be the same as the utilities charge to any other operator.
One issue that that has yet to be fully resolved is that of standardizing the various types of charging stations and EVs to ensure good compatibility. A recent New York Times article highlights current industry efforts and challenges in this area. However, settling the precise connector types and standards for the myriad charging stations and vehicle types is likely a small technical hurdle that will not ultimately represent a serious problem for EV owners.
Meanwhile, charging stations continue to grow in number throughout the state, with the majority being along the I-5 corridor. In fact, Oregonians with range anxiety will be happy to know that just this month, ODOT announced its selection of AeroVironment Inc. to install and maintain 22 new fast charging stations in the state. These are the Level 3 DC fast charging stations that can take some EV models from 0-80% charge in under 30 minutes. A map of proposed sites for the charging stations is available on the ODOT website (PDF). While these are only proposed sites, this or a similar distribution would likely make all but the most remote parts of the state accessible for some EV models, allowing for use of the vehicles for more than mere commuting purposes.
Portlanders interested in looking at some of the different charging stations are encouraged to visit PSU’s “Electric Avenue”, a project designed both to showcase EV technologies and to serve as a public charging station for them as well. On site there are charging stations from various companies including Eaton, ECOtality, General Electric, Northwrite Inc., OpConnect, Shorepower Technologies, and SPX. Only one of the 8 charging stations there is a DC fast charging model, but EV owners take note: You pay to park, but the charging is free. For more information, check out the Electric Avenue Website.
CUB will continue to be actively involved with the various aspects of electric vehicle implementation in Oregon. One venue for discussion will be an upcoming conference hosted by CUB’s sister organization, the CUB Policy Center. Titled Smart Grid: Today’s Regulation and Tomorrow’s Technology, the conference is specifically designed to engage stakeholders through the region in a thoughtful review of existing regulations combined with a thorough understanding of the possibilities of Smart Grid.
We hope you will join us. Please register today as space is limited.
PUC Considering Raising the Cost Of Home Heating and Cooling.
Since 1979, the policy of the state of Oregon has been based on trying to minimize utility shut offs by helping customers manage their highest electric bills. A new proposal at the PUC would dramatically change this policy by introducing a rate structure that varies the price of electricity depending on the time of day. Instead of trying to help customers manage bills, the PUC would be trying to increase customers’ bills in order to provide an incentive for customers to use less energy. Here is how a PUC economist describes the goal:
The tightening of budgets due to elevated utility prices motivates, not enables, the making of capital investments that will serve as substitutes for electricity consumption. Basic economic theory holds that when the price of a particular good is elevated, the demand for substitutes for that good is also elevated. From my own experience, monthly mid-winter electricity bills around $180 in earlier years motivated this Staff person to invest in a heat pump system this year in hopes of achieving a substantial electric bill reduction. The heat pump is viewed as a substitute for excessive electricity consumption.
While CUB doesn’t doubt that this is a true reflection of the experience of a PhD economist employed by the Oregon Public Utility Commission, it is not the experience of many other Oregon customers, who do not have the ability to make capital investments or the time to research economic substitutions. It is not true for renters who cannot make capital investments in their homes. It is not true for low-income families that are struggling to pay their bills. It is not true for people who are dealing with mental illness and may have trouble understanding the change in their rates. It is not true for families that are dealing with real issues such as health problems, marital issues, or deaths in the family, all of which are immediate and may prevent the timing of their energy usage from remaining a top-of-mind concern.
Time Varying Rate Options.
There are three basic versions of time varying rates, all of which are attempts to raise rates during peak times and lower rates during off-peak times. Peak usage is generally driven by heating and cooling our homes.
• Seasonal Rates. Under a seasonal rate system, rates rise during the winter and/or summer period, which corresponds to heating and cooling, resulting in lower rates during the fall and spring.
• Time-of-Use Rates. Time-of-Use rates vary over the course of the year, week, and day. For example, PGE’s optional Time-of-Use rates charges customers three different rates: on-peak, mid-peak, and off-peak, with rates changing up to 5 times each day. Rates are different on weekdays, Saturdays, and Sundays. Summer rates are different than winter rates—and the time that prices change within each day is different in the winter and summer. In the winter, on-peak prices are highest and correspond to when families turn on their heat, and in the summer prices are highest when families run their air conditioners. We are not surprised that few customers choose this option.
• Critical Peak Pricing. Critical Peak Pricing, which is often done in conjunction with time-of-use rates, charges really, really high rates (5 or 6 times normal) during the handful of hottest and coldest days of the year, when the utility system is at its peak. This is similar to a gas station raising gas costs fivefold during holidays when driving is at its peak.
Unprecedented Policy Change
This is a dramatic policy change. Since the economic difficulties of the late 1970s, Oregon policy with respect to energy has been designed to help customers manage their bills and their winter heating costs. Over the ensuing decades, Oregon has established lifeline rates, consumer protections from utility shut offs, equal pay programs that allow customers to spread seasonal heating and cooling costs out through the year, and bill payment assistance funded by a surcharge on utility bills.
Currently thousands of Oregon households are being disconnected from electricity service each year because they cannot pay their bills.
Disconnections peak in March, which shows that customers are falling behind while trying to pay their winter heating bills. That customers are struggling should come as no surprise. The economy is in a deep recession, unemployment is high, and utility rates continue to climb—Pacific Power’s rates have gone up 60% in recent years. The fact that this policy change is even being discussed suggests a serious disconnect between state regulators and state residents.
These programs aren’t just unpopular in Oregon. While some utilities have mandatory seasonal rates, CUB is not aware of any utility in the country with mandatory time-of-use or critical peak pricing. Puget Sound Energy, in Washington State, adopted this type of rate structure but later repealed it. The reason is simple. Customers generally don’t like these pricing schemes, and some customers will be harmed by them. We have seen PUCs around the country reject mandatory time-of-use and critical peak pricing, and it is time for Oregon’s commission to do the same.
There are better alternatives
There are better rate options that are more consumer-friendly, but Oregon utilities won’t ever develop these if the focus is on mandatory time varying rates.
One alternative is to offer time varying rates on a voluntary basis. This way the winners can take advantage of the rate structure without creating losers. Customers who have the ability to reduce their heating and cooling during the on-peak period will benefit from voluntary programs and the reduced off-peak rates associated with these programs.
Oregon utilities can offer peak reduction rebates, as some utilities elsewhere are doing. Offering customers discounts or rebates when they reduce peak usage creates an incentive without penalizing renters and low-income citizens.
Even better, utilities can offer direct load control programs where the customer works with the utility to reduce heating and cooling. Emerald PUD in Eugene has a program where it pays customers a discount in exchange for the ability to lower the temperature on their hot water heaters and thermostats a couple of degrees during peak periods. Idaho and Utah have also established air conditioning programs where the utilities cycles air conditioners on and off, so everyone gets their home cooled, but the utilities ensure that the air conditioners are not all working at the same time.
When PGE was considering installing Smart Meters, CUB was concerned that once the meters were installed, the PUC staff would propose mandatory time varying rates. The PUC staff assured us that this would not happen—that the PUC staff was interested in voluntary programs but not mandatory ones. But to an economist, the appeal of price signals is too strong. Once smart meters are installed, it is easy to test all kinds of keen economic theories about how people react to price signals. It is such an easy experiment to conduct that sometimes the experimenters lose sight of the human cost involved.
PacifiCorp Is Starting to Get the Message On Coal
CUB and other energy industry observers have known for years that PacifiCorp’s fleet of coal-fired power plants is a liability of sorts for the company. PacifiCorp’s most recent long-term Integrated Resource Plan (IRP) indicates that investments of more than $4 billion will be required in the coming years to bring all of these plants into compliance with federal and state clean air regulations. It is likely that further analysis will indicate that at least some of these investments can be avoided by shortening the life of PacifiCorp’s least-efficient coal plants and investing in replacement generation resources that are cleaner and more efficient.
Until recently, PacifiCorp seemed unwilling to budge on these investments, insisting that it should remain with the status quo of its coal plants rather than consider investing in any other resource options. The robust, plant-level analysis of clean air investments that CUB and other customer and environmental organizations have been advocating for was absent in the initial plan submitted by the company earlier this year. However, on Friday August 19, 2011, PacifiCorp made a formal presentation of its IRP to the Oregon Public Utility Commission and included within that presentation an acknowledgement that the unit-by-unit research which CUB and other stakeholders are seeking is necessary. After PacifiCorp, CUB and other stakeholders spoke directly to the Commission. Each of the stakeholders and CUB reiterated the position that a unit-by-unit analysis is necessary in this IRP and that such analysis cannot be kicked down the road.
Much to our relief, the Commissioners then made it known to PacifiCorp’s regulatory staff, in no uncertain terms, that a full investigation of clean air costs will be required for the 2011 PacifiCorp IRP to be officially acknowledged by the Commission later this year (see the Oregonian’s report on the Commission meeting
here).
CUB is pleased that PacifiCorp has finally agreed to move forward with the detailed analysis of costs that CUB has been seeking. This is because PacifiCorp’s total proposed investment in the coming years, over $4.2 billion, is significantly larger than the $500 million investment required of PGE—a $500 million investment that was enough to cause PGE’s Boardman coal plant to shut down 20 years ahead of schedule.
This is important for many reasons, but in particular because it is increasingly likely that regulations governing CO2 emissions from coal plants will be passed in the not-too-distant future, adding significantly to each coal plant’s operating costs. Rather than make clean air investments now and face an early shutdown due to carbon regulations in the 2020s or 2030s, it will be in the best interest of PacifiCorp’s ratepayers and shareholders to reach a solution that minimizes the long-run costs of regulatory compliance.
CUB is diligently researching the various potential future options available to PacifiCorp with regard to its generation fleet. Whatever the final choice, CUB will work hard to make sure that the long-term interests of Oregon ratepayers are protected.
Wind in My Closet
I could feel the wind in my closet.
That was the result of the blower door test I had done. A Clean Energy Works Oregon specialist put a large fan in my front door to suck the air out of my house. Using an infrared scope, I could see where air was leaking into the house. Upstairs, in my closet, the air was coming in so fast you could feel the breeze.
This isn’t unusual for a house that was built in 1926. For much of the history of my house, the Northwest had an abundance of cheap, affordable energy, and even something as simple as putting insulation in the walls was not considered to be a cost-effective investment. Those days of cheap energy ran out in the 1970s as oil and gas prices rose and the cost of electricity increased as the region began exhausting its supply of hydro power and building expensive, new coal and nuclear power plants. But my house did not change. Its furnace continued to crank out heat, with a fair amount of the heat leaking out through drafts and un-insulated areas. Eventually some new windows were added, but my house, like many others in the Portland area, remains a testament to the days of cheap energy.
The end result of my energy audit was clear: a handful of small steps —sealing up the leaks and adding insulation in the walls, attic, rim joist, and knee walls—could save quite a bit of energy. In addition, I could reduce my energy use even more by investing in a new efficient furnace and new efficient water heater.
Some of these actions, such as the air sealing and the additional insulation, will pay off almost immediately in reduced gas usage. The bigger capital investments in a new furnace and water heater will take longer to pay off. Because the Clean Energy Works Oregon program includes financing, my family can make these changes immediately and with no upfront expense. The cost of the energy efficiency investment will be added to my natural gas bill and I can pay it off over the next 20 years.
This is the basic premise of Clean Energy Works Oregon. It offers a way to easily identify energy efficiency upgrades to your home and supplies the financing to make it happen. The program also simplifies the process by providing a single contact person for me to work with throughout the process. This means that I don’t have to work with multiple banks to secure a loan and then find individual contractors for each efficiency upgrade, which could be tiresome and confusing if I had to use one contractor for insulation, another for my gas furnace, and a third for my water heater. By lowering the barriers to making these improvements, Clean Energy Works Oregon makes the process simple for a homeowner.
After my CEWO application was accepted, the initial energy audit demonstrated that I can reduce my household energy use by more than 30%. Clean Energy Works offers incentives to help reduce the cost by up to $3,200. The financing allows me to pay off this expense over a 20 year period at a 5.9% interest rate—though I can pay it off more quickly or refinance it through my credit union if I want. Just as important, I can make my house much more comfortable. In the winter my house is drafty and the temperature varies significantly from room to room.
In my case, I expect that the energy savings will cover at least 65% to 75% of the cost of financing the loan in the first year. As the price of utility service increases over the next few years, the energy savings reduction in my bill will become greater than the cost of the loan that is financing the investment. It should be noted, that I could have chosen to do less energy efficiency so that the bill savings cover all or most of the cost of financing the new measures. But knowing that energy prices will continue to rise, that we will eventually need to replace our furnace and water heater, and that this is a program that makes an energy efficiency upgrade easy, my family decided to use this opportunity to make a significant investment in our house.
My wife and I will sign the loan papers next week and contractors will soon start showing up at my house. By winter, my 1926 house will be brought into the 21st century.
Bob Jenks is the Executive Director of the Citizens’ Utility Board of Oregon, and is as much a fan of the outside of his house as the inside.
If you own and occupy a single-family detached home built before 1993, your home may be eligible for the Clean Energy Works Oregon program. The service territory includes the following locations:
Cities:
Portland, Hillsboro, Gresham, Lake Oswego, Medford, Ashland, Grants Pass, Klamath Falls, Lakeview
All areas in the following counties:
Clackamas, Multnomah, Washington, Jackson, Josephine, Klamath and Lake Counties
Other locations to be announced soon.
Visit the Clean Energy Works Oregon website, www.cewo.org, for more information and to apply for the program. The application only takes a few minutes and is easy to do..
Community Renewable Energy
As the next installment in our ongoing series on renewable energy, we examine the history of community energy projects and their role in the development of renewable power sources. To learn more about community energy projects, Paul Woodin gave CUB a briefing on his work as the Executive Director of the Community Renewable Energy Association (CREA). Here is a quick recap of Paul’s briefing.
After the Renewable Portfolio Standard was created in 2007, the Renewable Energy Working Group helped create state policy that indicated 8% of new generation capacity in Oregon should come from community or locally-owned renewable energy projects. In addition to this policy, it was also suggested that State Agencies should adopt favorable policies for achieving this goal. With the assistance of the Oregon Energy Trust, CREA has helped support and promote community renewable projects across the State of Oregon. CREA is a Chapter 190 organization comprised of 14 counties, the State of Oregon, and 25-30 private corporations and individuals. Although CREA works within the state, it is focused on addressing federal issues related to community renewable projects such as the investor tax credit, production tax credit, and other incentives.
Generally speaking, any project smaller than 10 MW that is owned locally or publicly by the community is considered a community renewable energy project. Some examples of currently operating community energy projects include small-scale hydro power and small wind farms. Small-scale hydro power can be found throughout the Cascade region, where irrigation systems can be fitted with small turbines to utilize the existing flow of water. The power generated from these systems is relatively small, but it significantly reduces the cost of operating the irrigation system. Small wind projects are another proven form of community energy. These projects are typically developed through public-private partnerships that use public land and can also take advantage of business tax credits and incentives. The partnership is able to generate revenue for both parties through power purchase agreements with utilities. In addition to these two examples of community power, there are projects in development that utilize a wide array of technologies, including solar, geothermal, biomass, and cogeneration.
Even though community projects provide benefits for many stakeholders, there are challenges that hamper their development. A major challenge to developing a community power project is that policy changes can quickly eliminate critical incentives or create new regulations that prevent a project from being completed as planned. Like any energy development, securing power purchase agreements for community projects can be difficult. Without dependable revenue there is no way to guarantee a project’s profitability. In Oregon, the Renewable Energy Working Group has established guidelines for negotiating power purchase agreements for community projects, but it does not guarantee a deal can be reached. In order to secure a power purchase agreement, community projects must already have or be able to develop reliable transmission infrastructure to the state’s grid. This can add additional costs to a project even though the power will most likely be consumed locally. In addition to these obstacles, there are also environmental and aesthetic considerations that must be taken into account when developing a community project. Getting buy-in from all stakeholders can be difficult since community power is, for some people, a relatively new concept that lacks widespread understanding.
Outside of commercial power, most power generated in the U.S. comes from community projects. Looking to the future, it will be important to continue developing community energy projects to promote renewable power and contribute to a diverse portfolio of energy sources. In order to do this, incentives at both the state and federal levels need to be dependable enough to minimize financing and construction setbacks, and strong enough to encourage development. Favorable power markets can also contribute to the growth of community projects by providing easily negotiated power purchase agreements and clearly defined revenue streams. As energy consumption increases, the definition of a community project may need to be expanded so that larger projects can be developed at the community level to meet rising demand.
Paul Woodin and CUB’s Jeff Bissonnette are both members of the state’s Renewable Energy Working Group. CUB and CREA have worked closely with each other in the past and hope to see the continued development of community projects in the State of Oregon.
Lessons Learned from Illinois CUB
Last week I headed to Chicago to spend time with the energetic staff at Illinois CUB. Yes, you read that correctly: just like Oregon, Illinois has a CUB that represents residential customers in ratemaking proceedings before the Illinois Commerce Commission (ICC), in the courts, and before other public bodies and provides consumers with information and assistance regarding their utility companies.
As the Project Manager for CUB Connects, I am developing an outreach program to get information on selecting communication services, reducing high phone bills and other consumer tips into the hands of my fellow Oregonians. Through the research for and creation of the CUB Connects website, my coworkers and I have learned a lot about phone and internet options, pricing, scams, opportunities and more. In addition to the informative website and searchable database, there is a lot more information that we can share with consumers—and making sure we have an effective outreach strategy is vital to getting that information out there.
Illinois CUB has a very strong consumer outreach program, and experiencing how CUB Illinois helps consumers save money in the complicated world of telecommunications is a great first step to planning our own outreach initiatives. In addition to great online resources and consumer guides, the Illinois CUB has been hosting phone bill clinics for over 15 years. These free clinics are offered throughout the state and hosted by community centers, libraries, community leaders and other groups.
I attended two phone bill clinics where Illinois CUB staff sat down one-on-one with attendees to analyze their phone bills and offer specific cost-cutting advice. One staffer was able to save a customer from Summit, IL $52 a month on his home phone bill. That totals over $600 a year in savings! Both of the phone bill clinics were sponsored by public libraries that commonly have workshops and events for their community members. The first clinic in Plainfield, IL had over 30 attendees, and the savings averaged $15-$20 a month per attendee!
At the end of the last clinic, I spoke with a woman from Summit, IL about her lengthy support of IL CUB since its formation in 1983. When I explained to her that I was from Oregon CUB and why I was visiting from Oregon to learn about IL CUB’s outreach program she beamed with pride, emphasized the important work that CUB does and wished me the best of luck in helping Oregonians save money on their phone bills and traverse the ever-complex world of communications. At CUB Connects, we intend to live up to that mandate by visiting communities around the state. If you’d like to partner with us on bringing a workshop to your community, contact us at .(JavaScript must be enabled to view this email address)!
2011 Legislative Session: One for the History Books – And Not
The 2011 session of the Oregon Legislature has been history for about a month now, and CUB Organizing Director Jeff Bissonnette has had some time to decompress a bit and summarize CUB’s work during the session. Here’s his overview of the session with its wins, losses and stuff still on the to-do list.
The 2011 session was one for the history books right from the start. It featured Oregon’s first third-term governor, the Oregon Senate’s first fifth-term President, and a first-ever evenly divided House of Representatives, complete with first-ever Co-Speakers of the House. In addition, legislators faced an unprecedented $3.5 billion (not a typo, that’s “billion” with a ‘b’) budget deficit to overcome.
This session was definitely not one in which revolutionary changes were going to be made–narrow voting margins and an even narrower financial margin would ensure that. But that didn’t stop us from bringing an ambitious agenda to the table. While we certainly didn’t get everything we wanted, CUB fared pretty well in the session.
Wins
SB 967 - Utility Tax Reform: This bill raised a hot-button issue from 2005: making sure the utilities don’t charge customers more for taxes than the utility actually pays. We helped pass SB 408 back in 2005, joining with the industrial customers and others. Since the passage of SB 408, CUB has come to the conclusion that while we got the policy right–utilities cannot charge customers more for taxes that the utility actually pays the way the policy was implemented–through an annual “true-up” process–was time-consuming, cumbersome, and resulted in some wacky outcomes (and yes, that’s a technical term). CUB was not, however, willing to engage in discussions about “reforming” SB 408 because we thought the utilities’ definition of reform was to repeal the law.
As our readers likely know, former PUC Chair Lee Beyer won a seat in the Oregon Senate in 2010, and in 2011 was appointed the chair of the Business, Transportation, and Economic Development Committee, which deals with a lot of utility issues. Sen. Beyer recognized the issues surrounding SB 408 and appointed a workgroup headed by Sen. Jason Atkinson and Sen. Ginny Burdick and facilitated by PUC Commissioner Susan Ackerman. His instruction to the workgroup was that: the policy of SB 408 must stay, and all the parties that are regularly involved in the annual true-up process have to agree on a new implementation solution or nothing happens. This was good news. With the assurance that the goal of the discussion was not to repeal the policy established in SB 408 but to figure out a better way to implement the policy, CUB was willing to engage in the negotiations.
And, although we didn’t think it was possible, all the parties–both customer groups and utilities–that have been actively involved in the annual true-up process came to an agreement. We decided that we could track taxes just like we do every other utility cost, on an ongoing and regular basis rather than in a special annual process and we can examine how the corporate structure of the utility affects its tax structure to prevent the kind of abuses we saw under Enron and ScottishPower. So, as we examine utility rates we can look at the tax level, and adjust it to make sure that customers are not being overcharged. The new law also instructs the PUC on how they should consider taxes collected by a utility that is part of a larger corporate conglomerate (like Pacific Power) and how they should treat taxes by an entity seeking to purchase a utility.
We know that a lot of folks wonder if this new implementation method will work. We’ll be reporting on the various dockets where taxes might be impacted and will tell you how successful the new process is. However, we believe that it’s a big win for consumers to have kept the hard-won policy of SB 408 but found a better, less-costly way to make the policy work.
HB 3461 - Klamath Dam Bill: In the 2009 session, CUB was involved in passing a bill that confirmed the PUC’s authority in determining whether PacifiCorp-owned dams in the Klamath River basin could be removed. While it appeared that there was a strong economic case to be made for removing the dams rather than relicensing the dams, CUB wanted to be sure the PUC had a process to determine that dam removal was the best approach for customers. As part of the 2009 bill, a small charge would be added to customers’ bills to build up funds so that any impact for either dam removal or relicensing wouldn’t come all at once as a lump sum sometime in the future.
HB 3461 allows the PUC and State Treasurer to manage the funds in order to generate a return and reduce the amount of money that needs to be collected from customers. Although some folks tried to revisit other issues previously settled at the PUC, that process was prevented and the bill passed, giving the PUC the ability to work with the state Treasurer’s office to invest some portion of the Klamath fund in a way that protects consumers and generates more money.
HB 3672 – Residential Energy Tax Credit/Business Energy Tax Credit: An entire book could be written about the long, byzantine road this issue traveled over the past few years. And it probably will be. But for this report, suffice it to say that the tax credit policy frameworks and funding were preserved; but there is still more work to do.
The credit formerly known as BETC (Business Energy Tax Credit) was divided up into three different tax credits: manufacturing, energy conservation, and renewable energy generation credit. The manufacturing credit will be administered by the Oregon Department of Business Development, rather than the state Department of Energy. There are workable policy frameworks in place for both the energy conservation and renewable energy generation credits. Both those latter credits now operate under caps: $28 million for the conservation credit and $3 million for renewable generation. The amount for renewable energy generation is a severe reduction and will have an adverse effect on the development of renewable energy in Oregon. But, given that the program was slated for total elimination, the fact that it was preserved and funded was a victory for this session. The manufacturing credit is slated tosunset in 2016 and the other two credits were given sunsets of 2018.
The Residential Energy Tax Credit (RETC) emerged largely unchanged, with no program caps. The legislature did eliminate appliances from being included in the programs and put a funding cap on “third-party installed” systems, such as those being marketed by companies like SolarCity and Sun-Run. RETC was given a sunset in 2018. By and large, residential customers should see very little change in RETC in the coming few years.
HB 2690 - Cool Schools: This bill has been given a lot of media coverage because it was 1) an issue that Governor Kitzhaber campaigned on and 2) a bi-partisan bill in a session that was marked by a divided legislature. The bill uses no new money but simply authorizes better coordination between existing funds, including public purpose dollars, the state’s Small-Scale Energy Loan Fund, and federal Qualified Energy Community Bonds. The bill will enable schools to access these funds in a way that would have been previously more difficult. CUB was proud to be part of the broad coalition that supported the bill.
SB 863 - Low-Income Energy Assistance: The recent recession hit Oregonians hard and, even though the recession is officially over, many Oregonians are still struggling. Social service agencies across the state are seeing families who have never sought assistance before. These families need help paying their bills, including utility bills, because of now long-term unemployment or underemployment. In addition, it is likely Oregon is about to see a substantial drop in federal resources for energy assistance–as much as $20 million.
SB 863 adds to the existing $15 million program in Portland General Electric and PacifiCorp territories by allowing the PUC to increase the program by as much as $5 million a year for no more than two years. The PUC would consider an increase if requested by the Department of Housing and Community Services and if several criteria are met. Those criteria include poverty rates, unemployment rates, and the like.
The bill recognizes that adding more money will not completely resolve the situation, so it also authorizes discussions of how to use existing resources differently and more efficiently to help more people. Finally, it mandates seats on the Advisory Committee on Energy, which advises the Department of Housing and Community Services, for both the utilities and CUB so that we are assured of being able to keep tabs on consumers’ money.
Attacks on the Renewable Energy Standard Beat Back: Since the adoption of the state’s Renewable Energy Standard of 25% by 2025 in 2007, proposals for changes have been constant. Last session, we helped negotiate changes to allow some vintage biomass facilities. This session there were many proposed changes, but all were turned back and the standard escaped the 2011 session unscathed.
The most significant threat was brought by Umatilla Electric Co-operative, which is currently considered a “small” utility and thus is subject to a reduced standard. However, the utility is expecting a large server farm to be located in its service territory, which would significantly increase its load and eventually (in about 8 years) would make it a “large” utility, subject to the full standard. UEC wanted the legislature to declare that it would always be a small utility, no matter what happened to its load. Since the whole reason for the RES was to ensure that the state’s growing energy load was partially met by renewable energy, this proposal would start to water down the standard in a dangerous way. We will almost certainly see this proposal again, so CUB will be on guard to ensure that the balanced, effective standard we have now will be protected.
Public Purpose Funds Left Alone: As noted earlier, there was a significant budget deficit at the start of the session. In past sessions, this meant that the legislature would attempt to re-direct ratepayer funds dedicated to energy efficiency and renewable energy investment to other needs. CUB has always maintained that these ratepayer funds were not available to the legislature to be used for general budget purposes and it has taken a lot of work to protect these funds. We were sure that there would be a significant battle to protect the funds again this year, but that battle never developed. Perhaps all those years of defending the funds finally convinced legislators that the funds were too much trouble, or perhaps having a former PUC Chair, as a member of the state Senate, was helpful. But in the end, ratepayers’ public purpose funds are safe….at least for now.
Losses
Climate: There was a very straightforward bill–SB 706–that would have simply provided information for future policymaking efforts on reducing greenhouse gas emissions, but the bill only received an informational hearing. As such, the 2011 session did not make any significant advance on having Oregon deal constructively with climate change.
Bold Energy Efficiency Agenda: Although we did have some energy efficiency victories, we did start out with a much more ambitious efficiency agenda. We had hoped to see some sort of “energy performance score” system that would provide a “miles-per-gallon” type rating for residential and commercial buildings, or to see some kind of incentive for buildings built beyond the existing codes. We had also hoped to codify Oregon’s “efficiency first” regulatory policy to ensure that would always be the state’s policy. But, unfortunately, these proposals did not make it through the process.
To-Do
More EE: Energy efficiency will continue to be an important issue. It is truly non-partisan and benefits both residential and commercial customers. There will be future interest on continuing to build our capacity for efficiency and CUB will support those efforts.
More Protection of the RES: The renewable energy standard will continue to see proposals to incentivize new renewables. While that’s not necessarily a bad thing, we need to make sure that the very balanced and affordable policy we have now is not upended. We will also have to be watchful that efforts to water down the standard (see the UEC proposal above) are turned aside so we get the amount of renewable energy we actually expected with the standard’s passage back in 2007.
Tax Credit Rulemaking: We reported on the changes for energy tax credits above. We also said that residential customers shouldn’t see much difference in the RETC. That should be qualified by noting that there is still a lot of rulemaking to do. Depending on the rules adopted, the original intent of the legislative action might be changed completely. So CUB will be very involved in the rulemaking around the tax credits to ensure that residential customers can be well-served by utility incentives and tax incentives that are well-coordinated.
No legislative report is complete without saying that CUB’s success is always dependent on our members. We didn’t have to do a lot of alerts this session, but the ones we did do were very effective, and legislators and their staff recognized CUB as having members throughout the state who care about good energy policy and consumer protection. So, we can never say it enough: THANK YOU, CUB members, for your support in making CUB effective!
Why Smart Grid Advocates Should Learn About Utility Regulation
Many of us have heard of the Smart Grid and its potential to improve the electricity delivery system. Moving to a two-way digital grid will improve the grid’s reliability and offer a variety of new potential applications. Rather than shut down wind turbines at night when there is more power generated than the grid can absorb, a Smart Grid could use hot water heaters and commercial freezers to store excess energy. The Smart Grid can vary the charging of an electric car so the charging rises and falls with wind power production. The Smart Grid can also know when and where there is a power outage, rather than rely on phone calls from customers to report outages.
But as we have talked about Smart Grid in the region, CUB has come to realize that many Smart Grid advocates don’t understand the current regulated electric system. They don’t understand how we analyze utility investments or how prices are set. They don’t understand the incentives provided to utilities or protections required by customers. Put simply, they don’t understand the “regulatory compact” between customers and utilities.
The Smart Grid has the potential to change our electricity system in fundamental ways. But to effectively create positive change, it’s necessary to understand the present. I, like our current President, worked as an organizer after college and think one of Sal Alinsky’s rules for organizing is important to keep in mind anytime we are talking about fundamental change:
“As an organizer I start where the world is, as it is, not as I would like it to be. That we accept the world as it is does not in any sense weaken our desire to change it into what we believe it should be — it is necessary to begin where the world is if we are going to change it to what we think it should be.”
In other words, for the Smart Grid to live up to its potential by fundamentally changing the electric system, we have to begin with our current system. We can and should desire to change it, but it is necessary to begin by understanding and accepting the existing electrical grid.
In the Pacific Northwest, we rejected the Enron-sponsored deregulation proposals a decade ago. This means that we have integrated monopolistic utilities that are regulated by the states’ regulatory agencies or are accountable to locally-elected Boards. Regulators and local Boards have the responsibility to protect customers from monopoly abuses and get power at just, reasonable, and affordable rates. And that regulation is subject to legal requirements and historic policies and principles. Some of the key elements applicable to the Smart Grid:
1. Rate Base as an Incentive for Investment. The current structure of regulation for investor-owned utilities was developed in order to incent long-term capital investment. Building power plants, transmission systems, and distribution networks cost billions of dollars. The current system is designed to encourage capital investment by providing a utility with a return on invested capital–utility profits come from investing in power facilities, not directly from the selling of kilowatt hours.
2. Utilities can generally only charge customers for investments that are “used and useful” for providing utility service. It may take a utility more than a year to build a power plant or construct a transmission line, but it cannot put those costs into rates until the asset is up and running. Likewise, utilities are generally discouraged from keeping assets in rates after those assets stop providing service.
These two regulatory principles tell us a lot about utilities. In the 1990s, we heard a lot of complaints that utilities were not generally making investments in renewable resources, particularly wind turbines. Today there is not a utility in the region that isn’t investing hundreds of millions of dollars in wind turbines. This can be explained by the two principles above. Utilities like capital investment, once that capital investment is considered low risk. In the 1990s, utilities might have been concerned that wind turbines were untested, that their useful lives were not well-documented, and that shareholders would take on a significant risk that the investment would not be “used and useful” for a long enough period to recover the cost of the investment and see a return on the investment. Once wind facilities were well proven, utilities were happy to make huge investments in wind power. Similarly, once Smart Grid technology becomes mature and “safe,” getting utilities to invest in it will not be difficult. And so, the problem right now is: How do we get Smart Grid technology to the mature and safe level?
To begin to answer that question, CUB’s sister organization, the CUB Policy Center, is hosting an inaugural conference this fall here in Portland, Oregon. Titled Smart Grid: Today’s Regulation and Tomorrow’s Technology, the conference is specifically designed to engage stakeholders through the region in a thoughtful review of existing regulations combined with a thorough understanding of the possibilities of Smart Grid.
We hope you will join us. Please register today as space is limited.
CUB Connects at NARUC Summer Committee Meetings 2011
Andrea Crosby here, reporting on my recent sojourn to sunny Los Angeles. This past Sunday, I headed down to California to present at the National Association of Regulatory Utility Commissioners (NARUC) Summer Committee Meetings. This was a great opportunity to represent CUB at the national level and talk to influential regulatory staff members from all over the country. NARUC’s mission is to improve the quality and effectiveness of public utility regulation and the summer committee meetings aim to educate NARUC members, discuss current issues and provide joint resolutions that represent the overall organization. The complete program that outlines all of the sessions is available online.
I was invited to speak to the Staff Subcommittee on Consumers Affairs in a joint session with the Staff Subcommittee on Telecommunications for a full one-hour time slot. My presentation was titled “CUB Connects: Oregon’s Effort to Educate Consumers in an Unregulated Marketplace”. CUB Connects is the first project of its kind in the country which makes us leaders in consumer education for telecommunications services.
My main goals were to provide the regulatory context as to how CUB Connects came to be as well as clearly explain the importance of CUB Connects for Oregonian consumers, the development of CUB Connects and our goals for the project moving forward. CUB Connects is a great example of how regulatory commissions can encourage consumer education projects as the telecommunications industry becomes increasingly deregulated. Some Cubbies still recall when the only decision to make when signing up for phone service was whether you wanted the phone on the wall or on the desk. Those days are long gone. With the deregulation of the telecommunications industry and the proliferation of wireless and digital services, consumers now face a competitive and often confusing marketplace full of options. This modern dilemma calls for modern solutions.
CUB Connects’ searchable database is just the beginning of this solution for Oregonians. Moving forward we are looking to promote a series of educational workshops throughout the state that deal with the issues that consumers face in the telecommunications marketplace. In addition to helping participants understand and possibly reduce their phone and internet bills, the CUB Connects team will be offering workshops on internet safety, preventing and identifying scams, tips to purchasing phone and internet plans and more.
Overall, the NARUC audience seemed very interested in the project and asked some great questions about the development of the project and the framework agreement under which we developed the project. It was really rewarding to present to people that are engaged in this type of work throughout the country and show them how we have successfully developed a consumer education project here in Oregon.
Coal’s Future Looks Dim
At the Citizens’ Utility Board, we always have an eye on coal. We fought PacifiCorp’s plan to build three additional coal plants and we worked to ensure that the Boardman coal plant is phased out by the end of 2020. CUB continues to keep a watchful eye on the impact of coal on the state and region.
That’s why the abstract of a recent study published in the Annals of the New York Academy of Sciences caught our eye with a very intriguing proposal:
“Each stage in the life cycle of coal—extraction, transport, processing, and combustion—generates a waste stream and carries multiple hazards for health and the environment. These costs are external to the coal industry and are thus often considered “externalities.” We estimate that the life cycle effects of coal and the waste stream generated are costing the U.S. public a third to over one-half of a trillion dollars annually. Many of these so-called externalities are, moreover, cumulative. Accounting for the damages conservatively doubles to triples the price of electricity from coal per kWh generated, making wind, solar, and other forms of nonfossil fuel power generation, along with investments in efficiency and electricity conservation methods, economically competitive. We focus on Appalachia, though coal is mined in other regions of the United States and is burned throughout the world.”
This study’s conclusions bring up issues that are not necessarily considered in the practice of routine utility regulation. The Oregon Public Utility Commission is required to assess the generation portfolios of utilities on a least-cost, least-risk basis. This means that only the direct costs to the utility are considered in the approval process, regardless of the environmental or health impacts of generation. The risk of more stringent regulations on emissions from state and federal authorities, however, is a major consideration because it would lead to direct costs, and has factored in to a number of recent Commission decisions to steer utilities towards renewable sources of energy and away from fossil fuels. That said, CUB has to play by the Commission’s rules; meaning that a life-cycle analysis of the impacts of coal is more instructive for policy makers in Congress and the Legislature than it is as a guide for utility regulation.
Looking at the entire life cycle impacts of coal paints an ugly picture indeed. The process of extracting coal from the earth releases large amounts of methane into the atmosphere, which is itself a significant climate change impact. There are also the human costs of mining accidents, such as last year’s disaster at the Upper Big Branch mine that killed 29 miners. Mountaintop removal mining projects in Appalachia pollute streams, irreparably scar the landscape, and devastate forestland, resulting in carbon emissions from the loss of soil and forest plants. Mining wastes are impounded in large ponds adjacent to mines, many of which are situated in unstable areas that occasionally have catastrophic spills and pollute streams and drinking water sources.
Once the coal is mined, there is still the issue of transporting it to a power plant. Even though many plants are located adjacent to mines, 70% of rail traffic in the US is dedicated to coal transport. There are enormous opportunity costs associated with tying up such a large portion of the rail system to move a single resource. Additionally, hundreds of people die in rail accidents related to transporting coal each year; for 2007, the costs related to these deaths approached $1.8 billion.
Coal combustion to generate electricity causes a variety of air pollution and air quality issues worldwide. In addition to emissions of CO2 and other greenhouse gases, there are a number of other nasty airborne byproducts from coal combustion. Particulate matter causes haze and affects asthma sufferers; sulfur dioxide and nitrous oxides contribute to problems with acid rain and respiratory illnesses; mercury, arsenic, and other heavy metals kill aquatic life and are associated with increased rates of cardiovascular diseases and delayed childhood development. Most modern coal plants capture the fly ash that is emitted from their smokestacks, sequestering it in ponds on site. Like mining waste impoundments, these ponds hold millions of gallons of polluted water and are a risk for devastating spills, such as the one that occurred in Tennessee in 2008.
The primary driver of the study is the contribution of coal-fired power plants to climate change. The 7.85 billion tons of annual CO2 emissions from coal plants constitute 30% of emissions worldwide and over 70% of the CO2 emissions from generating electricity. Particulate matter (i.e., soot) is also a contributor to climate change, as it is very effective at trapping heat in the atmosphere. All of these emissions are accumulating in the atmosphere at a rate that is significantly altering the Earth’s climate. It is difficult to imagine that CO2 emissions will remain unregulated for many more years, given the dramatic impacts we are observing in climate and weather patterns worldwide. Climate change emissions are likely the single riskiest factor in operating coal plants, as it is likely that there will soon be large costs associated with burning coal and releasing carbon emissions.
The sum total of all of the environmental and health externalities associated with coal-fired electricity generation is staggering. The study places its best total estimate at $345.3 billion annually, with a range of $175 to $523 billion. If these costs were fully internalized, the cost of a kWh of electricity generated by coal would increase by somewhere between 9 and 26 cents/kWh, effectively yielding a 2 to 4-fold increase in rates for coal-dependent utilities.
The study also calls out carbon capture and storage (CCS), also known as “clean coal” technology, as a counterproductive development that will actually increase coal usage. This is due to the fact that CCS requires somewhere between 25% and 40% more coal to produce the same amount of electricity as is generated today. That increased usage would also increase the myriad environmental impacts associated with the life cycle of coal, thereby virtually eliminating any net benefits accrued from reduced the carbon emissions from generation.
CUB is committed to representing Oregon ratepayers’ values as well as keeping their rates low. We are confident that a strong majority of Oregonians are unhappy with the idea that generating energy this way results in low bills but high external costs. While coal may provide energy at what appears to be a low cost now, it is increasingly evident that when the health and environmental costs of the entire life cycle of coal are unbearable in the long run. CUB, along with a coalition of environmental allies, has successfully lobbied PGE to commit to closing its only coal plant over 20 years earlier than originally scheduled. The fight will now move on to PacifiCorp’s fleet of coal plants in the near future. We will keep you posted on the developments as we review the costs associated with PacifiCorp coal plants later this year.
No Panacea in Shale Gas Growth
The extraction of natural gas for use in generating electricity is growing fast, and the trend looks set to continue. As our reliance on gas grows, so too should our understanding of this abundant natural resource and the impact of its use. Back in March, we briefly discussed “fracking” as an issue that got a lot of attention at the 2011 Public Interest Law Conference. But fracking is just one reason why the gas industry is facing increasing scrutiny. And, as we saw earlier this year, it is not just Natural Gas industry who is betting heavily on the resource—utilities are making long-term bets on shale gas as well. So this trend will be important not just for environmentalists and industry, but for ratepayers as well. This blog post revisits fracking and takes a closer look at some of the issues associated with the drilling and production of shale gas.
Natural gas extraction is frequently made more efficient by breaking up, or fracturing, the rock and earth surrounding the wellbore. This is particularly true for gas extracted from shale formations, where rock surrounding the wellbore tends to be less porous than is desirable, thereby slowing the permeation of the gas into the well. The process generally involves pumping large amounts of an often toxic brew of chemical-laden water and sand in to the earth. Depending on the geography and processes used, some of this water risks making its way in to underground aquifers that provide water for human or animal consumption. In other cases, much of this water is brought back up to the surface, and what can’t be reused must be disposed of. There are different disposal techniques, but each comes with risks and problems for human health and the environment.
In addition to the concerns about the chemicals used in hydraulic fracturing, there are considerable emissions from the diesel generators and trucks frequently used to drill the wells. The cost of addressing these problems is not one that the natural gas industry has fully internalized. None of this is new but, owing to a number of recent high-profile exposés on the harms caused by hydraulic fracturing, the regulatory climate may be shifting.
Despite all these detractions, it has often been argued that, at least when compared to coal, natural gas remains a decidedly cleaner option. In particular, supporters have focused on smokestack emissions from modern gas plants as emitting far fewer greenhouse gasses than those from our nation’s aging fleet of coal-powered plants. But the picture of natural gas as a clean transition fuel to help America bridge the gap on the road away from coal and toward renewables has itself come under fire in the last couple years.
One prominent example is the study by Robert Howarth. In it, the Cornell ecologist focused on the large amount of methane that escapes from a gas well over the course of its lifetime through various leaks and inefficiencies. These “fugitive emissions”, as they are often referred to in the regulatory context, represent yet another significant source of concern in assessing just how clean natural production is because they have been largely overlooked in calculating the total emissions resulting from gas drilling operations. Once they are factored into the equation, claims Howarth, shale gas is not cleaner than coal, it is dirtier.
As the first peer-reviewed look at methane emissions, Howarth’s study garnered a large media. However, there remains no real consensus on its findings or the suitability of shale gas as fuel source, generally. Here is a snapshot of where some of the various regulators and stakeholders fall on this issue:
Environmental Groups: There are several environmental groups that support the general conclusion that natural gas extraction that makes heavy use of fracking has significant environmental impacts. Additionally, the Post Carbon Institute’s fellow Dave Hughes recently conducted another study scrutinizing the viability of natural gas which had similar findings to Howarth’s study.
Industry: Perhaps not surprisingly, industry is still touting the resource as producing 50% less carbon than coal and 30% less carbon than oil when burned, though there remains little to suggest that the industry has addressed the entire life-cycle of the resource.
Department of Energy: The DOE, through its National Energy Technology Laboratory (NETL), has applied ISO standard methodology and its understanding of industry operations, and calculated the carbon footprint of natural gas itself. It concluded that when used to generate electricity, natural gas (conventional or not) results in far fewer emissions than coal. This study doesn’t address Howarth’s study explicitly, but it does attempt to explain where a substantial portion of the methane goes—Howarth assumed that all of the gas was vented as methane, whereas the NETL explains that 62% of the gas is not lost, but used to power equipment.
Environmental Protection Agency: The EPA has released research showing that natural gas production could be 25% cleaner than coal or less when methane emissions from the full life cycle of gas production are taken into account. This is in direct conflict with Howarth’s study.
Others: Some scientists and organizations are saying that the methodology of Howarth’s study is not comprehensive enough to be credible. Recently, America’s Natural Gas Alliance’s blog contained a link to five experts from wide-ranging organizations, including the Council on Foreign Relations and Clean Air Task Force, which were all critical of the study.
In spite of the rising tide of concerns about gas, the pace of drilling continues to increase, suggesting the industry is either unaware of or unconcerned about these issues and the increasing pressure to internalize their costs. However, there is little transparency in the industry, which makes it hard to gauge what gas developers are doing or thinking. This may be changing. According to a recent article in the New York Times, there is mounting evidence suggesting that industry insiders recognize they may be moving too fast and that shale gas may not be as cheap or easy to extract as many have thought. And, it appears that state regulators are increasingly intolerant of the lack of transparency in the industry. For example, Texas recently passed a fracking disclosure law which should help scientists and regulators better understand the impact of the practice. New York has effectively banned the practice (though that ban is likely to be lifted soon) and New Jersey has even gone so far as to legislatively outlaw the practice, though this is largely symbolic as there was little or no fracking going on there prior to the enactment of the legislation.
Regardless of whether one is most concerned about the immediate, localized impacts from fracking chemicals or the broader, long-term impact of natural gas production on global climate, two facts remain:
(1) More studies are needed, and (2) the industry needs to be more transparent with regard to pollution disclosures, environmental concerns and public health concerns. Without transparency and complete life-cycle analyses, we will be hard-pressed to make informed judgments. CUB will continue tracking developments closely.
Burning Biomass
As the next installment in our continuing series on emerging renewable energy technologies, we examine new biomass projects in Oregon.
Here at the Citizens’ Utility Board we’re keeping an eye on emerging renewable energy technologies. In 2007, CUB supported the legislative effort to pass SB 838, a renewable portfolio standard that requires Oregon’s largest utilities to purchase at least 25% of their power from renewable sources by 2025. In addition to well-known technologies like solar, wind, and hydropower, Oregon’s Renewable Portfolio Standard (RPS) allows for the use of energy from the ocean, the earth, and biomass to be used to meet the standard. In May, we wrote about Oregon’s wave power potential ,and last week we covered geothermal energy development (part 1 and part 2). While we discussed torrefied biomass power as a part of our recent coverage of What’s Next For Boardman?, today we’re going to spend some time examining three biomass projects funded by grants from the Recovery Act.
Oregon state law ORS 469A allows the following types of biomass energy projects to be counted towards RPS goals: spent pulping liquor, woody debris from harvesting or thinning conducted to improve ecological heath, dedicated energy crops, hardwood timber grown on certain lands, agricultural residues, organic human or animal waste, and landfill gas or biogas (if produced from organic matter, wastewater, anaerobic digesters, or municipal solid waste). Oregon’s RPS explicitly excludes any biomass that burns municipal solid waste and wood treated with chemical preservatives.
In July 2010, Governor Kulongoski announced the award of $3 million in federal stimulus funds to biomass projects in Oregon. The exciting thing about these three projects is their development timeline: as a condition of receiving funds, these projects must produce energy by February 2012.
Lakeview Cogeneration
Lakeview Cogeneration LLC, a project in Lake County just 20 miles from the California border, was awarded $1.7 million. Financed by Iberdrola, the 26.8 MW project will produce enough power for 18,000 homes and provide heat to the Collins Fremont Sawmill to aid its lumber drying operation.
The project will be fueled by low-grade wood residuals. This low-grade wood residual will come from materials collected during forest thinning, scraps from the sawmill, and otherwise unusable residuals from nearby timber and forest management operations. The fuel will be burned in a boiler, which will create steam to turn a generator. The project also includes an air-cooled condenser, which will use 80% less water than other condenser technologies. The project is expected to produce 18 family-wage jobs at the site, and more in the surrounding community. For more information on the project, visit Iberdrola’s project website.
Wallowa County Wood Products
Integrated Biomass Energy, located at the Wallowa County Wood Products Campus, received a smaller award of $275,000. This cogeneration project will also use forest debris to create both heat and power for facilities located at the Wallowa County Wood Products Campus, including Smallwood Solutions and Biomass Resources.
Farm Power Tillamook
Farm Power Tillamook, the second project in Oregon’s renowned dairy country to use an anaerobic digester to create biogas-fueled electricity, was awarded $1 million in federal stimulus funds. The $4 million, one megawatt project will be owned by Washington-based Farm Power Northwest and located on Silvermist Farm.
The project will be fueled by methane gas produced from the manure of up to 2,000 cows. Manure will be collected from Martin Dairy and other nearby farms and transported to Silvermist Farm through underground pipes. Silvermist Farm will also supply manure, but no one is worried about this operation curbing the market on Tillamook County’s manure –the entire project can process only 1% of Tillamook County’s manure output.
The digester will receive liquefied waste and put it through an anaerobic process, which works best in wet, low-oxygen environments. To speed the process, the liquid waste is often heated to 100º F and injected with additional gases. Project developers estimate that digesting liquid waste into methane gas will take approximately three weeks. The methane gas is then piped into a generator where it is burned to create power that will be sold to the Tillamook People’s Utility District (TPUD) and to generate heat to keep the digester warm. The remaining waste is then converted into a nitrogen-rich fertilizer
Several permits needed for the operation of the project are secured, but a few remain outstanding. Tillamook County approved the project, and the Port of Tillamook Bay (which coincidentally operates the other digester in the county) will likely allow the project’s pipes on its property. The Power Purchase Agreement with TPUD is still under negotiation and the Oregon Department of Environmental Quality must approve the project’s air quality permit. Farm Power Oregon hopes to have the project running by March 2012.
Disposing of manure from dairy farms can be a risky endeavor. Some operations store the liquid waste in open lagoons, giving rise to concerns about odor, groundwater contamination, and methane gas emissions. It is important to address this waste, because methane is approximately 21 times more potent than carbon dioxide as a greenhouse gas and major contributor to global warming.
Critiques and Concerns
We covered the common critique that energy crops will displace food crops and therefore increase the cost of food in our post on Boardman; this concern does not appear to apply to the three projects discussed above.
The greenhouse gas emissions of biomass facilities are a serious concern compared to the other fuels used for power production. This year Massachusetts created more stringent standards for biomass generators seeking renewable energy credits. The rules require biomass plants to provide a lifecycle greenhouse gas emissions analysis and demonstrate emissions reductions of at least 50 percent over 20 years. This includes reductions accrued from the capture of carbon dioxide during the growth of the fuelwood, as well as emissions from fuel combustion for electricity generation. Additionally, the plants must operate at 60% or greater efficiency to receive a full renewable energy credit. Massachusetts’s requirement is a tall order, considering that even the Environmental Protection Agency (EPA) is unsure how to quantify emissions from biomass facilities. In January 2011, EPA delayed making a decision on how to regulate carbon dioxide emissions from biomass facilities while seeking “further independent scientific analysis of this complex issue.”
CUB is pleased to see the enthusiasm of project developers in Oregon’s biomass field, and we’ll continue to closely follow and scrutinize those proposed projects that plan to provide power to Oregon’s investor owned utilities.
Revised Residential Exchange Program Agreement – 93.8% of COUs and IOUs sign!
When was the last time you heard that 94% of the Northwest agreed on anything – you probably couldn’t even get 94% of the region to agree that it’s time for some summer weather. But 93.8% of the region has agreed to settle the decades-long dispute over allocating the benefits of federal hydropower. CUB is encouraged because it allows the region to focus on important topics such as keeping rates affordable, addressing the issue of wind integration and preparing for the changes in hydropower that will be caused by climate change.
As our faithful readers will know from reading CUB’s prior blogs on this topic, “CUB Signs the BPA REP Settlement Agreemtent” and “Revised REP Settlement Agreement”, an earlier version of this settlement did not meet the threshold for signers and was voided by its own terms. Many publicly-owned utilities (COUs), and all of the investor owned utilities (IOUs), state public utility commissions (PUCs) and CUB felt that we had come too close to let this deal just die – 81.5% of the publicly owned utilities, and all of the investor owned utilities had signed the original agreement meaning that 90% of the regional load was on board.
Given the above, CUB worked with a coalition of publicly-owned utilities, investor-owned utilities and the state commissions to draft a Revised Residential Exchange Program Agreement – this Agreement changed only the dates for signing and the threshold number of publics that had to sign for the Agreement to meet the conditions precedent to consideration and possible adoption and signature by the BPA Administrator. The revised threshold was set at 75%. This time 88.1% signed. Which goes to show that lowering the threshold, making the number seem more doable and providing more time for utilities to evaluate the benefits and risks of the settlement, had exactly the desired effect. For example, Clark Public Utilities (which serves Clark County, Washington) was the largest utility not to sign the first go around, but with the additional time, and the new threshold, Clark changed its mind and signed the agreement. As reported in ClearingUp 1495 [3/19]:
“Clark spokeswoman Erica Erland said the utility reversed course after concluding its vote was no longer pivotal in determining the overall outcome. She said that during Friday’s special meeting, Commissioner Carol Curtis, who made the motion to sign, said Clark is no longer pivotal, and since the settlement will go into effect regardless, the least risk to Clark’s customers for rate impacts or legal outcomes was to move forward.”
This is great news and was reported on by the the Oregonian.
If BPA Administrator Steve Wright adopts and signs the Revised Residential Exchange Program Agreement – which his staff is recommending that he do—this settlement would help resolve many of the disputes in the multitude of pending lawsuits related to BPA’s implementation of the Residential Exchange Program.
We have been waiting for the BPA Record of Decision (ROD) in the REP-12 proceeding which will signal whether or not the BPA Administrator intends to sign the Revised Residential Exchange Program Agreement. While the final ROD is not due until July, on June 14, 2011 BPA did issue its draft ROD. That draft ROD demonstrates that the Administrator intends to adopt the Revised Residential Program Settlement Agreement. Such a decision will provide greater financial certainty to BPA customers of all affiliations for the next 17 years.
With 93.8% of the IOUs and COUs in the region on board CUB eagerly awaits the BPA Administrator’s final record of decision – CUB hopes very much that he will sign authorizing adoption of the Revised Agreement by BPA. The BPA Administrator has until August 1, 2011 to sign.
While some may think it is too early to trumpet that “history has been made here today,” CUB likes to celebrate each milestone along the way. And readers this was a HUGE MILESTONE! Never before has 93.8% of the region agreed on anything – CUB is delighted with the progress made to date and thanks all those in the public power and investor owned communities who have come together to keep the dream of peaceful and equitable distribution of the federal hydro benefit alive in this region!
CUB Participates in PSU’s Smart Grid Class
There is a great deal of hype about the potential for the Smart Grid, which is generally defined as the emerging technologies that are updating our electric system in a way that enables a more efficient sharing of information. CUB has a vested interest in Smart Grid, as it is customers who will pay the billions of dollars necessary to pay for technology upgrades. We updated folks in April on what’s new and interesting in the field. CUB is a member of Smart Grid Oregon and will continue to monitor OPUC docket UM 1460, which included a recent order requesting the utilities to develop more information about the various Smart Grid technologies and practices they are considering.
Smart Grid isn’t just a regulatory matter, however—it will also affect consumers at every level throughout Oregon. To address some of these concerns, Portland State University professor Jeff Hammarlund, in conjunction with a number of other knowledgeable Smart Grid advocates, offered his Winter term course on Smart Grid Policy.
CUB Executive Director Bob Jenks was invited to speak to the class in February , discussing strategies for integrating Smart Grid for the utilities and the benefits and risks of different Smart Grid applications. Some programs, such as Emerald PUD’s water heater program, offer the potential for customers to reduce peak usage (by reducing the temperature of hot water heaters) with little impact on customers. Other programs, such as time-of-use pricing, could harm low-income customers who have electric heat. Utilities face a number of challenges when considering the implementation of Smart Grid technologies, including how to balance costs with concerns that many of these applications have great, yet unproven, potential.
The class, comprised of professionals from an array of different companies and organizations with an interest in Smart Grid, produced two policy briefings—one on the integration of wind resources into the Smart Grid, and one on the concerns of low-income consumers as Smart Grid and its related policies are developed. Business Director SA Anders contributed to the low-income team’s project. CUB’s General Counsel, Catriona McCracken, participated in the simulated blue-ribbon panel that reviewed the two student developed policy briefings.
One of the major concerns with wind integration to the Smart Grid is that, as a variable power-generating resource, wind is not an ideal energy source for baseload power. It is, however, an excellent resource for offsetting peak demand energy use, especially if the power generated can be stored or otherwise utilized in smart devices—like water heaters or electric vehicles. The wind integration team presented a set of options that would encourage large-scale utilities to embrace new ways to manage and distribute power, such as virtual power plants like this model in North Carolina:
The low-income team’s main concern was the protection of underserved, at-risk consumers as the utilities move towards Smart Grid technologies and practices that will change how consumers are encouraged to monitor their energy use. Folks working on a limited or fixed income often don’t have the time, money, or resources to adapt to a more variable rate structure. The low-income team, following discussions with a representative from Community Action Partnership of Oregon and from CUB, suggested that providing a different rate structure to at-risk customers that would allow them to budget more effectively against their energy use would offer more consumer protection. The team offered a set of policies that would allow low-income consumers to opt-in to more demanding Smart Grid programs (such as time-of-use pricing) if customers wanted to take advantage of the opportunity to more closely monitor their energy use under a different rate structure.
These two presentations were well thoughtfully developed and show cased tenable solutions to some of the many challenges of Smart Grid integration, both here in Oregon, and throughout the region. We commend the class, and Jeff Hammarlund, for providing a compelling platform to investigate and discuss Smart Grid.
And stay tuned readers—CUB will be announcing its own exciting Smart Grid program soon!
Geothermal Power in Oregon-Part II
In Geothermal Power in Oregon– Part I, we explained how geothermal energy works and gave an overview of past, present and potential Geothermal Projects in Oregon. Part II aims to outline the advantages and disadvantages of geothermal power as well as give a brief summary of the future outlook for geothermal energy.
Advantages
Despite there being very few known high temperature geothermal resources in Oregon, there is ample reason to develop geothermal power. Geothermal has a high capacity factor and provides dependable base-load power that can be used to replace coal-fired power plants, which means that actual power production is usually very close to a plant’s rated capacity. This reliable form of renewable energy is more valuable to utilities than variable resources like solar and wind.
Geothermal energy also has environmental advantages, such as a small footprint and low emissions. Geothermal power plants are smaller than coal plants and do not require coal mining or coal transportation infrastructure, and unlike utility-scale solar and wind, geothermal plants only require the space directly surrounding a geothermal well. Geothermal plants use 1-8 acres of land per MW installed, compared to 5-10 acres for nuclear, 19 acres for coal, 4.5-13.5 acres for solar, and 60- 85 acres for wind. In addition to using less space, many geothermal power plants produce nearly zero emissions, since binary systems can inject well water directly back into the ground in a closed loop. Carbon emissions from open systems vary greatly depending on the source, but generally speaking are less than 5% of what is emitted to produce the same amount of electricity using coal.
Disadvantages
Of course, geothermal energy also has limitations and risks associated with it. The biggest constraint to geothermal energy is location. Piping hot water over long distances is not economical, so geothermal applications must be located very close to the resource. Geothermal power plants can be connected to the grid, but are often in remote areas that require significant investment in transmission and interconnection facilities. Geothermal development can also pose a threat to aesthetic quality, since resources are frequently located near geological features or scenic areas.
Because location is a major consideration, land ownership and property rights also play a major role in geothermal developments. There are numerous geothermal resources on public property, but there are significant legal and administrative challenges to developing a project on public property. The application for developing geothermal on public property can take many years to complete and does not always result in approval. Developing geothermal applications on private land is less complicated, but known geothermal resources exponentially increase the value of land and the cost to acquire it. In Oregon, a large majority of land is public; however, both the Neal Hot Springs and Crump Geyser projects are being developed on private property.
In addition to being limited by resource location and availability, there are other risk factors present for developing geothermal power. The cost to drill a single exploratory well to confirm that a significant heat source exists in a certain location can run between $2-5 million. Since there is no way to predict the temperature of a geothermal resource until an exploratory well is sunk, up-front costs to identify and confirm geothermal properties are very high. Even if a geothermal resource is confirmed, a long-term power purchase agreement must be signed to ensure that the project will be financially viable. According to the U.S. Department of Energy, geothermal power plants cost around $2,500 per installed kW and require a power purchase rate of approximately $0.05 per kWh to be commercially viable.
Building and operating a geothermal system also poses a risk of seismic activity, or seismicity. This is not only dangerous to the geothermal operation, but to the entire area. Geological surveys and studies may indicate that there are no active faults in the area, but dormant fault lines may be triggered due to the operation of geothermal energy systems. There is a risk that earthquakes could be induced by geological changes from harnessing geothermal energy, so safety must be a top concern while developing geothermal power.
Future outlook
Available technology is only capable of capturing a small fraction of the near infinite supply of geothermal energy. Current research is focused on drilling deeper wells to access more heat at higher temperatures, increasing the permeability of dry rock to create new reservoirs or to enhance existing resources, expanding permeable area to increase reservoir size, and utilizing lower temperature heat to generate electricity. While new technology is developing, it is important to continue utilizing direct-use systems, as new power plants may be slow to develop. Expanding direct-use geothermal systems is particularly important in Oregon, where there are known low to moderate temperature resources that can be utilized to provide proven energy and cost savings.
Geothermal Power in Oregon-Part I
As the next installment in our continuing series on emerging renewable technologies, this post will examine geothermal energy, focusing on the status of Oregon’s geothermal development, as well as the benefits and limitations of geothermal power. Just like other emerging renewable energy technologies, such as wave power and biomass, geothermal can also be used to meet Oregon’s Renewable Portfolio Standard (RPS). Last week, Alex Sifford, a well-respected consultant on geothermal projects, gave CUB a briefing on the state’s interests in geothermal.
Intro
The term geothermal literally means heat from the earth. The earth is constantly producing heat at its core, which can be harnessed to meet both heating and energy needs. Naturally occurring instances of geothermal activity include hot springs, geysers, and volcanoes. Underneath the earth’s surface there are geothermal reservoirs, where heated water is trapped in the ground and can reach temperatures up to 350°C. To access this form of energy, wells are drilled into the ground that can extend over two miles deep. Depending on the geological structure and the amount of heat available, geothermal power can take many forms.
Geothermal reservoirs are grouped into three categories based on temperature. Low (less than 90°C) and moderate temperature (90°C -150°C) resources can commonly be found in “direct-use” heating buildings and district heating projects, or applied for industrial purposes. Hot water from geothermal reservoirs can also be used in agriculture and aquaculture. High temperature (great than 150°C) and some moderate temperature geothermal resources can be used to generate electricity.
There are three ways that geothermal resources can be converted to power. Existing geothermal power plants are predominantly flash steam systems, which extract hot pressurized liquid and turn it into steam to drive a turbine. A small number of geothermal resources are already accessible as steam. Rather than going through the flashing process, these can be used directly in a dry steam plant to produce electricity. Moderate temperature geothermal resources may not be suitable for flash steam plants, but can still be used to generate power through a binary-cycle plant. This type of power plant uses a heat exchanger to heat a secondary fluid, which vaporizes at a lower temperature. Some hybrid plants combine flash steam and binary systems to extract additional heat from geothermal resources. Since moderate temperature resources are more common and binary systems use reservoir water more efficiently, future geothermal power plants will predominantly be binary-cycle plants.
If geothermal resources are limited, the earth can still be used to create ground-source heat pumps. Since ground temperatures remain relatively constant regardless of seasonal changes in air temperature, the ground can be used to supply heat during the winter and cool buildings during the summer. Geothermal heat pumps do not need geothermal wells, and instead rely on piping fluid into the ground beneath or next to a building. Since no geothermal resources are required, ground-source heat pumps can be installed almost anywhere in the world.
Geothermal Resources in Oregon
In Oregon, geothermal exploration has occurred intermittently since 1959, leading to the discovery of many direct-use resources and some possible high temperature resources. Over the last 30 years, there have been several isolated attempts at power generation projects, but none are currently in operation. In 1982, two projects developed by Solar Power Systems were in operation, but both encountered technical difficulties and are no longer in operation. In 1995, plans for a 23 MW binary power plant in Pueblo Valley were scrapped after the developer Anadarko was unable to secure a power purchase agreement. Until recently, there has been very little activity in geothermal exploration.
There are an estimated 630 applications of direct-use geothermal in Oregon which collectively provide over 174,000 MWh of energy per year. A majority of the eastern two-thirds of the state contain some geothermal activity, and as a result a number of cities and towns use geothermal resources for heating, industry, and agriculture. The most notable system is in the City of Klamath Falls , which has a heating system that melts snow on bridges and highways and provides heat for downtown buildings. Overall, direct-use geothermal is well utilized in Oregon , but still has significant potential for further development. Many communities across the state could easily access known geothermal resources and are ripe for collocation opportunities. The Oregon Institute of Technology estimates that Oregon’s direct-use geothermal potential is 4600 MW over 30 years, and that as of 2007, only 1.4% of that potential is being utilized.
Currently, there is no electricity generated from geothermal sources within the Oregon, but two projects should soon change this. One project, located at Neal Hot Springs , is led by US Geothermal, Inc. and plans to sell its 26 MW output to Idaho Power Company starting in 2012. The second project is a joint venture between Nevada Geothermal Power and Ormat Nevada, Inc. to build a 30 MW plant at Crump Geyser . Nevada Geothermal Power is currently drilling exploratory production wells, and the project is expected to go online in 2013. Both the Neal Hot Springs and the Crump Geyser will use binary-cycle geothermal power plants.
Even with a combined 56 MW set to come online in the next few years, there is potential for Oregon to significantly increase its geothermal electricity production. The Newberry Known Geothermal Resource Area has recorded temperatures of 265°C in 1980, but lacks the steam or water to produce power with technology that is currently available. AltaRock Energy and Davenport Newberry are currently pursuing a new unproven technology called Enhanced Geothermal Systems (EGS) to build a power plant at Newberry. Outside of Newberry, there are very few known high temperature geothermal resources within Oregon. Other sites with high temperature resources may exist, but the extent of these resources will not be known until a developer drills a costly exploratory well to prove the site’s viability.
Part I on Geothermal Power in Oregon has given a brief introduction to how geothermal energy works as well as an overview of past, present and potential geothermal projects in Oregon. Part II will outline the advantages and disadvantages of geothermal power as well as give a brief summary of the future outlook for geothermal energy.
Fishing for Wind in High Water
The Bonneville Power Administration (Bonneville) is the custodian of the Pacific Northwest’s federal power supply and the manager of dams on the Columbia River. Bonneville is required by law to encourage the development of renewable energy in its service area, including a sizeable and growing fleet of wind power generators, while at the same time providing federal power to residential customers and protecting endangered fish species. It is Bonneville’s responsibility to balance these interests, and new policies to meet the needs of renewable energy integration are increasingly necessary. The latest chapter of this balancing act was the publication of Interim Environmental Redispatch and Negative Pricing Policies Record of Decision, and the widely divergent comments filed in response.
Heavy Flow and Strong Winds
The Federal Columbia River Power System (FCRPS), including the Pacific Northwest’s hydroelectric dams, are operated in order to produce electricity, control floods, provide water for municipal uses and irrigation, and protect the river’s fish populations. In order to protect fish populations, Bonneville is required to manage the amount of water that is run through dam generators, spilled over the top of dams, and maintained in reservoirs. For the past two weeks, with water flow at its annual peak, Bonneville has struggled to maintain its obligation to protect juvenile fish populations by keeping Total Dissolved Gas (TDG) levels within Clean Water Act and Endangered Species Act limits. In response to this high flow of water, Bonneville made arrangements to run more water through its generators, which creates less bubbles of air and TDG than spilling water over the dams. Like most actions from this agency, this is controversial. Some fish advocates are strong proponents of increasing the amount of water spilled, believing that the benefits to fish outweigh the risks associated with gas bubbles.
As a Balancing Area Authority (BAA), Bonneville is required to maintain a balance between total electric demand (load) and total electric generation on its system. Bonneville does this by utilizing the flexibility of the FCRPS to quickly increase or decrease its output based upon the needs of variable generators and the electric load of the Northwest. A significant portion of this flexibility is used to compensate for wind energy’s inherent variability.
Each spring as runoff increases, Bonneville manages the heavy river flow to protect fish populations by keeping TDG levels within legal limits. In order to keep TDG levels low, Bonneville runs more water through the dams’ generators and creates more power. In order to balance the addition of this unscheduled power on its system, Bonneville first freely gives away the power, adjusts the level of reservoir reserves (including pump reserves), reduces generation at other generation facilities, and operates hydro projects inefficiently.
In response to Bonneville’s offer of free hydropower, many fossil fuel-powered generators shut down, saving the cost of fuel those generators would have incurred by running. Wind generators, which do not have fuel costs and must produce energy in order to receive renewable energy credits (RECs) and federal production tax credits (PTCs), do not voluntarily stop generating power. Voluntary actions did not reduce power generation enough, so in the last two weeks Bonneville ordered wind generators to stop producing power, resulting in lost income for wind developers. Instead of ordering other generators not to produce, wind developers urged Bonneville to pay wind facilities not to produce.
Bonneville specifically decided not to pay negative prices for its energy, providing two explanations to support this decision (see page 12 of the Record of Decision). First, paying negative prices is not “consistent with traditional principles of cost causation,” since Bonneville’s preference customers in the Northwest would pay the cost of displacing wind generation, while the majority of wind power is sent to California. “The costs of Federal and state production incentives should be borne by a broad group of taxpayers and ratepayers receiving the wind power, not concentrated on [Bonneville’s preference] consumers with limited economic interest or benefits from the renewable generation.” Second, Bonneville “believes that its statutory responsibilities and the objectives of the Northwest Power Act would be frustrated if BPA were required to pay negative prices in order to ensure compliance with BPA’s environmental obligations.”
The legal limit of total dissolved gases used to protect fish is in dispute
Save Our Wild Salmon Coalition responded to Bonneville’s proposed policies by arguing “that there is no need to pit salmon and wind farms against one another,” contending that Washington state’s 115% TDG “standard contradicts the best available science and stands in opposition to the 120% level put in place by the State of Oregon that would allow for more spill at these same dams.” Moreover, Washington state’s TDG standard is under attack in the Thurston County (WA) Superior Court. (See Northwest Sportfishing Industry Assn. v. Wash. Dept. of Ecology, Case No. 10-2-01236-0). In addition to arguing that higher TDG limits will not harm fish, wind developers point out that operational measures can be taken to decrease the potential of, or eliminate the need for, environmental redispatch.
Additional steps can be taken to maximize the flexibility of Bonneville’s transmission system
Detractors of the Environmental Redispatch policy argue that the use of intra-hour scheduling and dynamic transfers can maximize the flexibility of the FCRPS and defer, if not eliminate, the need for environmental redispatch. Intra-hour scheduling reduces the need for large balancing reserves, and dynamic transferring allows the real-time movement of power from one BAA to another. Both practices will allow Bonneville to run more water through the dams’ turbines and reduce TDG levels. Page 9 of Bonneville’s Record of Decision notes that “[t]o the extent [intra-hour scheduling will] successfully help accommodate the variability of wind generation, BPA hopes to be able to partially reduce reserve amounts. Continued growth of wind generation, however, will require BPA to increase the amount of reserves it must carry. As a result, while intra-hour scheduling may help reduce reserves in the near term, it will not solve the overgeneration condition itself since the region will still face more on-line generation than there is load to absorb it.”
Currently, Bonneville and most western states schedule power transmission on an hourly basis. For example, a wind facility predicts that it will produce 20 MW for the hour. 20-30 minutes ahead of the start of the hour, the facility schedules 20 MW of transmission for the hour, and this schedule generally cannot be modified. Due to the wind facility’s intermittent nature, it will likely produce less than 20 MW of power for a portion of the hour, and may produce over 20 MW for a portion of the hour. These inaccuracies are compounded by the fact that transmission schedules are often 90 minutes old by the end of the scheduled hour. In order to ensure that enough power is always available to serve the BAA’s load, the BAA maintains “balancing reserves,” which are fast-responding generation facilities that have the ability to compensate for the difference between the scheduled output and the actual output.
Intra-hour scheduling allows generation facilities to schedule their transmission in 15 or 30 minute intervals. Scheduling in smaller increments of time produces more accurate schedules and results in less deviation of actual production from scheduled production. In addition, intra-hour scheduling limits the lag time between scheduling and power production. The increased accuracy resulting from intra-hour scheduling will likely result in the need for less balancing reserves. Bonneville uses the FCRPS dams as balancing reserves, so when more reserves are needed, less water is guaranteed to flow through the turbines of the dams. As a result of implementing intra-hour scheduling, Bonneville will likely be able to hold less balancing reserves and guarantee that more water can flow through the dams’ turbines.
Transmitting power between BAAs on an intra-hour schedule is facilitated by dynamic transfer systems that enable the real time monitoring and administration of energy transfers. Allowing the transfer of power to other BAAs on an intra-hour schedule can also reduce Bonneville’s need for balancing reserves and guarantee that more water can flow through the turbines.
A regional effort to allow intra-hour scheduling and dynamic transfers in the western states is currently underway. This voluntary effort is known as the Joint Initiative and will allow for the scheduling of generation and transmission in 30 minute intervals. Bonneville has partially implemented this practice, and plans to participate in a wider rollout of intra-hour scheduling on July 1, 2011. Moreover, the Federal Energy Regulatory Commission issued a “Notice of Proposed Rulemaking for the Integration of Variable Energy Resources” which, if implemented, will require scheduling in 15 minute intervals.
An Uncertain Flow
The Citizens’ Utility Board has not issued an opinion on Bonneville’s Environmental Redispatch policy. Most publicly-owned power producers support it, and almost all other stakeholders oppose it. As the spring runoff season continues and the next chapter of Bonneville’s balancing act is written, renewable energy developers hope that policies that allow for the continued expansion of wind power are implemented. Developers facing Environmental Redispatch policies complain of lost profits and fear that these policies will stunt the growth of renewable energy in the Pacific Northwest. Accordingly, wind developers have asserted legal claims against Bonneville’s policy and will likely appeal the decision implementing this policy to the courts.
CUB will continue to monitor the impacts of high flow and wind development on the region’s power supply, but we do not anticipate taking a position on this contentious issue.
What’s Next for Boardman?
The Citizens’ Utility Board (CUB) has been actively involved in the unprecedented process that will end the burning of coal at Portland General Electric’s (PGE) Boardman power plant. On this blog we described how the most effective arguments in support of closing the plant were economic, not environmental. In December 2010 we reported on the long journey that resulted in the first agreement to close a modern coal plant before the end of its intended life. Today, as a part of our ongoing series exploring emerging renewable energy sources, we are looking at the options for repowering the Boardman plant.
PGE plans to discontinue burning coal at Boardman by the end of 2020. What will happen to the Boardman plant when that occurs? Although no plans are final until approved by the Public Utility Commission, there is a process underway which will determine whether it would be feasible to retrofit the plant and to burn torrefied giant cane grass in a plant originally built to burn coal.
Giant cane grass looks similar to bamboo (see photo). Today it is used as an ornamental plant and as a reed in woodwind instruments. Giant cane grass can be grown in marginal soils with low nitrogen content, is harvested twice a season, and is high in energy content. Tests conducted by Washington State University near Boardman show that each acre of irrigated land can produce 25-30 dry tons of cane grass. Additionally, giant cane grows up to 30 feet tall and no pesticides are necessary to grow the crop in Oregon.
PGE estimates that 60,000 to 90,000 acres of giant cane would need to be planted to supply the retrofitted plant’s needs. Today approximately 220,000 acres of irrigated cropland is located within 50 miles of Boardman; keeping production close will reduce the cost and carbon emissions from the transportation and aggregation of cane grass.
A common critique of biomass production is that energy crops will displace food crops and therefore increase the cost of food. PGE plans to pay giant cane farmers an amount comparable to the cost of crops that are used for animal feed. PGE contends this will prevent displacing high-value food crops, such as potatoes, that are grown in the area. CUB is sensitive to this issue and will further examine land availability and PGE’s plans before supporting any final proposal.
Another potential concern about giant cane grass is its ability to spread beyond the fields in which it is planted. In California, giant cane is considered an invasive species, but in Oregon’s climate the crop cannot produce its own seeds. As a result, the only way for giant cane to reproduce is if part of its root structure is torn out of the ground and comes to rest in a new location. This has been observed in areas where flooding or turbulent streams frequently modify the landscape. The Oregon Department of Agriculture rates giant cane a risk category B weed. Current plans call for the spread of giant cane to be managed by: (1) planting only outside of riparian areas and the 100 year floodplain, (2) not planting near running water, and (3) controlling transportation practices. This plan also calls for any unexpected spread of giant cane to be controlled by a denial of water or the application of common herbicides.
A further concern about the introduction of an irrigation-dependent crop is its potential to deplete the aquifer in the area. PGE responds that giant cane grass uses the same amount of water, about 30 inches per acre, as the alfalfa it is expected to replace. CUB recognizes that this issue also needs further study, as does the question of whether there are any significant risks of relying on a monoculture to grow an alternative fuel source.
Giant cane grass must be torrefied in order to be used at Boardman. Torrefaction is a cutting-edge technology that heats the crop in a low oxygen environment. After heating the giant cane (imagine bamboo in a giant coffee roaster), a charcoal-like substance that has an energy content of 10,000 BTUs (British thermal units) per pound is produced. This torrefied cane has higher energy content than the coal used in the plant today. Torrefied cane is also low in sulfur and mercury, so it will burn cleaner and more efficiently than coal.
While the process of harvesting, torrefaction, transportation, and burning of giant cane may emit less carbon than burning coal, a greenhouse gas life cycle analysis needs to be conducted by a respected scientist. Even the Environmental Protection Agency (EPA) is unsure how to quantify emissions from biomass facilities. In January 2011, EPA delayed (for several years) making a decision on how to regulate carbon dioxide emissions from biomass facilities while seeking “further independent scientific analysis of this complex issue.” A full analysis of this proposal’s environmental impact will include an accounting of greenhouse gas emissions.
In addition, while burning torrefied cane results in fewer sulfur and mercury emissions than coal, a repowered Boardman plant may require additional pollution controls. The economic analysis of Boardman as a coal plant demonstrated that it would cost about $200 million less to close the plant and avoid pollution control investments. Pollution control costs may also influence whether Boardman is cost effective as a biofuel plant.
Under its pilot program PGE is contracting with local farmers to grow giant cane on approximately 100 acres. The company plans to conduct a 24 hour test in 2013 during which only torrefied biomass will fuel the Boardman plant.
PGE hopes that this test fire, along with other research, will provide information permitting it to keep Boardman open, with minimal retrofitting, past 2020. PGE also hopes that such a step would preserve the 100-plus jobs at the plant and create 60 new jobs at three torrefaction facilities in the area. PGE will examine the results of the test batch before proposing to continue operating the power plant on giant cane grass. Constructing torrefaction facilities will cost between $350 and $450 million, and CUB isn’t ready to support such a large investment until more information on the cost and benefits of this proposal are available. If PGE submits a long-term proposal to use torrefied giant cane at Boardman, CUB will carefully examine the proposal’s impact on food production, carbon emissions, water use, other environmental risks and concerns, and utility rates.
In the mean time, we’re looking forward to seeing the results of the test fire. We will also keep an eye on other emerging renewable energy technologies that are proposed for use in Oregon.
Oregon’s Global Warming Roadmap Needs Your Input
The Oregon Global Warming Commission OGWC is seeking public comment on its recommendations for reducing Oregon greenhouse gas emissions that were published as The Interim Roadmap to 2020. This roadmap was created to help Oregon meet its goal of reducing greenhouse gas emissions 10% by 2020 and 75% by 2050. You can provide comments on the roadmap by taking this survey, and read on for more information on the roadmap and the history of the OGWC.
In 2007, the Oregon legislature passed House Bill 3543, which set targets for reducing Oregon’s greenhouse gas emissions. CUB was a key part of the coalition that supported the bill and former staff attorney Jason Eisdorfer was part of the negotiating team that finalized the bill. Although data is not yet available for greenhouse gas emissions in 2010, the 2011 Report states that “emissions trajectory will stay flat (on average) through 2010.” The objectives set forth in HB 3543 are as follows:
• By 2010, arrest the growth of Oregon’s greenhouse gas emissions and begin to reduce greenhouse gas emissions.
• By 2020, achieve greenhouse gas levels that are 10 percent below 1990 levels.
• By 2050, achieve greenhouse gas levels that are at least 75 percent below 1990 levels.
In addition to establishing reduction goals, HB 3543 created the Oregon Global Warming Commission (OGWC) and the Oregon Climate Change Research Institute (OCCRI) to facilitate the achievement of emissions reductions. The OGWC came to life in March 2008 when then Governor Kulongoski appointed the 11 voting members of the 25 member commission. The commission submitted its first Biennial Report to the Oregon Legislature in 2009 and in 2010 began the “Roadmap to 2020” project, which gives recommendations on how Oregon can meet its greenhouse gas reduction goals for 2020 and start addressing its 2050 goals.
As of October 2010, the OGWC has completed its initial recommendations for the “Roadmap to 2020” project. This document is a compilation of work from six technical committees and is incorporated into the Commission’s 2011 report to the legislature. In order for the interim label to be removed from the OGWC document, it will go through three refinement processes. One refinement will improve the quantitative basis of the roadmap. Another refinement will balance the actions recommended by each of the six technical committees. The third refinement will be a public comment process, which will review all of the Commission’s recommendations. The feedback gathered during public review will be taken into consideration for revisions before the document is finalized.
There are two ways that you can get involved with the review process for this document. First, you can take the OGWC online survey. The survey takes approximately 15-20 minutes when answered thoroughly and is open through the end of May. Survey questions are a combination of multiple choice and open ended comments that ask questions about climate, your recreation habits, and energy preferences.
Second, public workshops are being held throughout the State in May and June. Please see the schedule below or click here to find the workshop that is closest to you.
City of Eugene - May 26, 6 - 9 pm, Eugene Hilton - Please RSVP to .(JavaScript must be enabled to view this email address) or to the City of Eugene Office of Sustainability (541) 682‐5649
City of Bend - June 2, 7 -9 pm, Location TBD
City of Portland/Multnomah County METRO - June 9, 7 - 9 pm, Location TBD
Your input is a valuable component to developing a roadmap that incorporates all of Oregon’s stakeholders. Although “the Commission members represent a diverse range of experts in the social, environmental, cultural and economic interests of the state,” the public process is crucial for involving all of Oregon’s citizens. It’s important to note that there has been little additional action taken up by the legislature since 2007, even on very narrow proposals to develop better data to inform future policy discussions. Oregon can’t afford to sit back on our laurels when it comes to reducing our greenhouse gas emissions and playing a lead role in the issue nationally. Emission reduction efforts to date have been able to stop increases in State greenhouse gas emissions, but achieving the 2020 and 2050 goals will require input and effort from every Oregonian.
Be a Part of the Solution with Clean Energy Works Oregon
The Northwest Power and Conservation Council, the agency which charts the course of the region’s electricity system, begins its most recent plan by saying the “improved efficiency of electricity use is by far the lowest-cost and lowest-risk resource available.” At CUB we’re always supportive of low cost, environmentally friendly power plans, so we fully support the Council’s goal to meet 85% of the Northwest’s load growth over the next 20 years through energy efficiency. This means that although projections show that in 2030 the region will use 7,000 average megawatts more of energy than we did in 2009, 5,900 average megawatts of this growth can be met by an ambitious plan to cut energy use.
Residential homes consume about 40% of the region’s total electricity use, so most of these savings will come from inside your or your neighbors’ homes. Many homes in the Northwest were built decades ago with little or no insulation because in the past it was cheaper to heat your home with electricity than to invest in insulation. Today, in order to meet the efficiency goals set by the regional power plan, tens of thousands of homes must be retrofitted to use less energy overall.
This is a daunting task. Skeptics argue that it is impossible to get tens of thousands of individual homeowners, each with different schedules, family obligations, and housing needs, to complete the costly and intrusive process of remodeling their nest egg to be more efficient. Clean Energy Works Oregon has an answer to this collective action problem: streamline the process of finding the most cost-effective upgrades, and then provide financial incentives for individuals to retrofit their homes.
Clean Energy Works Oregon is a nonprofit public-private partnership that allows Oregon’s homeowners to get a package of services, including an energy audit, home remodel, cash grant, and low-interest loan, from qualified professionals. By providing access to all of these services through one application, the program simplifies the process of retrofitting a home to save energy and makes an energy remodel attractive to homeowners.
Clean Energy Works Oregon recently opened its program to homes that are:
• owner-occupied,
• single family detached buildings built before 1993,
• in Clackamas, Jackson, Josephine, Multnomah and Washington Counties (other areas including Lane, Clatsop, Deschutes and Coos Counties will be added shortly).
How does the program work? First, a homeowner completes an on-line application. Then, if the homeowner qualifies, she receives a free in-home energy audit (valued at $500) from a qualified professional, who sets benchmarks for improvements in her home’s energy efficiency and comfort. Informed by the audit, the homeowner determines the scope of the retrofits. Then, Clean Energy Works Oregon arranges for a bank or credit union to provide a low interest, no money down loan to fund the retrofit work. Local contractors, certified by the Building Performance Institute and partners of the Energy Trust of Oregon, then perform the retrofit work on a schedule that is convenient for the homeowner.
Once the retrofit is complete, the contractor performs a quality assurance review to make sure that the home will reach the energy savings benchmarks established in the audit. Then, the homeowner is responsible for repaying the loan, most often through a new charge that appears on her monthly utility bill.
Clean Energy Works recently completed a pilot project with 500 homes in the Portland area. In that program, most homes realized a 30% or greater energy savings. Today, the program projects average savings of about $55 per month, with a monthly loan payment—while the largest rebates are still available—of roughly $69 for 15-20 years. This means homeowners can complete a remodel with no money down and a relatively minor impact on their monthly expenses.
The effect on homeowners, whose less drafty houses will be more comfortable and new windows easier to clean, are easy to quantify, but the implications for Oregon’s economy should not be understated. Over the initial three-year course of the program, Clean Energy Works Oregon expects to complete 6,000 residential retrofits, which will produce 1,300 family-supporting jobs.
CUB encourages all qualified homeowners to join the ranks of Clean Energy Works and help the region meet its energy efficiency targets. To apply and find out if you qualify for the largest rebates, which are awarded on a first-come, first-served basis, visit http://www.cewo.org.
CUB Executive Director Bob Jenks, whose home was built in 1926, will experience this process first hand: Bob plans to apply in the near future, and will update CUB followers with his experience in this program.
CUB Lobby Day 2011
On Wednesday, May 4 CUB board members, staff, interns and volunteers headed down to the state capitol to speak to our representatives about three important issues currently in the Oregon legislature. CUB Lobby Day is a way for the staff and board of CUB to meet their legislative representatives, to better understand CUB’s role in Oregon’s policy making process and to help our representatives better understand CUB’s position on bills that are making their way through the current session.
CUB folks were able to meet with over 20 state senators, representatives and legislative staffers from our districts and speak to them about some important bills that CUB is endorsing.
Senate Bill 967 – Utility Tax Law Reform
This bill reforms existing statutes governing adjustment of public utility rates to account for taxes paid by electricity and natural gas utilities. This bill will override SB 408, which passed in 2005 with CUB’s support. Here is CUB’s analysis of the bill from 2005. Unfortunately, the implementation of SB 408 has proven to be incredibly complex and the “true-up” adjustments—originally intended to make sure that companies are not overcharging customers for taxes—are causing utilities to add surcharges to utility bills that are unrelated to phantom taxes. In April, we published a detailed blog digging into why CUB Supports Utility Tax Law Reform.
The representatives we spoke with were very interested in discussing CUB’s position on the bill. Representative Mitch Greenlick from District 18 requested more information from CUB, emphasizing that he is weary of any bill that is too complicated for people to understand. CUB is making sure to follow up with a clear explanation of our support for SB 967 so that we can ensure it passes in the house.
SB 967 is supported by CUB, state regulators, utilities and industrial customers because all parties agree that the current true-up mechanism has unwanted, unintended consequences. CUB believes that we can get rid of the mandate of an annual true up but still retain the original goal of SB 408 – ensuring that taxes paid by consumers reflect the amount of taxes that a utility pays to state and federal governments. SB 967 passed the House Business and Labor Committee, which is responsible for preparing it for the House floor vote. The bill already passed in the Senate unanimously.
Senate Bill 863 – Utility Bill Assistance for Low Income Families
This bill is a temporary fix to ensure that low-income families can receive utility bill payment assistance during hard economic times. Oregon faces losses up to $20 million in federal funds to support utility bill assistance, and this legislation would address those losses. The bill requires that electric utilities collect an additional $5 million per year for two years from residential ratepayers in order to support funds that are necessary for low-income Oregonians to keep their lights and heat on over the winter.
SB 863 is only a two year temporary fix and an important measure to support during a time of high unemployment, reduced incomes and higher bills. The bill also requires appointment of electric utility representatives and CUB representatives to an advisory committee on energy in the state. In January, 2014, when the provision sunsets, CUB will work hard to find and promote a more sustainable solution.
SB 863 is currently in the Senate Finance and Revenue Committee. It already passed the Senate Business, Transportation and Economic Development committee unanimously.
House Bill 2960 – Cool Schools - Increased Energy Efficiency in Schools
On April 27, 2011 we posted an update about HB 2960 and outlined why CUB supports this important legislation. In summary, the Cool Schools bill requires the State Department of Energy to establish a pilot program and a clean energy deployment program that supports energy efficiency and clean energy projects in public schools. This bill is not based on establishing a new tax credit; instead, it enables school districts to utilize existing public purpose funds. The bill changes the Loan Offset Grant Fund to the Jobs Energy and Schools Fund. If passed, school districts will be able to apply for loans or grants for energy projects including weatherization, upgrades and retrofits to their school buildings.
Energy efficiency is the least cost energy that is available. Investments in energy efficiency reduce costs for the utility and all its customers, avoiding the need to generate more expensive power. The Cool Schools proposal will not only benefit all utility customers by reducing costs, it will have the additional benefit of reducing the cost of heating our schools and allowing school districts to use that savings to improve education programs. CUB strongly supports this bill and encourages our members, followers and partners to contact your representative to offer your support. To find your legislator’s contact information, you can go to: http://www.leg.state.or.us/findlegsltr/.
HB 2960 is currently in the Ways and Means committee.
Overall, CUB Lobby Day was a success and a great opportunity to talk to our representatives about the issues that are important to us, Lobby Day helps us, and you, understand the state legislative process and support CUB’s critical legislative efforts. We will make sure to keep you updated as the 2011 Legislative Session continues.
Wave Power in Oregon
Here at the Citizens’ Utility Board we’re keeping an eye on emerging renewable energy technologies. In 2007, we supported the legislative effort to pass SB 838, a renewable portfolio standard that requires Oregon’s largest utilities to purchase at least 25% of their power from renewable sources by 2025. In addition to well-known technologies like solar, wind, and hydropower, the law allows for energy from the ocean, geothermal sources, and biomass to be used to meet the standard. Over the next few weeks, we’re going to take a look at some of these lesser-known renewable technologies on our blog. Last week we were fortunate to spend some time with Jason Busch of the Oregon Wave Energy Trust (OWET), so in this post we are going to explore the potential for ocean energy off Oregon’s coast.
One important note about ocean energy is that this technology is still in the research and development phase. While off-shore wind farms generate hundreds of megawatts of electricity today, the same cannot be said for wave energy. From 2004-2009, approximately six prototype devices were demonstrated around the world, two of which were deployed off the Oregon coast. In this early stage of development even the design of these devices is uncertain. Much like wind turbines thirty years ago, when manufacturers were not sure how many or what type of blades produce the most power, today we do not know what ocean energy technology will prove the most efficient. This presents a great opportunity for entrepreneurs interested in developing ocean power, many of whom are located in Oregon.
Oregon is uniquely positioned to lead the nation and the world in wave energy development. The waves off the Oregon coast are among the strongest anywhere in the lower 48 states. Also, Oregonians live on the coast, which means that there is a market for power close to shore. When wave power production exceeds the needs of Oregon’s coastal communities, the surplus electricity can be sent inland. Much of the Oregon coast’s electric infrastructure was built to support the timber industry, and due to the decline in the industry, it is currently underutilized. Consequently, power can be sent inland from Oregon’s coast without the need for a costly expansion of transmission capacity.
On top of its kinetic potential, Oregon has the research expertise needed to be a worldwide leader in wave energy production. The National Marine Renewable Energy Center has wave power testing and research facilities at Oregon State University. A wave pool suitable to test buoys is currently in operation, and the only domestic in-ocean facility suitable for testing full-sized buoys is in the planning stages.
Another reason Oregon is positioned to lead the wave energy industry is that the state has a strong track record of support for innovative renewable energy projects. Oregonians started numerous community-based projects to promote renewable energy and many clean tech companies, from start-ups to the North American headquarters of multi-national companies, are based here. Today the state provides incentives for ocean energy through the Oregon Wave Energy Trust.
Ocean energy is a renewable resource because it utilizes the continuous surge of the waves or tides to produce electricity. This continuous surge of waves can provide a consistent source of energy. Consistent energy is a more valuable form of electricity than intermittent electricity, such as energy from wind turbines that only generate power when the wind blows. Oregon’s continuous wave surges can be harnessed by several different technologies.
One, called a point absorber, is a device that consists of a floating structure with components that move relative to each other due to wave action. Over five days in September 2008, Columbia Power Technologies, a Corvallis-based company, tested the pictured point absorber buoy off the coast of Newport. Columbia Power Technologies is currently testing another prototype in the Puget Sound.
The Pacific Northwest Generating Cooperative, recognizing the potential to spur development in the coastal communities it serves, recently signed up to purchase power from a point absorber project off Reedsport, Oregon. This project, the first domestic commercial-scale ocean energy project, will utilize point absorbers designed by Ocean Power Technologies and built by Oregon Iron Works in Clackamas, OR. Ocean Power Technologies is also in the early stages of developing a wave power production facility off the coast of Coos Bay, Oregon.
Other types of ocean energy technologies are being investigated for use in Oregon’s territorial waters. The “oyster” is a system is mounted to the seafloor. As the oyster pivots, water in a tube is pressurized and sent through a turbine located on-shore (see video for a description of this technology).
This technology was developed by Aquamarine Power, a Scottish company whose North American operations are based in Newport, OR. Aquamarine Power is currently investigating the feasibility of installing a system to provide power to the Central Lincoln People’s Utility District and the Tillamook People’s Utility District.
Whether power is generated through oysters, point absorbers, or other technologies, CUB is excited about ocean power because of Oregon’s potential to be a worldwide leader. CUB fully supports the Oregon Wave Energy Trust’s mission to establish the ocean power industry in Oregon. While ocean power’s potential excites us, we’re not currently advocating full-scale deployment of this emerging and expensive technology. Unproven technologies should be deployed in demonstration projects first, and will not be the best choice for Oregon ratepayers until these technologies become cost-competitive with more established forms of renewable energy.
Revised REP Settlement Agreement
Earlier this month, CUB signed the BPA REP Settlement Agreement, a long-term regional settlement agreement on the allocation of federal hydro benefits. But, like the river system that provides those benefits, this settlement continues to have twists and turns as it moves through the region.
In simple terms, the Residential Exchange Program (REP) is the section of Federal Law which provides for sharing of federal hydro benefits between Consumer-Owned Utilities (COUs) and the residential and small-farm customers of Investor-Owned Utilities (IOUs). The region has been fighting over this program since Congress passed it in 1980.
After about one year of negotiation, representatives of COUs, IOUs, State Governments, and CUB came together around a settlement that would define the sharing of benefits through 2028 and CUB signed that Agreement.
What is the current status of the REP Settlement Agreement?
The original agreement required 91 percent of BPA’s COU load to sign the Agreement by April 15th. That deadline passed with 81.5 percent of the COU load signing on. Looking at the entire load of the region, this means that more than 90% of the entire region supported the agreement. In Oregon, the Agreement was all but unanimous - utilities representing more than 99 percent of Oregon’s electricity customers signed the Agreement! It is rare for 99 percent of Oregon to agree on anything, but they do agree that this settlement is good for the region. Therefore, because such a large percentage of the regional customers agreed, and because this settlement represents the possibility of a regional solution to a vexing problem, a coalition of signing COUs, public utility commissions (PUCs), IOUs, and CUB have agreed to amend the Agreement to create a new signing deadline of June 3 for COUs representing 75 percent of the COU load to sign the “Revised REP Settlement Agreement”. BPA staff supports this change. No other terms of the Agreement have been changed.
So can we celebrate? Not yet……….
Since more than 81 percent of COU load signed the original Agreement, this new threshold should be more than obtainable and will still represent a remarkable achievement.
Last week a large coalition of COUs and IOUs asked BPA to support the revised settlement:
“We cannot recall any other circumstance in which the public and private utilities serving more than 90% of the regional load have come together in a common cause. This is one of the reasons we believe so strongly that we are doing the right thing.”
Here is a link to the joint testimony.
And what has BPA said about all this?
BPA staffers have said:
“…it is our view that the Settlement remains viable, and BPA should continue to consider the Settlement . . . . In our understanding, the revisions have no material effect on the Settlement itself. Rather the revisions speak to the viability of the Settlement and allow the consideration of the Settlement by the Administrator to continue, pending fulfillment of the revised conditions precedent. . . . It is still our recommendation to the Administrator that he sign the Settlement.”
Obviously the BPA administrator still has to rule. See the testimony here.
So why is CUB still involved?
CUB is still involved because it is in the interest of Oregon’s residential customers, regardless of the IOU or COU source of their electricity, to have known benefits available to them every year and for there to be less litigation on this issue. In addition, this region faces significant challenges to our hydro electric system, such as the effect of global warming on river flows and the integration of hydro energy and wind energy. Resolving the allocation issue will allow stakeholders to focus on these challenges.
Has CUB signed the Revised REP Settlement Agreement yet?
Yes. Bob Jenks, on behalf of CUB, signed the “Revised REP Settlement Agreement” today! We strongly encourage all the original signers to do likewise and hope that some who did not sign the original Agreement will see their way to signing the “Revised REP Settlement Agreement”. It’s not too late to join us!
Stay tuned for future updates………
The BPA Administrator will issue his final record of decision in July. Please keep your collective fingers crossed!
Don’t Blame the Rain
Here in the Northwest, we often complain that the skies are grey and the rain never stops. In the CUB office it’s no different; we would rather be out biking or playing catch on all those rainy afternoons, too. In an exceptionally rainy year, while we gripe about the rain’s impact on our plans, we also consider the rain’s impact on the region’s rivers and streams.
The Columbia River has the second largest drainage in the United States; only the Missouri-Mississippi River system is larger. At the John Day Dam, the annual average runoff is 165 billion cubic meters, the equivalent of the amount of water in two Olympic-size swimming pools passing through one point on the river every second of every day! Although swimming pools are a good illustration of flow, in reality the amount of water pouring down the river is not constant. Normally, 60% of the natural runoff occurs during May, June, and July. This runoff in the spring and early summer is due to the melting of snowpack in the Cascades and Rockies, in addition to the regular rainfall at that time of year.
Another unique aspect of the Columbia River is its exceptionally wide range of flows, with the highest flows 35 times larger than the lowest. Compare that with the mighty Mississippi, whose high flows are only 5 times larger than its lowest, and you can see that the Columbia River has an significant level of variation in water flow between days, months, and years. Since 2000, the Columbia River’s flows have been lower than average, and 2010 was another low-water year in a low-water decade.
In the Northwest we are fortunate to receive a lot of rain. However, this rain does not flow to the ocean unobstructed. The Northwest has developed a string of dams and reservoirs that capture this flow and use it to create electricity. The federal government uses these dams to produce low cost power, and, as a result, residential electricity customers in Oregon pay some of the lowest electricity rates in the nation. Dams, in addition to providing electricity, also manage flood control, allow for irrigation, and provide recreational lakes. In order to manage sporadic flows, reservoirs collect water in the spring and then gradually release it over the rest of the year. The combined storage in the reservoirs behind dams on the Columbia River system is 67.8 billion cubic meters. Surprisingly, this storage capacity represents only about 30 percent of an average year’s runoff at The Dalles. By comparison, dams on the Missouri River hold two to three times its annual runoff.
Despite its comparatively small storage capacity, the power production and flood control system have a significant impact on the river’s fish populations. Accordingly, dams across the Northwest are managed to protect the region’s iconic salmon in addition to providing power, irrigation, and flood control. In low water years, dams are required to keep their flow at a minimum level that allows fish to continue their run. Last year, in Klamath Falls, this created a problem for farmers who received less than half of the water they expected to use for irrigation. In the face of a drought during a low-flow year, dam operators prioritized the survival of the river’s salmon population over unlimited crop production, and farmers were left with reduced irrigation.
Farther north, the Columbia River also experienced low flow in 2010, but the first two weeks of June 2010 brought a storm system with torrential rains that produced a much higher flow than the system was expecting. The system struggled to handle much more water than it planned for. The system’s reservoirs, which had not been completely drained in expectation of a low flow year, filled up to their maximum levels quickly. The storm also brought strong winds, which resulted in high wind power production at the same time the reservoirs needed to be emptied. This high wind production prevented the dams from producing their maximum power output, and instead the dams’ operators spilled water without creating power to ensure that the reservoirs did not overflow. This spill produced high levels of total dissolved gases in the river, which almost reached Washington State’s legal limit for protecting the river’s salmon. While some salmon advocates question the biological basis of Washington State’s total dissolved gases limit, it is undisputed that both low-water and high-flow conditions can threaten salmon runs if the region’s dams are not managed carefully.
Currently, we are heading into the Spring and Summer with great hydro conditions. Our major hydro storage is at 118% to 120% of normal. This should mean good hydro run-off through July and into August, and the cost of meeting summer peak load should be relatively low. So, the next time you are ready to complain about how the rains are mucking up your weekend plans and how seasonal affective disorder has you down, take some time to be thankful for the rain’s work keeping your electricity bills low and the salmon runs strong.
Hot Topic: Cool Schools
A hot topic in the legislature has been getting some coverage in the media lately: the “Cool Schools” bill, HB 2960 (here’s a copy of the bill in its current form: http://www.leg.state.or.us/11reg/measpdf/hb2900.dir/hb2960.a.pdf), which seeks to help school districts across the state utilize existing funds more effectively and efficiently to make school buildings energy efficient, has gotten print in a recent Daily Journal of Commerce article (http://djcoregon.com/news/2011/04/04/legislators-work-on-150m-plan-for-green-retrofits-in-schools/) and in today’s Willamette Week (http://wweek.com/portland/article-17410-cool_schools_on_ice.html).
In a closely divided legislature, it’s good to see a proposal that attracts bipartisan interest. After all, as CUB has said for years, saving energy isn’t a Republican or Democratic issue: it’s an Oregonian issue. And the Cool Schools bill seeks to hit a lot of common ground, no matter where you are on the political spectrum: reducing energy usage, creating jobs, strengthening Oregon’s role as a clean energy leader, making schools more efficient so that more money can eventually make its way into the classroom rather than being spent on overhead.
From a ratepayer perspective, CUB’s mantra has been “the cheapest kilowatt hour is the one you don’t have to produce in the first place.” It doesn’t matter to us where the energy savings come from, as long as we actually get them. That’s why we helped create the public purpose funding to ensure that a steady level of ratepayer dollars supports energy efficiency activity over a long period of time. As the Willamette Week article points out, a significant portion of those public purpose dollars – 10 percent – is set aside for energy efficiency projects in schools in the service territories of Portland General Electric and Pacific Power.
To be honest, however, we were a bit perplexed at the dismissive tone of the Willamette Week article. The article seemed to suggest that there was nothing new in the Cool Schools proposal since the public purpose dollars have been around for nearly a decade and not all the money available has been spent in that time. To us, those factors underscore the need for the Cool Schools proposal: If just $15 million is left in the fund after nearly a decade, that suggests that schools are indeed using the fund. Oregon is facing hard times these days. If there are resources available to help any institutions operate more effectively, we need to make sure those resources are used and used wisely.
HB 2960 works to combine existing resources, like the public purpose dollars, with other financial resources such as the state’s Small-Scale Energy Loan Program (SELP) and federal Qualified Energy Conservation Bonds (QECBs) to buy down the cost of loan monies. This ensures that the stream of public purpose dollars, which are guaranteed through 2025, can leverage loan money to make fund available immediately and those loans can be repaid through the stream of public purpose money. Even better, the SELP loans and the QECBs can be used in schools districts outside of PGE and Pacific Power territories, ensuring that Cool Schools has a statewide reach.
Cool Schools scores well on another front too: because the Cool Schools building upgrades use funds that would otherwise not be applied to the general education budget – like federal QECBs – the initiative actually adds an additional revenue stream to schools.
To paraphrase a University of Oregon professor quoted in the DJC article, there is no silver bullet. We have to keep figuring out how to save energy where and how we can. If we can effectively save energy in school buildings – even those that aren’t used all day or on a year-round basis – we can use that experience to acquire even more savings in other public and private sector buildings. We need to do it all. But, as we’ve pointed out in the past (, we can’t do it all at once. So we start where we can, where there are opportunities and keep the momentum going from there.
CUB is proud to support the Cool Schools proposal – HB 2960 – and encourages our members and supporters to contact their legislators to urge its passage. To find out your legislator’s contact information, you can go to: http://www.leg.state.or.us/findlegsltr/. Help the Legislature pass good energy policy, protect ratepayers and help our school tax dollars go just a little bit further.
CUB Honors Earth Day
We all know that Earth is the third rock from the sun. And, as space rocks go, it’s not even a particularly large one. Nevertheless, almost all that we know and love exists on this rock and we aren’t leaving it any time soon. So it pays for us to think about the health of our rock as whole, not just the parts of it we have arbitrarily marked with boarders and walls. In particular, Earth’s natural environment, upon which we depend, is worth knowing and understanding. This, in a nutshell, is what Earth Day is all about.
From its humble beginnings as a US-centered teach-in the 70’s, Earth Day has taken root and grown into a global event involving too many countries and celebrations to count. For some years now, Earth Day has been primarily coordinated by the Earth Day Network, though most small events and celebrations are organized independently. This year, the Earth Day Network’s theme is called “A Billion Acts of Green”, a campaign that looks to generate one billion acts of environmental service and advocacy before the Rio+20, a meeting of the United Nations Conference on Sustainable Development taking place in Brazil in 2012.
Many early Earth Day events focused on pollution, trash, and the need for recycling. In recent years the focus has shifted a bit toward global warming and the need for clean energy. But most of the events calling attention to these issues have one thing in common: They ask not only that we consider the natural environment of Earth, but that we take active steps to improve it. That is, knowing and understanding our world is just a starting point for making it a better place to live.
So what is CUB doing in the spirit of Earth Day?
No Water bottles!
Big blue water jugs are quintessential objects in an office environment. They were a big step to making offices more environmentally friendly by providing clean water to employees who were encouraged to use re-usable cups or water bottles. CUB, has taken the office water supply to an even greener step by investing in a water filtration and cooling apparatus that uses water directly from the water pipe, filters it and cools it. This greatly reduces the amount of plastic we use in the CUB office and provides employees with a clean and green water source.
Our new ‘green’ server!
CUB has switched to Canvass Dreams, a local Portland company, to host both the Oregon CUB website and the CUB Connects website. Canvass Dreams powers 100% of their operations through wind power and works off a local and sustainable business model. According to a 2008 study done by McKinsey & Company, CO2 emissions from data centers will exceed those by the airline industry by 2020. As we depend more and more on technology and computing for our personal and professional lives it’s important we all do our part in reducing our carbon footprint. By using a green server for our site, CUB is staying green as we work to keep our members and the greater Oregon community well informed.
Bikes and public transportation!
In Portland it’s not rare to have an office full of green commuters. But, do other offices have a 100% green commuter score? If we do the math then we have 10 out of 10 of our employees, both of our interns and our law clerk either biking or using public transportation everyday to get to work. That’s 13 out of 13 people biking and riding to the office, a perfect A+ on the green commuter test and just one important way that we can all celebrate Earth Day, today and everyday of the year (even when it’s raining, hailing, snowing or just plain cold).
How do you celebrate Earth Day? Let us know in the comments!
Smart Grid Update
Smart Grid technologies have been emerging around the world the past few years, and some new infrastructure has been rolled out by Oregon utilities. While the future isn’t exactly here today, the groundwork is being laid for substantial technological advances in how customers receive their bills and, more importantly, track their energy usage.
PGE completed a system-wide upgrade of its meters last year, meaning that each and every customer is now part of the company’s Advanced Metering Infrastructure (AMI), i.e. there is now a smart meter on every house. The primary benefit so far has been cost savings from remote metering, since meter readers no longer have to manually record data each month. These meters are also more sensitive to low power draws and measure usage with greater precision, allowing the company to calculate bills more accurately. PGE can also more easily detect power outages and respond to them automatically, rather than having to rely on customers to report outages by phone.
Of more interest to customers may be the coming ability to select billing dates. PGE’s new smart meters remotely collect usage data every few minutes, so it is not difficult for the company to calculate a bill for any period. In the next few months, customers will be able to select the due date for their monthly bill, rather than having to work around the date of the meter reader’s visit. Following that, consumers will have access to detailed usage data, both on the bill and accessible through the company’s web portal. This data will allow customers to assess their energy usage on a daily or hourly basis instead of having to rely only on a monthly bill. This is about as futuristic as we’d like things to get for now, as a number of proposals for mandatory time-of-use and marginal cost rates have emerged that could be pretty bad deals for customers. CUB remains committed to keeping rates both low and simple, and either of those rate structures would complicate bills without providing significant benefits for customers.
The Oregon PUC opened a docket last year to investigate standards for Smart Grid technologies. CUB intervened and submitted comments to the Commission, and CUB staff attended several workshops with Commission staff and other parties to work out the details. Unfortunately, not a whole lot came out of the proceeding. The Commission staff had several proposals that we felt were ill-advised, and we weighed in to let the Commissioners know our views. These issues included Staff’s proposal to prohibit utilities from recovering costs on demand response programs and restrictions on the sharing of customer data. We are anticipating feedback from the Commission on this docket soon.
CUB is also now a member of Smart Grid Oregon (SGO), a consortium of energy industry stakeholders and utilities who are seeking to advise the PUC and Legislature on emerging Smart Grid technologies and promote Smart Grid business opportunities. (CUB Board Member Kelly Cowan is also a staff researcher for SGO). CUB staff members have been attending SGO’s policy committee meetings for the past several months and have enjoyed some interesting discussions on smart meters, electric vehicles, and other topics. CUB’s membership in this organization gives us another platform from which we can advocate for ratepayer interests while forging partnerships with businesses and leading policymakers.
CUB Signs the BPA “REP Settlement Agreement”
CUB’s Executive Director, Bob Jenks, recently signed a settlement agreement (the “REP Settlement Agreement”) on behalf of CUB. If agreed to by a sufficient number of parties, this agreement will settle among the parties disputes over the Bonneville Power Administration’s Residential Exchange Program (REP) that have had northwest investor owned utilities (IOUs), public utility commissions (PUCs) and consumer owned public utilities (COUs) tied up in the Federal Courts for decades.
The REP is a section of the NW Power Act, which governs BPA and the Federal Hydroelectric system. It requires (BPA) to allocate a share of its hydro-generated power benefits to residential and small farm customers of IOUs in the northwest. Since the Act passed in 1980, COUs, IOUs and the states of Oregon, Washington and Idaho have fought and litigated over its interpretation and how much federal hydro power should be shared. CUB has been involved in negotiating this REP Settlement Agreement (Agreement) for over a year. CUB is involved because it is in the interest of Oregon’s residential customers to have known benefits available to them every year and for there to be less, if not no, litigation.
Agreement current status.
The Agreement requires that Parties, except for BPA, execute the Agreement on or before April 15, 2011. On March 14, 2011 CUB’s Board of Directors voted to authorize the signing by CUB of the Bonneville Power Administration (BPA) Agreement. On April 4, 2011, Bob Jenks duly executed the Agreement on behalf of CUB. On April 5, 2011 the PUC considered the Agreement and voted to approve the Agreement and to approve PGE and PacifiCorp’s signing of the Agreement. The commission’s order for PGE and the commission’s order for Pacificorp are available to the public. The Agreement has now been signed by all IOUs in the region, by CUB and by the PUCs in Oregon and Idaho. This press release lists all of the IOUs that signed in addition to the commissions and CUB.
CUB believes that the settlement provides for a fair allocation of federal hydro benefits through the year 2028. After 30 years of near continuous litigation over the allocation of hydro benefits, which caused the benefits to rise and fall based on who was winning the litigation, the region will benefit tremendously by a stable settlement that provides long-term stability. The region faces three difficult issues related to its hydro power system: endangered fish, integrating hydro and wind generation and adapting to changes in snowpack and precipitation due to climate change. Settling the exchange program for an extended period of time will allow the region to address these important issues.
Because there are dozens of COUs in the region, some of whom are extremely small, the Agreement does not require all COUs to join in the settlement - it requires that it be signed by COUs which make up at least 91% of the COU load that is placed on the BPA system. The Agreement is, however, supported by the majority of the COUs in the region including Eugene Water and Electric Board (EWEB), the City of McMinneville, Springfield Utility Board (SUB), and Salem Electric. But one local publicly owned utility, Clark Public Utilities, recently voted not to approve the agreement. CUB sincerely hopes that Clark Public Utilities will change its mind both for its own good and the good of the region. At the time of publishing this blog, it is not clear whether a sufficient number of COUs will sign by the April 15, 2011 signature gathering deadline.
The convoluted and tortured history of the REP.
The big problem with the REP - which was meant to spread the benefits of the federal hydro power system to residential and small farm customers of IOUs in addition to customers of COUs - has always been one of how to implement what is set forth in the statute. The NW Power Act allows IOUs to “exchange” higher cost power that will be used to serve residential and small farm customers with BPA lower cost federally generated hydropower. The Act contains a rate test, that essentially is designed to ensure that the cost of the REP and other factors, when considered together, do not raise the COUs’ rates beyond what they would have paid absent the Northwest Power Act. However, this rate test is convoluted and open to a great deal of interpretation by BPA which has led to a great deal of litigation.
The most recent round of litigation concerning this Act began when BPA entered into settlement agreements in 2000 and 2001 with its IOU customers over the REP. Those agreements were challenged and in May 2007, the Ninth Circuit Court of Appeals held that BPA exceeded its authority in some aspects of the agreement. As a result of the remand from the Ninth Circuit Court of Appeals, BPA decided to require IOUs (and their residential and small farm customers) to repay BPA for some of the benefits that had already been passed through to customers. This repayment request created a new round of litigation since the IOUs were passing through benefits to their customers in accordance with a contract.
One year plus of mediation.
As part of the lawsuits in the 9th Circuit Court of Appeals, parties to the suits, including CUB agreed to attempt to mediate the case. One year plus of mediation and negotiation has ensued since the parties decided to talk. CUB’s goals throughout have been to ensure that residential and small-farm customers are allocated a reasonable share of the economic benefits associated with the federal hydroelectric system on a long-term basis without imposing unfair costs onto customers of consumer-owned utilities. Entering into the mediation, CUB was skeptical that the parties could reach agreement. 30 years of history suggested that a broadly supported deal was unlikely. However, much to our surprise, the parties were able to reach an agreement that truly represents a reasonable compromise of all parties’ positions.
Benefits for residential and small farm customers; less litigation; and better relationships with COUs.
The REP Settlement Agreement achieves the following primary benefits for the Companies and their customers:
1. A fixed stream of residential exchange program (“REP”) benefits to IOUs for allocation from October 1, 2011 through September 30, 2028 (“REP Settlement Benefits”) that grow over time so customers in 2025 will still get a reasonable share of benefits; Settlement of pending litigation among the Parties;
2. The potential for fewer disputes and reduced resource demands needed to administer the REP; and
3. Fostering of positive relationships with BPA, settling customer-owned utilities (“Settling COUS”), and other stakeholders and interested parties which will make it easier for the region to address the challenges we face
The risks that will remain even after the Agreement is implemented.
Although the Agreement is a significant achievement for the region, its utilities and their customers, it is not without risk. The primary risks of the Agreement are as follows:
1. Litigation with a small number of parties who refuse to settle may proceed and could alter REP benefits received under the Agreement;
2. Given the long-term nature of the Agreements, REP Settlement Benefits could be less than the REP benefits Oregon residential customers of PGE and Pacific Power would have received absent the Agreement. This is clearly the biggest risk among all sides to this settlement. Because BPA has such broad authority to determine the allocation of benefits, it is difficult to say whether this settlement has greater or lower benefits than would be received absent a settlement. But given nearly a 30 year history of benefits, this deal provides a reasonable share of benefits to residential customers who live in Oregon.
While the Agreement has some degree of risk and uncertainty, the long-term benefits of the Agreement outweigh those risks.
What would the implementation of the Agreement mean to Customers in the short term?
PGE: It is currently expected that for PGE customers near term customer impacts will result in a limited increase in REP benefits for 2012, as compared to 2011, from approximately $49 million to approximately $58 million. The Agreements result in long-term benefits for PGE’s customers by resolving pending litigation claims among the Parties (including repayment of past benefits) and establishing a fixed, long-term stream of REP benefits to PGE’s customers.
PACIFICORP: Near-term customer impacts are projected to result in an $ 8 million reduction in REP benefits for 2012, as compared to 2011, for PacifiCorp’s residential and small farm customers. However, the Agreement results in long-term benefits for PacifiCorp’s customers by resolving pending litigation claims among the Parties and establishing a fixed, long-term stream of REP benefits to PacifiCorp’s customers.
What if the Agreement fails to become effective?
Unless COUs equal to or greater than 91% of COU load on the federal system execute and deliver the signed Agreement to BPA by April 15, 2011, the agreement is void. If, however, 91% of the COUs sign then it will be up to BPA whether or not the Agreement becomes effective - for the Agreement to become effective BPA must also sign. BPA is expected to issue a final Record of Decision in which it will decide whether or not to sign the Agreement by July 5, 2011.
Ratification
The Agreement provides that the parties will work together to urge the U.S. Congress to pass legislation to affirm the Agreement and direct BPA to perform the Agreement according to its terms. This will allow the region to implement the agreement and move further away from the litigation path.
Thank you for the work to get us here.
At CUB we are often required to criticize the local investor owned utilities for their lack of foresight or some other misstep. Today, we need to do something different. Today, we need to thank the employees of PGE and PacifiCorp, who have worked jointly with CUB, Commission Staff, Avista and Idaho Power Company (who did not need OPUC approval to sign) to bring the REP Settlement Agreement to potential fruition for the benefit of Oregon IOU ratepayers. Our thanks go out especially to Jim Lobdell and Stefan Brown at PGE, to Pat Egan and Phil Obenchain at PacifiCorp, Ric Gale and Celeste Schwendiman at Idaho Power, Tom DeBoer at Puget Sound Energy and to Larry Labolle at Avista. And last, but not least, to Marc Hellman (OPUC Staff).
We would also like to take a moment to thank the folks who negotiated on behalf of the consumer owned utilities. Particular thanks go to Scott Corwin - PPC; John Prescott - PNGC; John Saven - NRU; and of course to countless others.
Electric Vehicle Update
Electric Vehicles in the News, and on the Road
Electric vehicles have been all over the news lately, and with good cause. The commercial rollout of the first next-generation electric vehicles (EVs, for short) has happened with a good amount of fanfare over the past couple of months in both local and national media. The American Recovery and Reinvestment Act (ARRA), aka the Stimulus Package, has provided funding to Ecotality, Inc. to build EV charging infrastructure in Oregon, which will help prepare our state’s highway network to accommodate longer-range trips in the new vehicles. Nissan Motors has chosen Oregon as one of the first markets to release its new LEAF (Low-Emission, Alternative Fuel) sedan, and the Chevrolet Volt is now available to customers in other parts of the country. All of these developments are exciting for people interested in cars, energy efficiency, environmental activism, and more.
One interesting new piece of media attention coming out in the near future is the film The Revenge of the Electric Car. Directed by Chris Paine, who also wrote and directed the 2006 film Who Killed the Electric Car?, the film looks to be an amusing take on emerging vehicle technologies and the major players in the electric car industry, as well as some adventurous folks who have converted their own vehicles to run on electricity. Look for screenings in Portland and across the
country late this spring or early this summer.
CUB Gets Behind the Wheel
CUB staff members Gordon Feighner and Jeff Bissonnette recently had the opportunity to test drive a plug-in hybrid Toyota Prius owned by PGE. While not a full EV (the car does have a gasoline engine in addition to a battery), the car did give a good feel for the experience of driving an electric vehicle. Gordon got up to over 50 mph on the highway before the gas engine kicked in, and in-town driving was done in full electric mode. The overall driving experience was not noticeably different than any other modern gasoline-powered sedan, except that the single-speed transmission provides for a slightly smoother ride.
PGE also took the opportunity to show off the charging stations it is trying out for its fleet of electric vehicles. One of these is a Level III quick-charge station which charges at up to 400 volts, providing up to 80% of the vehicle’s battery power in under 20 minutes. The company is also testing several Level II charging stations. These operate at 240 volts, taking four to eight hours to fully charge a vehicle. The Level III stations will typically be available to the public at highway rest areas, truck stops, and major retailers, while the Level II stations will more likely be used for home installations.
Rates and Regulations
On the regulatory side of things, the Oregon PUC has been conducting workshops with stakeholders to determine how to treat electric rates for EV charging. One proposal that has had a few proponents requires EV owners to sign up for a time-of-use rate structure that would provide an incentive to charge vehicles during off-peak hours (say, between 10pm and 6am). CUB does see the value in such a plan, but objects to any sort of mandatory program, as it would require costly additional meters to be installed at the homes of EV owners. Rather, the program should be made optional for the time being, with an eye towards providing more consumer choice for rate structures in the future.
The new EVs are the first real smart “appliances” to hit the market, and as such, they have technology onboard that can meter electric usage and communicate directly with the utility via the Internet. This capability obviates the need for a separate meter just for EV charging, and could allow EV owners to set their vehicles to charge only at certain times when rates are lowest, and could also provide utilities with the flexibility to manage the vehicle charging load by staggering the charging of the vehicles connected to the grid overnight. Technology also exists to send signals that encourage charging during periods of high wind generation. EV charging could, therefore, be dispatched at times during which the marginal emissions (and costs) are near zero, resulting in a greatly diminished impact of EVs on both the grid and the atmosphere. Of course, EV owners who prefer to rely on manual settings should also still be allowed to do so and remain on the regular residential rate schedule.
CUB will continue to be actively involved with the various aspects of electric vehicle implementation in the state, and we’ll keep you updated on its progress.
Finally, If you’ve been a renter and your utility costs were part of your rent? Did your landlord ever fall behind in utility payments where your utilities could have gotten shut off? Do you know someone who’s had that experience? If so, please contact CUB Organizing Director Jeff Bissonnette.
CUB Supports Utility Tax Law Reform
“Phantom taxes”, built into utility rates, are controversial. The problem arises because some utilities are not “stand-alone companies” and file taxes as part of the larger affiliated group. Rather than pay taxes to the government, these utilities pay “taxes” to their parent companies, which, after working internal company magic, have in some cases been able to retain the “tax payment” as an increase to earnings instead of paying it to the government. Thus the taxes, which are built into utility rates, can become “Phantom taxes” existing only on paper and not paid in reality. This phenomenon was previously discussed in relation to Enron and in relation to ScottishPower. We will refer to these as the Enron Problem and the Scottish Power Problem:
The Enron Problem:
Enron used to own Portland General Electric. Enron took an entrepreneurial approach to taxes, and attempted to avoid paying them. This meant that customers paid hundreds of millions of dollars in “taxes” to PGE, which parent company Enron then eliminated by washing through the larger company and paying little or no taxes to both the state and federal government. Enron then pocketed the taxes as additional profits.
The ScottishPower Problem:
ScottishPower used to own PacifiCorp. ScottishPower created a holding company, PacifiCorp Holding Inc. (PHI), to be the immediate corporate parent to PacifiCorp. ScottishPower loaned PHI much of the money it used to purchase PacifiCorp. PHI then incurred $160 million annually in interest payments for this debt. That $160 million interest payment was tax deductible. This meant that the tax payment PacifiCorp collected from its customers, to pay state and federal taxes, largely disappeared when applied as an offset against the parent company’s tax deductible interest payment. PacifiCorp’s customers paid the taxes but the state and federal governments did not receive the money. (see blog: July 11, 2006 PUC Upholds Rate Reduction in PacifiCorp Reconsideration).
SB 408
While CUB believed the PUC had authority to address the issue of phantom taxation without legislation, the Staff of the PUC opposed all proposals to adjust the taxes that customers pay in order to address this problem. Legislation seemed the only route to fix the problem and several legislative fixes were proposed.
The legislative fight in 2005 was difficult. All of the Oregon utilities fought the legislation. CUB, with other customer organizations, led the fight to pass SB 408. Ultimately, we prevailed and SB 408 passed. Under that legislation, for any given year, the PUC is required to true up the difference between taxes paid by customers and taxes the utility (or its parent company) pays to the government. If there is an imbalance and customers paid too much, then there is a refund. If customers paid too little, then there is a surcharge.
While the true-up process sounds easy, compare the taxes that are in rates to the taxes that end up with the Government, implementing the law has proven difficult.
Taxes in Rates.
When utility rates are set, we forecast the cost of providing utility service and the volume of demand that customers will place on the system for a particular year (called a test year). These forecasts always turn out to be wrong either because of weather, changing economic conditions which affect the demand for electricity and natural gas, or other unanticipated events. There are countless variables that are forecast, and all we can be sure of is that our forecast will be wrong. When we look back on a year of actual operations, SB 408 first requires us to determine the amount of taxes in rates. But since the actual year we are looking at may be 2 or 3 years after a utility test year, and has different costs, different demand, and even a somewhat different set of customers, we had to come up with a methodology to decide what was the level of taxes in rates. In the end we decided to convert the rate case figure to a ratio, so the amount that customers pay in taxes varies with the amount of revenues received by the utility.
Accelerated Depreciation.
One of the more difficult issues to deal with is accelerated depreciation. Under federal tax rules, businesses are able to take advantage of accelerated depreciation. As part of efforts to stimulate the economy during the current recession, businesses have been given the opportunity to achieve bonus depreciation, allowing them to depreciate a new investment in one or two years. However, under IRS rules, utilities cannot pass through the benefits of accelerated depreciation to customers. This creates a timing difference, where a utility can depreciate an asset for tax purposes in one or two years, but for ratemaking purposes the depreciation happens over the life of the asset. For SB 408 purposes this means that in order to determine the amount of tax that the utility should have paid we have to take the amount of taxes paid by the utility and adjust that number to remove the benefits of accelerated depreciation and to convert the number to traditional depreciation schedules.
Consolidated Tax Filing.
When a utility is part of a large parent owned conglomerate that does a consolidated tax filing that can include dozens or even hundreds of affiliates, what methodology should be used to determine the share of the consolidated tax filing that represents the share the utility should pay in Oregon and to the federal government? This is a difficult issue. There is no single right answer.
The problem as set forth above is similar to asking, ”What is Oregon’s share of the federal budget?” Do you divide the federal budget by the number of citizens of each state, or by income, since income taxes are how most federal revenue is generated? Or do you try to identify the cost of all the services provided with federal dollars on Oregon’s behalf? Or do you try to identify all the revenue that comes from Oregon residents and businesses? For utility taxes, the PUC chose to use a method that begins with the total taxes of the consolidated company and attributes them to each corporate affiliate based on three factors (sales, property and payroll). This is similar to how large consolidated companies allocate other corporate overhead costs such as accounting, insurance, management and Board of Directors costs.
Double Whammy.
Finally, we had the problem of what has been called “the double whammy.” When a utility has higher costs than we forecast, lower revenues than we forecast or a combination of the two, it is going to have lower profits than forecast. Lower profits also means lower taxes. Under the true up provision of SB 408, a utility that has a bad year and earns less than its rate of return has to refund tax payments to its customers, thus making its already bad year worse. But, when a utility has lower costs than forecast, greater revenues or a combination of both, it also has higher profits than forecast and should pay higher taxes than forecast. Under SB 408, this utility gets to surcharge its customers for its higher taxes, making its good year even better.
After SB 408 passed, it took a year to put in place rules to deal with these difficult issues. CUB ultimately believed that the resolution of these issues reached by the PUC was reasonable. CUB further believed that the resolution would lead to a reduction in the overpayment of taxes by customers. In July 2006, CUB blogged on the topic CUB Praises PUC Tax Reform Ruling:
The Public Utility Commission today released its Interim Order regarding implementation of the new utility tax law, SB 408. CUB Executive Director Bob Jenks had this to say about the ruling: “The PUC found a simple and elegant compromise to solve a serious problem in ratemaking. We expect that customers will see lower rates as a result”.
The Actual History of Tax True Ups.
We have now had several years of tax true ups and it is time to look back and evaluate whether the bill has had the desired effect of reducing customer tax overpayments.
However, like everything else about SB 408, it is not clear whether the bill had the desired effect and actually lowered customer payments. If we look simply at the sum total of refunds and surcharges, the results for customers were actually negative – customers have continued to pay more than CUB thinks they should. That is, customers have paid about $21 million more in surcharges than they have received in refunds. There is, however, a mitigating factor that can be added to the mix and that is that right after SB 408 passed, CUB, who had been in the middle of challenging the “ScottishPower Problem” in a ratecase, obtained a ruling from the PUC - which cited SB 408 as the reason for the adjustment it was offering - and adjusted PacifiCorp’s rates down by $26 million. If you factor this into the SB 408 equation, and count this as a result for customers, then customers do come out ahead by about $5 million. We note that even though PacifiCorp asked the Commission to reconsider that order, on the grounds that SB 408 while passed was not yet in effect, the PUC responded by keeping the adjustment and saying that they would have implemented the adjustment with or without SB 408 based simply on the evidence that CUB had presented. So, whether SB 408 reduced rates, or increased rates, all depends on whether you attribute that $26 million rate reduction to SB 408 or not.
One other thing you find when you evaluate SB 408 is that the results of SB 408 really vary by utility. On the gas side, customers of NW Natural are being hit with a surcharge every year, while customers of Avista are receiving refunds every year. In both cases, the surcharges and refunds are the results of the double-whammy and not the result of consolidated companies or affiliates.
On the electric side, Enron and ScottishPower are gone, replaced by an independent PGE and the enormous Berkshire Hathaway owned PacifiCorp. PGE customers have benefited from SB 408 refunds. PGE has had a series of higher costs caused by problems at its Boardman plant, the requirement to refund to customer dollars associated with the Trojan nuclear power plant, and broken equipment at its Pelton/Round Butte hydro facility. These issues have led to the company having lower earnings than forecast, and thus to them also having lower taxes. Under SB 408, PGE customers have received refunds. PacifiCorp, on the other hand, hit its customers mostly with surcharges.
Affect on Mergers
A wonderful side effect of SB 408 has been the elimination of a tool that holding companies have used to purchase utilities. By prohibiting a holding company from using debt at its parent level to purchase a utility and hide a tax deduction from the utility’s customers, SB 408 takes away an important means by which utility purchases are financed. Because that tax deduction will be passed through to customers, purchasing an Oregon utility is not as lucrative as purchasing utilities in other states. None of the four utilities that are affected by SB 408 have changed hands since the law passed, even though there have been a large number of utility mergers around the country. (The change in ownership of PGE and PacifiCorp happened before SB 408 was law) CUB believes this is a huge and powerful – pun intended – benefit to SB 408.
A Tale of Two Utilities: NW Natural and PGE
NW Natural and PGE offer a good contrast. After Enron left town PGE became an independently owned utility. Now both NWN and PGE are independent utilities with the bulk of their operations dedicated to providing utility service in Oregon. Both have experienced the double whammy, but both have been nearly exclusively on one side of the double whammy – PGE paying refunds and NW Natural charging surcharges. While NW Natural has earned more than its allowed rate of return – CUB thinks it is over-earning – and has had to pay additional taxes as a result, it has, nevertheless been able to bill those excess taxes to customers, thus creating additional earnings for its shareholders. PGE, on the other hand, has earned less than its allowed rate of return, has paid less in taxes, and has still had to refund money to customers, further reducing its earnings. Five years ago, when we were developing the rules for SB 408, NW Natural’s stock price was $33.4/share. Today, its stock price has increased by about 33% to $47.39. Five years ago, PGE’s stock price was $28.5/share. Today it has declined 18% to $23.5/share.
Finally, we note that in order to deal with its under-earning, PGE has filed three rate cases during this period of time to increase its rates. NW Natural, on the other hand, has been able to avoid a rate case that could cut its rates. One poor consequence of SB 408 is that it actually has made it harder to reduce the rates of a utility like NW Natural that is over-earning. NW Natural’s customers pay too much. If a utility is chronically over-earning, it is a sign that rates are too high. Initiating a rate case to reduce rates is a tremendous amount of work. It requires the PUC staff to go in and audit the books of the company in order to prove that rates should be reduced. Because of the burden SB 408 puts on the PUC staff – from October through March, SB 408 true up proceedings for each of the energy utilities, dominates the workload – SB 408 is actually is making it harder for the PUC to do the necessary work to gain rate relief for NW Natural customers. So instead of a rate reduction, NW Natural customers continue to see annual surcharges. Sadly, it seems that justice is not to be had even with the advent of SB 408. Something has to be done.
Reforming SB 408
This brings us to the need to reform SB 408. Can we remove the burden of the annual true-up proceedings, while at the same time stopping the Enron and ScottishPower problems and preventing a new set of utility mergers? Repealing SB 408 and returning to the days when the PUC allowed utilities to charge customers hundreds of millions of dollars for taxes, regardless of whether the utility’s parent company actually paid taxes, is unacceptable. For all its flaws, SB 408 is preferable to what came before it. But from our experience with SB 408, we know we need a different fix. CUB, having learned from SB 408 thinks we now have the knowledge to design a new and improved system that is fair to customers while being simpler and eliminating surcharges associated with over-earning utilities. CUB believes this can be done if we require the following:
We get rid of the SB 408 requirement of an annual true up. Outside of SB 408, other utility costs are also subject to true-ups but not necessarily on an annual basis. If the SB 408 annual true up is repealed, we will still be able to true up taxes. But we can do it on a case-by-case basis, not as a legal requirement. This will reduce the burden of SB 408 and still allow us to true up taxes if another Enron shows up.
We provide clear direction in the law that the PUC must look at the corporate structure, and consider the actual tax payments that are made to government when determining customer rates. We believe the Commission could have done this before SB 408, and we advocated that in the ScottishPower/PacifiCorp rate case discussed above. However, because the PUC staff historically opposed such adjustment to utility taxes, any reform of SB 408 must contain mandatory language requiring the PUC to protect customers from overpaying utility taxes.
Explicit direction for the PUC to consider true ups and holding company equity when a utility merger is being considered. We want to send a message to holding companies that Oregon is not going to encourage you to purchase our utilities by giving you tax breaks to do so.
SB 967 is a bill that would accomplish all of these important items. It will create a regulatory structure that does not allow Enrons and ScottishPowers to turn tax payments made by customers into profits for themselves, while at the same time ending the practice of over-earning utilities placing additional costs onto customers.
CUB Intern Update
CUB has been fortunate to have a number of great interns over the years. This is due not only to fortune, but also to an endowment, which helps fund one of our internships. The Eric Shaich Memorial Internship Fund was created in 1993 with the objective of providing students with the opportunity to gain skills and experience, while furthering CUB’s mission of ensuring fair utility rates, maintaining a sustainable energy supply, and promoting telecommunications policies which promote civic values.
CUB currently has two Shaich Interns, Tania Porter and John Sturm:
Tania: I moved back to Portland in early 2010 after spending six years working and going to school at Oregon State in Corvallis. In June, I received my BS in American Studies and minor in Resource Economics, focusing on environmental science and ethnic studies. I am now half-way through my Masters of Public Administration program at Portland State, where I am focusing on natural resource and energy policy, specifically in the areas of ecosystem services and energy security in indigenous communities. I currently live in a 1918 St. Johns bungalow with my daughters, Gabby and Bridgette, our ward Laura, a hamster called Wesley, and our newest addition, a kitten named Chai. I enjoy working in my garden, where I am fairly successful with flowers and completely unsuccessful with artichokes.
The legislative internship at CUB was a natural extension of my earlier academic work and a nice follow-up to an internship with the Community Energy Project in NE Portland. Working at CUB has been a great firsthand lesson in how quickly citizens can mobilize to fight unjust legislation. So far in the 2011 session we have been able to initiate a lot of response on specific measures by reaching out to our Energy Trust of Oregon (ETO) allies throughout the state. John and I have spent the last couple of months creating a database which enables us to easily gather information about the economic and environmental impacts of the ETO’s work with ratepayers around the state. We look forward to working with CUB’s members, which will help CUB remain an effective voice for all of Oregon’s ratepayers.
John: I applied to work with CUB as a third year law student, studying environmental law at Lewis and Clark. CUB offered the prospect of getting to do public interest work in the energy sector, something of great interest to me. CUB really stands at the center of so much that happens in this area in terms of law, policy and regulation. They are frequently involved in over 30 open dockets before the Public Utilities Commission, and advocating on behalf of residential ratepayers in many other contexts as well. Working with CUB is really a tremendous opportunity in this respect. There’s a never-ending stream of interesting issues to tackle and people to meet. As someone aspiring to have a career in this sector, I can’t think of a better place to begin.
Tania and John have been working to promote CUB policies and interests in the context of the 2011 legislative session. As we noted in our March 1 legislative update, CUB’s legislative team spends considerable time tracking proposed legislation in Oregon to promote those laws which protect ratepayer interests and to advocate against those which threaten such interests, and this year is no different.
In particular, CUB has paid special attention to HB 3535, a bill that will establish a “mile-per-gallon” rating for homes and businesses so that buyers and renters will know how much energy costs will be. With this kind of information front and center, there will be an incentive to make more energy efficiency investments. (By the way, have you contacted members of the House Energy, Environment and Water Committee to support the bill? See our legislative alert here. CUB is tracking close to 100 bills focused on energy and utility issues, always looking to watch out for the interests (and wallets) of residential ratepayers. The behind the scenes work and support of our Shaich interns is critical in our efforts.
Thank you Tania and John!
Consumer Advocacy at the National Level
Last week CUB staff member Andrea Crosby traveled to our nation’s capital for the 2011 Consumer Assembly of the Consumer Federation of America (CFA). The agenda included presentations and roundtables covering the complete spectrum of consumer advocacy issues and debates. The annual conference aims to inform CFA members of current issues while receiving feedback, ideas, and suggestions on how to form and advance federal policy recommendations. The conference opened with an introduction by the Honorable Henry Waxman, the California representative known for his support of consumer rights and privacy, and his actions in Congress to support the public interest. His opening remarks regarding the current national policy environment were informative and realistic. He thanked all of the consumer groups for our efforts, and urged the audience to continue to work for the public interest.
Among the wide range of topics, a handful relate to CUB’s efforts here in Oregon. National decisions and policies regarding vehicle fuel economy, energy efficiency standards, communications, and more can impact the work we do at CUB. For example, the CFA is currently developing a policy resolution that proposes an increase of the average fuel standard for motor vehicles to 60 miles per gallon by 2025. The CFA is requesting comments from state consumer advocate agencies and organizations to present to the US Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA). Changes in the national policies can help CUB advocate at the state level and influence the state’s debates.
A hot topic at the conference was internet access, and the various consumer protection debates that arise from the advancement of technology and the complexity of the products available. The internet remains a grey area for federal regulators, but consumer advocate groups are constantly fighting to protect consumer privacy and rights. Ellen Bloom, the Director of Federal Policy for the Consumers Union, mentioned a number of issues, but focused on the need to oppose repeals that will destroy the advances that the Federal Communications Commission (FCC) has made with the Bill Shock Rule and Net Neutrality ruling. The Bill Shock Rule requires mobile service providers to send alerts to consumers when they are about to exceed their allocated amount of voice, texting, and data in order to help customers avoid unmanageable increases to their bills when these allocations are exceeded. The Net Neutrality Ruling aims to keep the internet open to all users and prevents internet providers from favoring or discriminating against traffic that goes over their networks. Opposing repeal motions from the 112th US Congress to both of these rulings are critical for the consumer movement.
CUB remains a proud member of the Consumer Federation of America to stay informed about these issues and more. We’ll update you going forward on topics of importance to Oregon consumers, and we look forward to attending the Consumer Assembly next year.
PIELC 2011
CUB staff members John Sturm and SA Anders had the pleasure of attending this year’s Public Interest Environmental Law Conference (PIELC) at the University of Oregon Law School in Eugene. PIELC is an annual conference that brings together a diverse group of people from the environmental and public interest communities, as well as various energy sector and policy figures from the region and abroad. The theme of this year’s conference was “Turning the Tides: Creating a Green and Clean Future” and the conference featured a number of sessions dedicated to energy and the environment—two things CUB cares deeply about. While there were far too many panels and sessions for us to attend them all, here’s a sampling of some of the many issues at play over the course of the four-day event.
Coal was a subject of multiple panel sessions throughout the weekend. Environmental groups, such as the Sierra Club, have been campaigning against America’s continued reliance on this fossil fuel. Many of these efforts have focused on litigation and public outreach, with less emphasis on the economics of coal in the context of the decisions made in state Public Utility Commissions. In the case of the decision to close the PGE plant in Boardman, OR, this latter approach was instrumental both in showing the costs of regulatory compliance associated with coal, but also in ensuring that the costs of transitioning away from coal are not unfairly shouldered by ratepayers. This has long been CUB’s approach, and we were pleased to see that it received attention in some of the PIELC panels.
This perspective had particular relevance when Sierra Club’s Bruce Nilles publicly revealed a plan to start closure of Washington’s only coal plant. This plan would close the first of two units at TransAlta’s 1460 MW plant in Centralia in 2020, with the second unit closing in 2025. As a state which has recently gone through a closure process, we hope that the deal treats Washington ratepayers fairly.
Another topic that received considerable discussion at the PIELC conference was natural gas—in particular, the environmental concerns associated with its extraction. Natural gas extraction is frequently made more efficient by breaking up, or fracturing, the rock and earth surrounding the wellbore. The process generally involves pumping large amounts of an often toxic brew of chemical-laden water and sand in to the earth. Much of this water is then brought back up to the surface, and what can’t be reused must be disposed of. There are different disposal techniques, but each comes with risks and problems for human health and the environment. In addition to the concerns about hydraulic fracturing, there are considerable emissions from the diesel generators and trucks used to drill the wells. The cost of addressing these problems is not one that the natural gas industry has fully been able to internalize. None of this is new, but, owing to a number of recent high-profile exposés on the harms caused by hydraulic fracturing, the regulatory climate may be shifting.
This is of particular concern given the recent move by Northwest Natural to get into the gas production business. NWN recently announced, in docket UM 1520, its intention to buy $250 million worth of gas from Encana in a “drill-to-earn” partnership. This agreement would have NWN actually finance the drilling of individual gas wells—something utilities rarely do—as a part of its long-term investment portfolio. The wells in question would be located in the Jonah field in Sublette County, Wyoming, an area featured in many environmental exposés for its poor local air quality that results from the drilling activity. CUB is currently involved in this docket with the hope of determining whether or not NWN has properly accounted for the potential costs of dealing with these environmental concerns.
At least one PIELC panel addressed the topic of nuclear power in the US as a response to climate change. While there have been remarkable advances in the science of nuclear power, which have provided new plant designs that are dramatically safer than previous and existing plants, it remains the case that nuclear power is expensive, and there is no broadly accepted means of dealing with the waste produced. Moreover, given the recent and ongoing tragedy in Japan, what little support nuclear proponents may have had in Oregon is likely to further erode.
CUB notes that that there are currently at least two bills before state legislators dealing with nuclear energy. HB 2587 would repeal the Oregon law that prevents new nuclear facilities from being built in the state until adequate waste disposal facilities are federally licensed. HB 2603 broadly declares state support for all types of power, specifically including nuclear power. CUB does not support either bill and does not expect to see either bill pass.
The panel of greatest interest to CUB had the provocative title: “Utility Rates and Rate Structures; Do they Support or Undermine Energy Conservation?” Conservation, and energy efficiency in general, have been hot topics in the Northwest for some time now. Of note, the Northwest Power and Conservation Council, in its latest Power Plan, found that efforts in these areas could be used to meet 85% of the region’s load growth over the next 20 years.
Organized by Craig Patterson, this panel included our own executive director, Bob Jenks. Conversation centered on the degree to which pricing signals moderate consumer behavior and energy conservation in general. Though there was some debate, the consensus seemed to be that price signals are not particularly effective at promoting energy conservation on their own, and that better mechanisms are available, such as inclining block rates combined with energy efficiency programs.
CUB staff will continue to attend state and regional conferences of interest—in April, staff members will be attending the Future Energy Conference here in Portland. We’ll keep you informed of the hot topics and new information as it is revealed.
Visit us on the web at OregonCUB.org and consider becoming a CUB member today!
CUB Legislative Update and a New CUB Addition
Alert readers know that CUB advocates on behalf of residential ratepayers in dockets before the Public Utility Commission, but our work doesn’t stop there. CUB’s legislative team spends considerable time tracking proposed legislation in Oregon to promote those laws which protect ratepayer interests and to advocate against those which threaten such interests.
The 76th Legislative Assembly is in full swing and CUB has its work cut out for it. During a three-day organizational session in January, the Legislature introduced more than 1600 bills –and many more have been introduced in the following weeks. In fact, it’s not uncommon for the Oregon House and Senate to introduce a few thousand bills and resolutions in all. Tracking which of those bills might impact the interest of residential utility customers requires time and organization.
In this session, CUB is tracking about 75 pieces of legislation, covering a wide variety of issues. For example, there are a number of bills relating to energy efficiency in schools; several bills that would affect the development of ocean wave energy in Oregon; at least two proposals promoting nuclear energy in Oregon; and one bill that even calls for abolishing the Department of Energy. Additionally, there are several bills which would alter current funding for programs which CUB has supported, including funding for the Business Energy Tax Credit program and the Energy Trust.
CUB will be keeping a close eye on these and many other bills throughout the year. And, as CUB Organizing Director Jeff Bissonnette can tell you, that’s no small task –especially when you have a newborn son to look after. That’s right; CUB extends a warm welcome to the newest member of the family and heartfelt congratulations to Jeff and his wife Melanie, who gave birth to their son on February 19!
CUB’s Legislative Action Team is also improving efforts to reach out to Oregon rate-payers and businesses potentially affected by proposed legislation. Our expanded direct-action program recognizes that CUB’s voice is stronger when partnered with those of Oregon’s citizens most affected by rate shifts. Look for more information from CUB in the coming months detailing opportunities to lend your voice to CUB. We have a lot of work to do this session and your continued support is appreciated!
Warm Tariff Explanation for NW Natural Customers
A CUB member recently called with some questions about her NW Natural bill. As usual, her questions sparked some interest among the CUB staff and we took to investigating her inquiries. The CUB member was specifically asking about two adjustments on her monthly bill - the Billing Factor and the WARM Tariff. CUB Utility Analyst Gordon Feighner researched these two fees, which impact the majority of NW Natural customers, and explains them here, in plain English.
Both of these adjustments are somewhat complicated calculations that don’t have very thorough explanations anywhere on the average customer’s bill. With these types of adjustments and all of the other taxes and fees that comprise a utility bill, it’s no wonder that most customers only look at the bottom line and the due date, and then write a check. Several weeks ago Gordon sat down with Gary Dye, NW Natural’s Field Supervisor for Gas Measurement, to get a handle on the Billing Factor. This is referred to on the bill, unsurprisingly, as “Billing Factor”. It is a number in the form of 1.XXX that is multiplied by the units of gas a customer uses each month to calculate the total therms (units) that are eligible for billing. You can find this about four or five lines down in the “Usage Summary” section of the bill. The Billing Factor consists of four sub-factors: temperature, pressure, BTU (British Thermal Unit –a measure of heat) factor, and meter multiplier. For most residential customers, the meter multiplier and temperature factors are irrelevant, as there is only one meter on a home and the majority of NW Natural’s meters auto-correct for temperature. This leaves pressure and the BTU factor to make up the bulk of the Billing Factor.
Pressure is largely a function of altitude. NW Natural has mapped out its service territory into ½ square mile “plats” and calculated the average altitude in each plat. Put simply, atmospheric pressure decreases as altitude increases. Gas becomes less dense at lower pressure, so the higher a property is, the larger the pressure factor will be to compensate for lower gas density. Barometric pressure is also considered in the pressure factor, and is based on the National Weather Service’s records at Portland International Airport. The combined pressure factor of barometric pressure and altitude is usually between 0.95 and 1.03 in NW Natural’s service territory.
The BTU factor is based on the heat content of the gas that is flowing through NW Natural’s system at a given time. Natural gas, being a natural resource, is not uniformly consistent. The composition of the mixture of gases in the system – methane, propane, butane, and ethane – can change slightly from day to day and month to month, affecting the heating value of the gas that eventually arrives at homes and businesses. The BTU factor is usually between 1.01 and 1.04 for NW Natural customers.
Taken as a whole, the Billing Factor for most customers is in the range of 2-3% each month. Extreme cases (usually in areas that are at high altitudes) may have a billing factor as large as 6-7%. For all customers, though, this adjustment is meant to improve the accuracy of gas meters by accounting for external factors.
The WARM (Weather Adjusted Rate Mechanism) tariff is the default for NW Natural’s residential customers, meaning that customers who are not interested in participating must opt out of the program. WARM provides an adjustment to bills from December 1 through May 15 to help smooth variations in bills that result from weather being colder or warmer than normal. This means that when temperatures are colder than expected, bills will be a bit lower, but when temperatures are warmer than expected, bills will be a bit higher. This adjustment is limited to $12 per month, or 25% of a customer’s monthly bill, whichever is less.
The extent to which WARM alters a bill in a given month is based on the total difference between the expected and actual temperatures in a billing cycle. This difference is measured in Heating Degree Days (HDD), which is a complicated calculation that is laid out in the official tariff notice located here.
So there you have it, an explanation of two seemingly mysterious factors that affect your monthly gas bill. CUB has supported the WARM tariff since its inception in 2003, and approved of its renewal in 2007. For customers who are not interested in participating in the program, there is a simple opt-out form available on NW Natural’s website here. (note that you have to log in to your NW Natural account to use this feature). The Billing Factor is also approved by both CUB and the Public Utility Commission, and CUB views it as a way to make billing more equitable for all customers.
If folks find themselves in Eugene on Friday, March 4, the University of Oregon’s Public Interest Environmental Law Conference will be hosting Dr Arjun Makhijani, the President of the Institute for Energy and Environmental Research, at 6:30PM in University of Oregon’s EMU Ballroom. Dr. Makhijani will be speaking on “A Carbon-Free and Nuclear-Free Electricity Sector: Need and Feasibility.”
Keep an eye out for CUB staff at the PIELC Conference this year, as Staff Attorney John Sturm and Business Director SA Anders will be in attendance.
Boardman Closure Update
Late last year we posted a summary of the long process that led to PGE’s agreement to close the Boardman coal plant by 2020. While that post did a good job of explaining the journey, there are enough remaining details left in the story that we felt it deserved another post. After all, this agreement is one of the biggest developments in the realm of Oregon utilities in quite some time.
The idea for closing Boardman early came about when the plant began to face federal Best Alternative Retrofit Technology (BART) rules to reduce haze and mercury pollution. These rules would have required PGE to invest roughly $500 million in the plant over the next few years to meet clean air standards. Early in the BART process, PGE had asked the Oregon Department of Environmental Quality (DEQ) to consider a rule that would have included options to close the plant in 2017, 2020, and 2027. In the early stages of its 2009 Integrated Resource Plan (IRP) process, PGE made preliminary estimates of the costs and risks of these scenarios, which showed that closing the plant in 2020 would be the least-cost option for customers. Aside from these off-ramp scenarios, which were all rejected by DEQ, PGE conducted all of its other modeling under the assumption that Boardman would remain online until at least 2040.
CUB could not get on board with extending the plant’s life to 2040. While the current political climate may prevent immediate action on climate change, it is highly likely that some form of climate regulations will emerge in the next 30 years that will make a coal-fired power plant an unprofitable enterprise. This is the argument CUB made in 2007 when PacifiCorp proposed the construction of three new coal plants. We won that argument, and frankly we don’t see much difference in building a new plant from the ground up and investing half a billion dollars in an existing plant. Nor could we get behind the proposals to shut the plant in 2011 or 2014. The Public Utility Commission (PUC) must approve an IRP based on which option is least-cost to customers. CUB believed that we could make a good case that a 2020 closure was least-cost, but we were skeptical that we could win an argument that a 2011 or 2014 closure was least-cost. So, CUB found another way.
CUB, along with the Renewable Northwest Project and the Northwest Energy Coalition, asked PGE to analyze a planning model that included shutting Boardman down completely in 2020. We were surprised but pleased when PGE agreed to do the analysis. We were even more surprised when PGE came back and stated in January 2010 that a 2020 closure appeared to be the least-cost, least risk option for customers. Of course, PGE still wanted a “backstop” of operating the plant until 2040 – the expected life of the plant – if things didn’t go as expected.
CUB and our allies were not willing to accept a 2040 closure date remaining on the table, and pressured PGE to petition DEQ to grant it a waiver for some air quality regulations in exchange for closing the plant early. PGE was reluctant, as DEQ had initially laid down guidelines that would call for a plant closure in either 2015 or 2040. CUB’s Executive Director, Bob Jenks, met with PGE’s Board of Directors in late 2009 and convinced them that continuing to make long-term investments in a coal plant would be a significant financial risk to both customers and shareholders in the face of eventual regulations on carbon emissions and other pressures to address climate change. At least in part due to Bob’s persuasion, PGE negotiated a deal with DEQ to operate Boardman until 2020 at the latest.
One of the most remarkable aspects of this victory is that, while it is certainly a huge environmental victory, its negotiation was couched in purely economic terms. The two authorities in Oregon to which PGE ultimately answers, the DEQ and the PUC, are not the arbiters of any sort of climate action. The PUC is charged with ensuring that utilities adopt least-cost, least-risk plans for the long-term provision of their services, while the DEQ was concerned with the most cost effective method to control haze producing air pollution, not carbon emissions. Nevertheless, CUB and other parties were able to demonstrate (and PGE’s own analysis confirmed) that the risk of costly carbon regulations, combined with avoiding costly air quality investments, created an economic benefit to PGE’s customers and shareholders.
While Boardman will still be generating power for up to another nine years, PGE and other interested parties are working towards developing a replacement resource for the plant, which is the company’s largest single generation resource. PGE has agreed to work with us on replacement power resources that have lower carbon emissions than a natural gas-fired plant. What that means exactly is yet to be determined, but it will likely be a mix of various types of renewable resources. PGE has a good history of investing in wind generation, and has also proposed an interesting plan to convert Boardman to a biomass facility and grow cane grass on thousands of acres in eastern Oregon to fuel it. Regardless of what the replacement ends up being, it will certainly be cleaner, cheaper, and less risky than extending the life of a coal plant for another 30 years.
Finally, we note that this is the first time there has been an agreement to close a modern coal plant in the United States. As such, this agreement is being watched by electric utilities and coal companies around the country. For utilities, it suggests that there may be a way to work with regulators and customers to reduce coal generation and eliminate clean air compliance costs. For coal companies, it is more troubling. It means that Oregon has determined that it is cheaper and less risky to close a modern coal plant than to make the investments necessary to keep burning coal. CUB is confident that this decision will ensure that Oregonians have a clean, stable, and affordable energy supply long into the future.
CUB Connects Presents at the Capitol
On February 7, 2011 the CUB Connects team headed to Salem to present the project to our representatives at the Oregon State Capitol. The presentation, held in Hearing Room 350 of the Capitol Building, was the first of many events that we are planning for 2011 to celebrate the launch of CUB Connects. Jeff Bissonnette opened the event with a brief introduction to CUB and the history of CUB Connects. Andrea Crosby, our Project Manager, explained the methodology and philosophy behind the site and walked the audience through the site’s interactive search tool and informational pages.
We have received very positive feedback about CUB Connects and look forward to presenting at other invents. We are excited to move beyond the beta-launch and into new phases of the project. Currently, staff is incorporating changes to the site based on feedback we’ve received, developing more features for the site and expanding purview of the CUB Connects blog - which follows local, regional and national telecom issues and events.
CUB hopes to present at more events throughout Oregon to increase the project’s visibility and connect to individuals or groups interested in consumer education and telecommunications. Please contact us with any suggestions or feedback by emailing our staff.
Follow us on Facebook and Twitter for more updates on CUB Connects and the world of telecommunications!
CUBConnects Presents at the Capitol
On February 7, 2011 the CUB Connects team headed to Salem to present the project to our representatives at the Oregon State Capitol. The presentation, held in Hearing Room 350 of the Capitol Building, was the first of many events that we are planning for 2011 to celebrate the launch of CUB Connects. Jeff Bissonnette opened the event with a brief introduction to CUB and the history of CUBConnects. Andrea Crosby, our Project Manager, explained the methodology and philosophy behind the site and walked the audience through the site’s interactive search tool and informational pages.
We have received very positive feedback about CUB Connects and look forward to presenting at other invents. We are excited to move beyond the beta-launch and into new phases of the project. Currently, staff is incorporating changes to the site based on feedback we’ve received, developing more features for the site and expanding purview of the CUB Connects blog - which follows local, regional and national telecom issues and events.
CUB hopes to present at more events throughout Oregon to increase the project’s visibility and connect to individuals or groups interested in consumer education and telecommunications. Please contact us with any suggestions or feedback by emailing our staff.
Follow us on Facebook and Twitter for more updates on CUB Connects and the world of telecommunications!
CUBConnects.org featured in the Oregonian – CUB Response!
On Tuesday, February 1st, 2011 the Oregonian published a great article about our new consumer education project CUBConnects. In the article, “Website aims to demystify Oregon telecom pricing”, Mike Rogoway fairly represented the history of the project, the complexity of the information that we’ve collected and the usefulness of the website.
One aspect of the project that wasn’t explained in the article is how we determine what plan pricing to display. We carefully selected a methodology that reflects the integrity and consumer-oriented focus of our project. Our search tool will not show you the “best price available”. It will show you the price of the plan without any deals or discounts. We do note when promotions are available in the additional details of the plan. Because promotions are short-term prices, and consumer will pay the full price when the promotion is over, we believe that the best way to offer consumers a comparison of multiple plans is to describe the price customers will be paying after the promotions end.
But, don’t give us credit for this methodology. It is consistent with the Maine office of Public Advocate rate guide and Consumers’ Reports.
Qwest spokesman Bob Gravely had it right when he said, “It (CUBConnects.org) does a good job of giving people a baseline. But if you really want to know what’s the best offer, you have to call your provider.” We want to provide consumers with an apples-to-apples comparison of the plans available in their area and encourage them to contact the providers for the deals available. But, when the promotion ends, and the price of the plan goes up, the price consumers will pay is often difficult to find – which is the information that CUBConnecs.org aims to provide for our fellow Oregonians.
Green Professionals Conference 2011
In honor of 2011, CUB has set a New Year’s resolution to better inform our members, followers and the general community through our blog. From here on out, you can expect to hear more regular updates about our advocacy efforts and opinions on issues that affect Oregon consumers and utility customers. Unlike most New Year’s resolutions, we are not going to let this one fall to the wayside.
To exhibit our good intentions, here’s our first blog of 2011.
In an effort to stay up-to-date on Energy Efficiency, Renewables and Sustainability issues in our region, CUB staff attended the 2011 Green Professionals Conference. The conference brings together individuals, businesses and organizations that are dedicated to a sustainable, clean energy economy with the goal of fostering new ideas and partnerships. Over 70 regional and local presenters participated in 15 sessions concerning a wide range of topics from the Smart Grid and Wind Energy Programs to Alternative and Emerging Energy Solutions.
Gordon Feighner, our utility analyst, attended a Smart Grid panel that focused on the interplay of the current energy grid and new technologies. The speakers did a nice job discussing the future of the energy grid, addressing the initiatives of Smart Grid Oregon and answering audience’s questions. The lack of a consumer advocate on the panel really demonstrates our need to stay involved in the Smart Grid discussion and represent the consumer interest as the topic develops.
The session “2011 Oregon Legislative Strategies for Energy Efficiency” depicted an interesting picture of the upcoming legislative session and the various proposals and initiatives that we can expect to see. John Strum, who has been aiding Jeff in preparation for the legislative session, attended this session and felt like the speakers mentioned things that CUB is aware of and prepared to work on as the 2011 legislative session evolves. We can expect legislative updates from John as the session progresses.
CUB Staff were also present for the Clean Energy Works panel, a very full session reviewing the Clean Energy Works pilot program in Portland and its gradual transition to a state-wide program. The program is designed to help homeowners have more streamlined access to financing and contractors for energy efficiency remodeling. Started in 2009, it helped to remodel over 450 homes in partnership with the Energy Trust of Oregon. In 2011 the program will begin to offer state-wide services for homeowners throughout Oregon and from the panel session those involved are very eager to expand the energy efficiency possibilities in the state.
The conference closed with an intriguing session on Alternative and Emerging Energy Solutions. The speakers were incredibly well versed in new areas of energy generation, including wave, geothermal and biomass energy production. The Q&A ended with an interesting discussion by the panel about the future of Boardman, the PGE Coal Plant that is scheduled to close in 2020. The conversation focused on the need to carefully develop innovative solutions for Boardman in order to create a successful template that can be adopted at other coal plants across the country as they close. The panelists emphasized our shared belief that Oregon can and will be the model for successful clean energy solutions and policies.
CUB staff looks forward to attending the conference again next year! Kudos to Fluid Market Strategies, the conference hosts, for all their hard work.
Balancing Today’s Rates and Tomorrow’s Needs
An article published last weekend in the Oregonian (“Rates set to jump for Pacific Power, PGE customers in January,” 12/17/2010) talked about the coming increases in utility rates. While the article touched on some important points, it didn’t give the full picture.
No one dislikes rate increases more than CUB does. We actually take them personally. But the issue is really about what we’re paying for versus what we could be paying for. And that’s what needs a deeper look here.
According to the Oregonian article, “the biggest factor driving the (rate) increases (is) renewable power.” Well, yes and no. Yes, there is the Renewable Energy Standard (RES), a state mandate to have 25 percent of the state’s energy load met by renewable resources by 2025. Yes, the utilities are making investment in new renewable generation resources. Are these investments more expensive? In the early years of the investment, a wind facility costs more than a gas plant but this changes as the wind facility is paid off and gas prices rise.
Over the life of a gas plant and the wind facility, the cost to customer is about the same. In fact, which resource is cheaper will be ultimately determined by what happens to natural gas prices over the next 25 years. Over the last decade, natural gas prices have been extremely volatile. Once a wind facility is built, its costs are known. When a gas plant is built, the future costs are largely unknown.
The region has been through this debate before. Some of the region’s hydro facilities were very controversial when they were built, not because of their effects on fish or rivers, but due to the high initial investment costs. People wondered whether customers could afford all this expensive investment in hydro.
Today, those investments are the base of our power supply in the region. Because hydro has no fuel costs, it provides the Pacific Northwest with rates that are lower than most of the rest of the country. In 15 years, the wind generators will be largely paid off and will be like another generation of cheap hydro power. So customers could pay a little less for a gas plant today, but we’ll likely pay more over time than we will for building a wind resource today.
Also, it’s important to remember that even with the RES, utilities are not required to meet the standard at all costs. The law says that if meeting the RES would push rates to more than 4 percent above what they would have been without the mandate, the utilities can suspend their investments until they can be made below that
“rate cap.”
What Else Contributes to the Rate Increases?
Despite the tone of the Oregonian article, it would be wrong to completely blame the investment in wind for these rate increases. Wind investment is part of this increase, but so is about $1 billion in investment in natural gas generation, upgrades to coal plants (both for PacifiCorp), and smart meters (for PGE). A large part of the increase is for investment in transmission facilities and, while utilities often link the transmission investment to wind, the truth is that the region has not invested significantly in transmission for 20 years, and new transmission is necessary no matter what the source of generation.
While some of the current increase is due to investment in renewables, what we don’t hear in the media discussion about the rate increases is a comparison between the current rate hikes and what rate hikes would exist if utilities made other resource choices. All utility investments cause increases in rates. And Oregon utilities are not simply investing in renewable projects because of the RES. They are investing in generation because they are currently short on the resources to meet future loads. Meeting those loads - as cost-effectively as possible over the long-term - is what is driving these decisions. If there were not rate increases due to renewables, there would be rate increases due to investment in fossil fuel generation.
Another part of the increase for Pacific Power is the cost for the eventual decommissioning of the hydro-generating dams in the Klamath basin. Why take out dams that are largely paid for and generate clean, renewable energy? Because the dams are up for federal relicensing (a process that happens every 50 years). Relicensing is a very expensive process, and in-depth analysis shows that it’s cheaper to decommission the dams and build new resources (again, over the long term) than it is to relicense the dams.
Utilities conduct customer surveys and focus groups. Those show that investing in renewables is popular. Because of this, utilities are quick to link rate increases to renewables, rather than to natural gas, coal, transmission, changes in generation sources, and fancy new meters. But that is disingenuous, because it is the total amount of investment utilities are making in all of these areas that are driving our rates higher.
We Need a Better Process to Look at All Investments
As we said at the start of this article, CUB is unhappy about the rate increases, even though we understand why they are happening. They show a serious flaw in the way utility planning and ratemaking is conducted in Oregon. During the 1990s, Oregon utilities made little investment in their systems. Utilities seemed to all have Enron-envy and were dreaming about how to get rich through deregulation. This led to neglect of the long-term needs of the power system.
Today they are rushing to make up for that period. But our planning process in Oregon does not deal well with multiple investments at one time. We take an individual investment and examine the various alternatives to determine what is the least cost way to achieve that goal (for example, we compare investing $500 million in clean air controls at Boardman with not making that investment and phasing out the plant). Each individual investment is examined in the context of least cost planning.
What is missing in the process is an examination of the timing of those investments and the rate impact of them in total. Should PGE have invested in smart meters and wind generation at the same time? Should Pacific Power have added transmission at the same time it is building wind facilities, a gas plant, and putting a scrubber on a coal plant? The timing of the investments has a large impact on the rate hikes. When multiple big investments are completed in the same year, it’s like stacking pancakes. As ratepayers, we prefer a short stack, but this year the utilities gave us a stack of pancakes that was much greater than our appetites - or our wallets - really wanted.
The process of utility planning in Oregon needs to recognize that when multiple projects are pancaked on top of each other, even if each investment is “least cost” over the life of that investment, the resulting rate increase can be larger than customers’ ability to absorb it. Utilities have to be directed to manage the affordability of electricity. This may mean that a particular investment in transmission or smart meters or new generation is delayed for a year or two - and the utility profits on that investment are delayed a year or two.
Utility investments must be managed in a way that keeps customers’ bills affordable. A comparison of utility bills versus household incomes show that utility bills are increasing at a rate that is significantly greater than household income. As an example, a decade ago, electric bills represented 1.6 % of the median family income for PGE customers. Today, the bill is approximately 2.6% of median family income. Oregon families simply cannot afford utility bills to increase faster than incomes.
What Got Taken Out of the Utilities’ Original Rate Requests?
Despite our criticism of the inability to consider “pancaked” investments, CUB was successful in chopping various costs out of the utilities’ original rate requests. It’s worth taking a look at what we could have been paying for in each utility’s request.
PacifiCorp: The original PacifiCorp filing asked for a 13.1 percent revenue requirement increase. Going through that filing with a sharp scalpel reduced it to 8.5 percent. Included in the reductions were:
* Maintaining the rate of return (PacifiCorp’s profit) at 10.125 percent - this provided a reduction of $20.3 million to the PacifiCorp requested rate of 10.6 percent;
* The reduction of administrative and general costs to reflect changes in PacifiCorp’s property and liability insurance - this provided a $2 million a reduction;
* A reduction to reflect reduced cost projections for the Populus to Terminal Transmission line - this provided a $500,000 reduction (and this is being further reduced in a recent PacifiCorp filing);
* A reduction in operations and maintenance amounts for wages, benefits, incentives and non-labor escalations - this provided a reduction of $20.9 million;
* A credit for renewable energy certificates that PacifiCorp cannot use in Oregon but can sell to out-of-state entities - this provided a reduction of $2.5 million.
Taken together, these adjustments reduced PacifiCorp’s proposed revenue increase from $130.9 million to $84.6 million.
PGE: PGE’s original filing requested a $157.8 million increase, excluding power costs. The sharp scalpel took out a number of proposed expenses and the request was reduced to $100.2 million. The reductions that made this possible included:
* Setting PGE’s rate of return on equity at 10.0%, instead of the Company’s requested return of 10.5%;
* A reduction in employee compensation of $6.48 million;
* Pension reductions of $10.94 million and $700,000;
* A $1.7 million Advanced Meter Infrastructure credit;
* An Information-Technology-related reduction of $1.47 million;
* A reduction for customer service and transmission costs of $1.28 million;
* Reductions in non-labor components of $2.29 million;
* Capital cost reductions of $5.94 million;
* $1.14 million reduction in the Biglow Canyon wind facility costs;
* Additional wage and salary decreases of $3.5 million;
* Reduction in Boardman fly-ash costs of $2.6 million;
* Miscellaneous other reductions totaling $3.8 million;
* A reduction in storm damage estimates of $3.6 million.
How Does CUB Approach Proposed Rate Increases?
CUB looks at each proposed increase with a skeptical eye and fights vigorously to keep increases in check. Our two staff analysts conduct the in-house analyses and we hire expert consultants to review issues where we are out of our depth. We pare back proposed increases where we believe that’s necessary and actually make fun of those we think are simply ridiculous.
There are times, however, when at least parts of requested rate increases are justified, and this was one of those occasions. The infrastructure build-out is necessary to deal with future load projections, with or without attempts to meet Oregon’s renewable energy goals. As noted before, we have and will continue to advocate for better planning for and better implementation of infrastructure investments. But when it comes right down to it, the infrastructure is needed - but we need to do better managing the timing of the investments.
Don’t Forget about Energy Efficiency
We’ll say a quick word about making sure that your home is as energy efficient as possible. No matter what rates do, there’s no sense in paying for wasted energy. So we encourage all utility consumers, especially low income families, to take advantage of the services offered by the Energy Trust of Oregon and low-income advocacy groups to make energy efficiency changes to their homes. True, some fixes can cost a lot of money but there are many other fixes that can be easily accomplished that will save consumers considerably and reduce the load growth that drives infrastructure build-out and increased rates. To find out more, contact the Energy Trust or your local community action agency (to find your local agency, go to the Community Action Partnership of Oregon’s website.
Conclusion
It’s hard to deal with rate hikes during a terrible recessions, even to fund needed investments. It’s a little like having a mechanic tell you that a new expensive engine on your car will never need oil changes and will save you money in the long run. It’s good to know that you’ll pay less over time but it still hurts now.
While we can all hope for a period of rate stability after these increases, there is no moratorium on utility filings in place for either PacifiCorp or PGE, and it is possible that each may file general rate cases again in 2011. CUB encourages the companies to avoid such a move, but if they determine that they cannot, CUB will be ready once more to ensure that customers are getting the best value for what they pay for.
CUB will continue to make sure that we fight against every unneeded expense in utility rates to keep rates down today, but also make sure that we avoid being penny-wise and pound-foolish by insisting that utilities make the right investments for the future.
The Changing Path of a Three-Year Conversation
Back in 2007, you would have heard the following (paraphrased) conversation in the CUB office:
“PGE is going to ask to spend $500 million to improve air quality at the Boardman coal plant.”
“Yeah, it’s not a good idea to spend a bunch of money on a coal plant but we’re having enough trouble trying to stop new coal plants (note: something PacifiCorp was proposing at the time). I’m not sure we can make a case that would lead to an early closure of a modern baseload coal plant.”
“You’re probably right. But let’s keep thinking about it. Maybe we’ll get a chance to talk about investing that half a billion dollars in better ways to move away from coal.”
In the three years since that (semi-fictitious) conversation happened, to combine the words of both the Grateful Dead and the Beatles, “what a long, strange trip it’s been” on a “long and winding road.” Months and months and months of meetings, hearings, negotiations and workshops dealing with a utility once committed to decades of coal, two state regulatory agencies and a federal regulatory agency led to an outcome yesterday that three years ago seemed near impossible: the Boardman coal plant, Oregon’s largest emitter of greenhouse gases, will close at least 20 years early…and that is now in rule as state policy and practice. This means that customers are no longer being asked to invest hundreds of millions of dollars in order to allow the plant to keep running.
EXTENDED BODY:
A little more than two weeks ago, the Oregon Public Utility Commission (PUC) acknowledged Portland General Electric’s (PGE) Integrated Resource Plan (IRP), which included a proposed plan to close Boardman by 2020. But to ensure that that early closure date actually changed investment and operation decisions, we needed that closure date in rule. That was the job of the Environmental Quality Commission (EQC), which oversees the Oregon Department of Environmental Quality (DEQ). And yesterday, the EQC voted unanimously to adopt a rule that puts the closure date at 2020 (at the latest).
So how did we get here and where do we go next?
The main challenge was to formulate an economic argument that could be accepted by the PUC but that could also pass environmental muster at DEQ and the federal Environmental Protection Agency (EPA). As part of PGE’s IRP process, CUB, along with the Renewable Northwest Project (RNP) and the Northwest Energy Coalition (NWEC), asked PGE in 2009 to analyze a planning model that included shutting down Boardman completely in 2020. We were surprised but pleased when PGE agreed to do that analysis.
We were even more surprised when PGE came back and stated that a 2020 closure appeared to be the least-cost, least risk option for customers. That became their public position in January 2010. Of course, PGE still wanted a “backstop” of operating the plant until 2040 - the expected life of the plant - if things didn’t go as expected. But that backstop was not something that CUB and its allies were willing to accept.
Other organizations wanted an earlier closure date than 2020, arguing that PGE shouldn’t be able to continue to operate without making the needed clean air investments. While CUB agreed that some clean air investment needed to be made, investing hundreds of millions of dollars would force the plant to operate beyond 2020 in order to allow time to recover those investments from customers. In addition, those investments would do nothing to reduce greenhouse gas emissions which affect climate change. Finally, we need to have time to plan for the replacement power and bring it online in a way that balances both the ratepayer interests and the environment.
As we’ve written before, CUB’s goals in this process were three-fold: 1) protect ratepayers by keeping the costs of closure and replacement power under control; 2) protect the environment and reduce greenhouse gas emissions by shuttering a coal plant early and developing a clean energy solution for replacement power; and 3) perhaps provide a path for other, more heavily coal-dependent utilities to follow in shutting down their coal plants early.
The agreement that was acknowledged by the PUC and approved by the EQC accomplishes all of those goals. We will avoid the massive investment in a coal plant. We will make a reasonable level of investment to ensure that air pollutants are significantly reduced over the next decade. PGE has committed to a process in the next IRP to determine how we can replace Boardman with a cleaner energy mix than just replacing Boardman with a gas plant. And we needed to do so in a way that the PUC could find to be the “least cost option,” and DEQ could find make reasonable progress towards reducing air emissions that contribute to haze.
And, best of all, 2020 is now the latest the plant can operate,
2040.
What does that really mean? It means that any investment decision is now made with a 2020 closure date in mind. What if the federal government issues rules that requires investments to comply with more stringent clean air requirements? We would have to examine whether that investment made sense in the context of the fact that the plant is now closing by 2020. What if something breaks down at the plant? We would have to examine whether the investment needed to fix whatever went wrong made sense in light of a 2020 closure date. And if that means closing the plant earlier than 2020? If that’s what makes economic sense, knowing that 2020 is a firm closure date, that’s what we’ll have to do.
What about that goal of providing a path for other utilities to follow in shutting down other coal plants? Boardman began producing power in 1980. It is a relatively young plant and no one in the country has closed a comparable plant. This decision is generating a great deal of attention with other utilities and climate activists. We’ll have to see how that plays out. But if Oregon can do this with Boardman, other states can do it with other coal plants.
There are lots of thanks to go around. In addition to RNP and NWEC, the Oregon Environmental Council worked tirelessly to craft a final agreement that would satisfy the environmental regulators. And Angus Duncan, a very experienced energy and climate policy expert was deeply involved in providing options that kept the discussions going to a successful conclusion. And, of course, CUB members played a key role in helping us keep the process on track. A little grassroots pressure helped to show that Oregonians were closely watching the discussions. You really made a big difference with your phone calls and e-mails. So many thanks and congratulations all around on a job well done. And now we’ll have to work to make Boardman’s early closure a workable reality.
Oh, by the way…those coal plants proposed by PacifiCorp back in 2007? We beat those back.
Making Sure Your Dollars Help Heat Your Home - and Don’t Fill State Budget Holes
You’ve heard time and again from us about the importance of energy efficiency. You’ve read over and over how important those investments are to ratepayers. You’ve heard about how critical we think the work of Energy Trust of Oregon is to ensuring we continue to get savings from energy efficiency in order to keep rates under control and reduce carbon emissions.
But it’s not only us that’s saying it. A few weeks ago, the American Council for an Energy-Efficient Economy (ACEEE) released its “State Energy Efficiency Scorecard,” which showed that Oregon is number 3 in the nation for energy efficiency investments (up one spot from two years ago - when the last scorecard was released – behind California and Massachusetts). As the executive summary of the report, which also looks at energy use in the transportation sector, noted, “Governors, state legislators and officials, and citizens increasingly recognize energy efficiency - the kilowatt hours and gallons of gasoline that we don’t use thanks to improved technologies and practices - as the cheapest, cleanest and quickest energy resource to deploy.” Sound familiar? (You can read the whole report here).
It’s the time of year, as cooler weather sets in, when more people start thinking about ways to make their homes warmer and more comfortable…and save money on their utility bills to boot. But we want to make sure you’re also thinking about energy efficiency come January when the legislature gets underway. Why? Because there’s a very good chance that the next legislative session will try to re-direct ratepayer money dedicated to energy efficiency to fill holes in the state budget.
We’ve seen it before. Back in five special sessions in 2002 and the regular session in 2003, CUB members and other allies fought off many attempts by the legislator to use “public purpose” dollars - money that is collected from ratepayers specifically to fund energy efficiency and renewable energy projects. Most of these dollars are administered (very well, we might add) by the Energy Trust but some also goes to weatherizing low-income homes and schools.
Not only is it problematic when the legislature tries to re-direct energy efficiency money to other purposes, it’s also not their money to allocate in the first place. Public purpose dollars are ratepayer funds, not taxpayer funds. That means that the money is collected in rates from the consumers of two electric utilities (Portland General Electric and Pacific Power) for a specific purpose (ie. - energy efficiency and some renewable investment). The money is not tax dollars collected to meet the general needs of the state.
We’ve managed to fend off these attempts in the past (most recently in 2007 when the legislature tried to help the Oregon Museum of Science and Industry (OMSI) pay off a state loan, which the governor vetoed) but the state budget is a real mess. Legislators will literally be looking for every dime that is not nailed down. And the recent elections definitely made the situation more complex by having split representation in the House and a very narrow Democratic majority in the Senate.
No matter what, we fully expect several attempted raids on the public purpose funds. And we’re going to need CUB members to be willing to call, e-mail and talk to their local legislator about the need to continue these needed investments in energy efficiency and how it’s improper (and probably illegal) to re-direct public purpose dollars. You can be sure to hear a lot more about this as 2011 dawns.
Until then, here are several no-cost and low-cost ways, suggested by the Energy Trust, that can help you save money and stay warmer this winter.
No-Cost Solutions
* Unplug! From battery chargers to kitchen appliances, you can save money by unplugging them when not in use.
* Check out a Kill A Watt® energy monitor from a participating library to see where you can cut back on your electricity.
* Turn off lights! When you leave a room, flip the switch.
* When possible, use a countertop convection, microwave or smaller electric appliance, instead of a full-size stove.
* Turn down the thermostat to 65 - 68 degrees during the day and 58 - 60 degrees at night during cooler months. If you have a heat pump, turn the thermostat down no more than 10 degrees at night.
* Wash and rinse laundry with cold water, and run full loads.
* Clean lint filters after drying each load of clothes.
* Use the water-saver washing and energy-saver options on your dishwasher.
* Check to make sure refrigerator and freezer gaskets seal tightly.
* Close fireplace and wood stove dampers when not in use, but wait until several hours after the fire is out and the ashes are cold.
* Recycle your old refrigerator or freezer. Energy Trust will pick it up for free and send you $50 cash now through December 31, 2010!
Low-Cost Solutions
* Replace standard incandescent light bulbs with compact fluorescent light bulbs (CFLs).
* Install water-saving showerheads and faucet aerators.
* Clean or replace filters before and after heating season to help your furnace or heat pump work at peak efficiency.
* Install an ENERGY STAR programmable thermostat.
* Caulk small holes and cracks around plumbing pipes, exhaust fans, dryer vents, sink and bathtub drains, fireplaces and under countertops.
* Use pots and pans with flat bottoms.
* Install exterior wall switch and outlet gaskets to prevent air loss and infiltration.
And if you are serious about doing some in-depth weatherization work? There are several programs in Portland that provide free energy audits and cash incentives for homeowners and renters who want to invest in weatherization.
The Energy Trust offers a variety of cash incentives, often up to 50 percent of the cost, for home weatherization projects including air sealing, duct insulation, duct sealing, either professional or self-installed insulation and windows.
Also, if you live in Portland, Clean Energy Works is a City of Portland pilot project that is assisting 500 qualified Portland homes finance and install energy efficient upgrades. The program offers a free energy audit and low-cost financing for energy-efficient home improvements like installing new insulation or a high-efficiency water heater or furnace.
Participating households are able to make use of Energy Trust’s cash incentives for their home improvements and are provided a qualified Energy Advocate to assist them throughout the process. Once the improvements are completed, participants pay off the costs over a 20-year period, with payments added onto their electric or gas bills.
The scope of the pilot project is currently limited to 500 households, and to qualify, the homes must be owner-occupied and located in the city of Portland. Homes with the most potential for energy savings are given priority. To find out more about if you qualify and how to apply, visit their website.
Don’t get left out in the cold! Look into energy efficiency today!
Introducing CUB Connects
There are hundreds of telecom service providers throughout Oregon, offering a wide range of service plans and features. The differences between these plans, the hidden fees and taxes attached to them and the varying terminology can make it difficult for consumers to distinguish which service plan is best for them.
That is why we are proud to introduce CUB Connects, a new project of the CUB Policy Center. CUB Connects was created in order to assist Oregon consumers in sifting through the variety of plans available for local, long distance, and wireless phone service, as well as internet service.
We are currently compiling data and rates from all the telecom service providers in Oregon. This information will be made available on a new website (not yet available), in the form of an interactive search tool. This first-of-its-kind search tool will provide consumers with the ability to make apples-to-apples comparisons between companies and service plans that are available in their area.
As the CUB Connects project develops, we will offer a hotline for consumers to call for assistance with the website or with help understanding the various services and plans. This will be available to consumers throughout Oregon, to better help citizens chose the right telecommunications service for them. We also hope to hold workshops around the state to reach out and further educate consumers about their telecom service options.
We’re in the process of developing our website, CUBConnects.org, and hope that it will be available soon for consumer use. Expect more news out of CUB Connects as we pull everything together!
And, let’s introduce the CUB Connects Project Team:
Andrea Crosby, the new Project Manager for CUB Connects, is originally from New Hampshire. She happily finds herself on the West Coast after 3+ years living in Ecuador where she was a Peace Corps volunteer and then a Project Coordinator for an international conservation foundation. Before taking off to South America, Andrea researched global climate change models at NASA and the University of New Hampshire. She has a BS Degree in Environmental Sciences from Duke University.
Ghassan Ammar, the new Project Support Coordinator for CUB Connects, grew up in Pennsylvania, earned a BA Degree in both Writing and Media Arts from Emerson College in Boston, and spent the past few years atop a mountain in upstate New York, working as a manager for a Tibetan Buddhist retreat center. He is very happy to now be enjoying the fresh air of the Pacific Northwest.
