Surveying Oregon’s Energy Future: Conference Report

One of the things I enjoy the most as a CUB staffer is getting out to conferences and hearing about how various stakeholders are thinking and working through the big issues in the energy industry. These events help me situate CUB’s work in the larger context of the business, policy, and regulatory landscapes of Oregon and the Pacific Northwest.

On Wednesday April 13, I had the privilege of attending Oregon’s Energy Future Conference, put on by the Northwest Environmental Business Council (NEBC). I joined about 200 folks from energy businesses, consulting firms, utilities, regulatory agencies, and other advocates for a day of engaging presentations and panel discussions. No one blog article can effectively capture the many topics that were incorporated, but here are some highlights:

The morning’s opening panel brought together experts from the fields of renewable energy business, research, and advocacy to discuss bulk power purchasing. A big takeaway from this discussion was that large power purchasers like Amazon Web Services (whose Senior Manager of Energy Strategy, Nat Sahlstrom, sat on the panel) are interested in investing in renewable resources, but it’s more difficult for them to do so in the Northwest, where the power system is more balkanized, than in regional interconnection systems like PJM (which serves all or parts of 13 states in the Midwest and Mid East Coast as well as the District of Columbia.)

For the first breakout session, I attended a panel discussing “Clean Energy Planning & Outlook for Oregon”, moderated by Sara Parsons of SunPower. This panel featured presentations by Wendy Gerlitz of NW Energy Coalition, Cameron Yourkowski of Renewable NW, and Franco Albi of PGE. Gerlitz opened with an impassioned defense of energy efficiency as a go-to resource – the most important first stop before investing in renewable resources or fossil fuels (CUB has shared this position for many years.) It was a widely publicized finding of the NW Planning and Conservation Council’s seventh power plan that energy efficiency can meet the majority of added energy load by the year 2035, but Gerlitz challenged the finding in the same plan that natural gas should meet upwards of 2000 MW of added load within that same time frame. The crux of her argument was that for pretty much the whole history of energy planning in the Pacific Northwest, about 15% of technically possible energy efficiency has been shaved off to give the “achievable” quantity, and that this standard needs to be reexamined in light of recent technological and regulatory developments. Once the bar is raised for what is achievable, the potential of cost-effective efficiency will rise as well.

The potential of demand response was also a hot-button topic. Franco Albi discussed a pilot project that PGE attempted to limit power usage by large and small businesses during peak evening hours: the initial “stick” approach imposed a fee on customers who went over a quota, and this route proved ineffective. PGE is now having much more success with a “carrot” incentive that offers a small rebate for business customers who effectively curtail their peak hour energy usage. Wendy Gerlitz’s motivating take on demand response was that Oregon needs “to move beyond pilot projects and really DO this stuff.”

Session 2 offered a Renewables Market Update on “Solar and Small Hydro”, featuring testimonials from three very different players: Julie Davies O’Shea from the Farmers Conservation Alliance (FCA), Cindy Dolezal of the Public Utility Commission, and CUB’s own former Policy Director and now Executive Director of OSEIA, Jeff Bissonnette. Julie Davies O’Shea began with the fascinating story of the FCA’s foray into installing Farmers’ Screens (agriculturally optimized fish screens for farmers). Across irrigation districts in the state of Oregon and throughout the Northwest, it was discovered that the infrastructure was 100-200 years old and screens had to be custom-fitted. This process has proven to be very expensive and time-consuming, but it also opens the door for potentially thousands of in-pipe hydro projects that can provide a financial benefit to the irrigation districts and help them fund further infrastructure updates. Learn more about the FCA at http://fcasolutions.org/.

Cindy Dolezal gave a presentation on the PUC’s general process for proceeding through dockets, and then gave a brief rundown of a few different dockets that are currently in process at the Commission, including the Resource Value of Solar, on which a decision is expected in late 2016 or early 2017, and the various rules and procedures that must be reevaluated in light of the passage of SB 1547, the Clean Electricity and Coal Transition Act.

At this point in the session an overarching theme to the day began to emerge: now is a really exciting and transitional time for the solar industry. Dolezel reminded the crowd that the PUC is also currently evaluating all solar programs in Oregon under order of 2015’s HB 2941; at the end of that process each project will be either extended, shut down, adjusted, or unchanged. Additionally, Jeff Bissonnette highlighted that the federal Solar Investment Tax Credit was extended in December 2015, a move which was widely unexpected. Further change is on the horizon due to the passage of both the utility-scale solar bill in the 2016 short session, and the community solar provision of SB 1547 (though the small-scale renewables requirement has provoked contradictory interpretations, which will need to be resolved either by the PUC and/or future amendments to the bill). Additionally, the PUC is just beginning to work on rulemaking in response to SB 1547, so the scope of the community solar provision, and who exactly will be allowed to participate, remains to be seen.

The third breakout session of the day provided a peek into the political process of forming clean energy policy in Oregon. Tim Miller, CEO of Enhabit, facilitated a panel discussion between four members of Oregon’s legislature: Representative Cliff Bentz, Senator Chris Edwards, Representative Barbara Smith Warner, and Representative Jessica Vega Pederson (who acted as chief petitioner for the Clean Electricity and Coal Transition Act). They had a spirited discussion about clean energy politics, and shared particularly fascinating insights into the priorities of their constituents and how those priorities have shaped their policy positions. The basic theme was that most legislators in Oregon, like most voters in the state, agree that climate change is real and needs to be addressed, but there is disagreement about what steps to take. 2017’s long legislative session will be one to watch for further developments, particularly in clean transportation funding and the “Healthy Climate bill” which environmental advocates have already identified as a high priority.

My time in the final breakout session was split between two different topics: in the first, “Energy Technologies Revisited” I heard a presentation by Anna Chittum of Gridkraft on Combined Heat and Power, a technology which she argued has been under-utilized in Oregon given its potential to save money and reduce carbon emissions. In the second panel I visited, “The Call for Customer Choice”, I was lucky to arrive in time to hear Richard Lorenz of Cable Huston LLP offer an insightful comparison: customer choice in the classic IOU regulated monopoly model was a lot like Ford’s Model T in the early 1920s: a customer could have the car painted “any color that he wants so long as it is black”. The metaphor that the utility industry is chasing today is more like Tesla’s Model S, where customer choice is paramount and their energy must meet a variety of standards, namely: reliability, affordability, and a low impact on the environment. Going from “Model T” to “Model S” will require Oregon’s utilities to more rigorously analyze shifting costs, open up pilot projects to more customers, allow cost-based special contracts, and allow more customer-owned generation, among other changes.

The full agenda and uploaded presentations can be found here. My thanks to NEBC Executive Director Robert Grott (whose retirement later this year was celebrated in a moving speech by Margie Harris) as well as the rest of the NEBC staff and conference presenters for an engaging day exploring Oregon’s Energy Future!

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