30th Anniversary Retrospective: Transition From Coal

Birthdays and anniversaries have a way of building perspective. They also help us take stock of what remains to be accomplished. This year, CUB celebrates 30 years of advocacy, and we’re taking some time to reflect on our accomplishments and what the future holds as we continue to build toward Oregon’s clean energy future. One issue area stands out as timely for such reflection: coal, and its place in the energy landscape of Oregon and the Pacific Northwest.

CUB is now preparing to enter the third year of our “Transition from Coal” program, recognizing that in response to climate change, state, regional, and national policies are being put in place that will reduce and ultimately eliminate the practice of creating electricity through the burning of pulverized coal. CUB believes that the most affordable way to get in front of this problem is to acknowledge the need for a proactive and cost-effective transition. This can be done by promoting investment in energy efficiency programs, increased grid flexibility, and renewable energy projects, while looking critically at utilities’ plans to invest in their aging coal plants. We have already accomplished some important milestones, but how did we get to this point? What important policy shifts helped shape these successes and our ability to build on them?

CUB first wrote about coal and climate change in our January 1989 newsletter. We noted that Pacific Power produced more than 50% of its electricity from coal, we advocated for less carbon intensive fuels, and most importantly, we argued for the expansion of energy efficiency efforts, since efficiency is a cheaper and cleaner resource than the processing of fuels. CUB continued to push for investment in efficiency and renewables throughout the 1990s, but the utilities were resistant. CUB advocated for the creation of the Energy Trust of Oregon (ETO) in order to ensure that energy efficiency investments would be consistently prioritized. In its 12-year history, the ETO has gained $1.3 billion in energy savings for participating customers of PGE, Pacific Power, Northwest Natural, and Cascade Natural Gas.

But even with an increasing emphasis on energy efficiency, the utilities did not stop promoting coal. Pacific Power proposed building new coal plants in its 2004 and 2007 resource plans. In our comments on the 2004 plan, CUB called it “imprudent in the extreme” for an already coal-heavy utility like Pacific Power to build more coal plants when scientists were calling for reductions in carbon emissions. CUB challenged Pacific Power’s plans and won - in 2007 the Oregon Public Utility Commission (OPUC) refused to acknowledge Pacific Power’s addition of new coal plants as a reasonable strategy.

That same year, CUB helped to create the Renewable Energy Standard for Oregon through the passage of SB 838. The new law required that by 2025 at least 25% of Oregon’s electric energy must be generated by renewable resources. The year 2007 also saw Oregon’s adoption of greenhouse gas emissions reduction targets when Governor Kulongoski signed House Bill (HB) 3543. This same bill also established Oregon’s Global Warming Commission, as well as the Oregon Climate Research Institute (now based at Oregon State University).

The goals established in HB 3543, combined with the work of the Global Warming Commission, paved the way for SB 101 (passed in 2009), which established an emissions performance standard and required that any base-load facilities serving Oregon customers have emissions that are at least as clean as a modern natural gas plant. Effectively, because coal plants are not capable of meeting these standards, SB 101 prohibits Oregon’s utilities from building any new coal plants.

By 2009, we had successfully advocated for policies that shifted new investment to energy efficiency and renewables, however, a large share of Oregon’s energy was still coming from the 30 coal plants that fed power to Pacific Power, PGE, and Idaho Power. CUB was waiting for an opportunity to tackle this problem and one was presented when PGE needed to invest more than $500 million into the Boardman coal plant, the only coal plant located in Oregon, in order to meet federal clean air requirements. CUB grabbed this opportunity and called on PGE to consider phasing out the plant as an alternative to pollution control investment.

At first, PGE refused to consider CUB’s proposal, but ultimately PGE agreed to model the phasing out of the plant by 2020. The results showed that it would be cheaper for customers if PGE closed the plant in 2020 rather than investing the necessary $500 million in order to keep the plant running until 2040. To their credit, after the results of the analysis were released, PGE got on board and agreed to the early closure. CUB and PGE were able to work together to get the OPUC and the Oregon Department of Environmental Quality to adopt the 2020 closure. This was not an easy task – the concepts of phasing out a plant to avoid pollution control costs, and closure of a modern baseload coal plant, were both completely unprecedented.

Since the PGE Boardman decision, CUB has worked hard to get Pacific Power and Idaho Power to apply the same type of analysis to their coal plants. Just like PGE, they face significant coal plant related investment costs in order to comply with federal clean air rules. Unlike PGE, they have been unwilling to work with CUB on analyzing the potential for phasing out coal plants.

But CUB doesn’t give up easily. In December of 2012, the OPUC leveled a $17 million penalty against Pacific Power for failing to conduct the requested phase out analysis before investing $170 million in its coal plants. And Pacific Power has now committed to closing two smaller coal plants and converting one to natural gas. With new EPA draft rules coming out this summer, the pressure on both Pacific Power and Idaho Power to reduce their dependence on coal will only grow.

CUB’s work in this arena is by no means done. Oregon customers are still at risk of future carbon regulation increasing our electric rates because our utilities are too dependent on coal. While we have made headway, there is still much work to be done to transition our utilities away from coal and to develop feasible clean energy options. We are aiming to set standards for Oregon that will in turn affect utility policy throughout the west and ensure a cleaner, more affordable energy future. Stay tuned for updates as our Transition from Coal program develops!

This post is part of a year-long retrospective blog series celebrating CUB’s 30th anniversary. We are grateful to our members and our partners for tirelessly supporting our growth and sustaining our work through the past three decades, and we are excited to share our history with you throughout 2014. Follow our 30th anniversary blog series and find out how else we’re celebrating!

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