Two Birds With One Stone
Posted on July 25, 2014 by Nadine Hanhan
Tags, Consumers and Utility Customers, Utility Regulation
Last year, CUB wrote about Pacific Power’s and Idaho Power’s Integrated Resource Plans (IRPs). As you might recall, an IRP is a document that outlines how a utility intends to meet its resource needs in a least-cost/least-risk manner over an upcoming 20-year period. In the IRP, the utility compares the results of various combinations—or “resource portfolios”—of potential resources (wind, coal, gas, energy efficiency, etc.) to determine which resource portfolio is the least-cost/least-risk path to meeting the demand of the utility’s customers. The Public Utility Commission “acknowledges” IRPs if they satisfy various conditions, but acknowledgment does not equal pre-approval of a utility’s integrated resource plan.
This past year both Pacific Power and Idaho Power requested acknowledgment for environmental upgrades to electricity generation units powered by coal. One coal plant in particular, the Jim Bridger plant, is actually owned by both companies, so there is some crossover between each of the companies’ IRPs. As CUB has pointed out in the past through comments and blogs, CUB questions whether the requested environmental upgrades are cost-effective. CUB believes that both companies should have broadened their analyses to include other options to the upgrades, such as a phase-out of the coal plants, much like the case of Boardman and its planned 2020 closure.
On July 8, 2014, the Commission stated its agreement with CUB through the issuance of two orders — LC 57, the Pacific Power IRP, and LC 58, the Idaho Power IRP.
In LC 57, the Commission did not acknowledge Pacific Power’s pollution control investments for two generating units at the Jim Bridger coal plant located in Wyoming. In LC 58, the Commission also did not grant acknowledgment for these same investments for Idaho Power. In addition, the Commission did not acknowledge pollution control investments in Pacific Power’s Hunter coal plant located in Utah.
The Commission’s actions send a clear message to the utilities that they must improve their resource modeling so that they can make more cost-effective resource decisions.
The Commission also ordered Pacific Power to 1) provide quarterly updates to its coal analysis to ensure that stakeholders are updated about its major investments and 2) restructure its coal analysis to account for the cost-effectiveness of early shutdown scenarios. This reinforces the message that utilities must take analysis of alternative resource options far more seriously so as to avoid costly environmental upgrades. This does not mean that CUB does not support environmental stewardship, but if the upgrades are expensive and can be avoided through an early coal plant closure, it is better for both customer pocketbooks and the environment to shutter the plant before the end of its useful life.
CUB will continue to fight for lower-cost resources in the future, and we will keep you updated on future resource plans!
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04/14/17 | 0 Comments | Two Birds With One Stone