“When you have a co-op that’s willing to step up and invest in their own generation, and particularly clean generation, that should be supported.”
New Mexico Senator Martin Heinrich highlighted frustrations about Tri-State Generation and Transmission Association’s limits on local renewable energy projects, during a Senate Energy and Natural Resources Committee hearing yesterday focused on “Rural Energy Challenges and Opportunities.”
Senator Heinrich noted that one electric cooperative in New Mexico ended its contract with Tri-State, in order to pursue more local solar energy projects, and he asked a representative of Basin Electric (which sells power to Tri-State) about Tri-State’s policies that have limited electric cooperatives in New Mexico from pursuing more than 5% of their power needs from local sources. Senator Heinrich's comments are shown in this video, and transcribed below.
A report published last week by Moody’s Investors Service found that most coal plants owned by municipal utilities and generation and transmission associations are now more expensive than new renewable energy. From Moody’s press release:
Most municipal- or G&T-owned coal plants in the US are old and have high production costs. According to the report, 72.3% of these plants, or about 65.0 gigawatts, have operating costs exceeding $30 per megawatt hour, which Moody's views as the threshold above which coal plants are vulnerable to be displaced by cheaper generation options.
The report provides costs and other details about several coal units, including those owned by Tri-State Generation and Transmission Association - the Escalante coal plant in western New Mexico, all three units at the Craig coal plant in northwest Colorado, and unit 3 of the Springerville coal plant in eastern Arizona. According to Moody’s report, each of those five coal units’ total production costs in 2016 were higher than that $30 per megawatt hour threshold.
Most residents of rural Colorado and New Mexico buy electricity from electric cooperatives, and most of the electric cooperatives in each state buy electricity from Tri-State Generation and Transmission Association. As part of their power supply contracts with Tri-State, each of those co-ops are currently limited to providing just 5% of their electricity needs from local renewable energy projects, and must purchase the rest from Tri-State.
Tri-State’s limits on local energy development are a growing problem for co-op members in both states, as more co-ops seek the cost savings and other advantages of renewable energy. Surveys of the 18 co-ops in Colorado and 11 co-ops in New Mexico that buy power from Tri-State show an increasing number of co-ops that are approaching the 5% limit. The survey results show that at least five co-ops have reached the 5% limit on local energy development, including United Power, La Plata Electric, Delta-Montrose Electric, San Miguel Power, and Mora-San Miguel Electric.
Moreover, another eight co-ops are approaching the 5% limit, including Poudre Valley Electric, Otero County Electric, Central New Mexico Electric, San Luis Valley Electric, Sangre de Cristo Electric, Highline Electric, Southeast Colorado Power, and Sierra Electric.
By Joe Smyth | email@example.com | @joesmyth
Denver - Colorado Governor John Hickenlooper delivered the keynote address to the Climate Leadership Conference in Denver today, highlighting the state’s efforts to accelerate the transition to renewable energy by working with companies and municipalities throughout the state.
A glimpse of the "infinite scalability" of energy storage, and some other key takeaways from this very exciting utility bid solicitation
After I posted Xcel Energy’s report showing unprecedented low prices for renewable energy and storage bids, several energy industry experts added some helpful context and analysis of the implications of these bids.
Much of that discussion focused on the low bid prices for projects that would combine renewable energy with energy storage. The Xcel Energy report showed that the median bid price for solar and storage projects was $36/MWh, while the median bid price for wind and storage projects was just $21/MWh. There were also seven bids for combined wind and solar and storage bids, with a median price of $30.60/MWh.
"The numbers in these bids are the lowest prices we have seen for any combination of renewable plus battery storage," said Ravi Manghani, director of energy storage at Green Tech Media.
Matt Gray, Utilities & Power Senior Analyst at Carbon Tracker, added: “Based on our modelling, the median bid for wind plus storage is lower than the operating cost of all coal plants currently in Colorado, while the median solar plus storage bid is lower than 74% of operating coal capacity.”
Utilities in Colorado are planning to add a lot more renewable energy over the next few years, for a variety of reasons. I’ve looked at a couple of the trends driving this energy transition such as 100% renewable energy commitments from the utilities’ major customers, including towns and cities like Pueblo and Boulder, and major companies like Aspen Skiing Company, Google, Vail Resorts, IBM, Anheuser-Busch, and New Belgium.
But perhaps the biggest reason that utilities in the region are pursuing more renewable energy is that the low costs of wind and solar energy have continued to fall, opening up a huge market: replacement power for existing coal plants.
Cheap renewable energy has already meant that when utilities needed new power generation in recent years, they have mostly chosen renewable energy. Nationwide, wind and solar power represented about two-thirds of all the new electricity generation capacity that was brought online in both 2015 and 2016, according to the US Energy Information Agency.
But as the costs of building new wind and solar projects have kept dropping, renewable energy is now becoming cheaper even than continuing to run existing coal-fired power plants - as Colorado Governor John Hickenlooper recently noted, “Coal is no longer the low-cost fuel."
The impacts of corporate renewable energy goals are increasing across three major sectors of Colorado’s economy: skiing, technology, and beer.
Last month I looked at how cities in Colorado are helping push utilities in the region to embrace renewable energy. Communities like Boulder, Aspen, and Pueblo have made 100% renewable energy commitments, and the utilities that serve them are responding with plans to invest in more wind and solar power – although progress is uneven across the various utilities and electric cooperatives throughout the state.
Along with municipalities, several companies with operations in Colorado have also made 100% renewable energy commitments, and those too are getting results, as utilities respond to these major customers with new programs and plans for more clean energy.
Two key trends are boosting the impact of these corporate renewable energy commitments. First, companies are increasingly focused on adding renewable energy near their operations, instead of purchasing renewable energy credits from distant projects. And second, much larger companies have recently made 100% renewable energy commitments, which is significantly increasing the scale of renewable energy needed to meet company goals - and somewhat altering the power dynamic between utilities and their customers.
Let’s look at how these trends are playing out in three industries in Colorado: skiing, technology, and beer.
A look at two Colorado electric cooperatives navigating the implications of solar power’s declining costs
Emily Bowie at San Juan Citizens Alliance writes about how the La Plata Electric Association (LPEA) board of directors is discussing the implications of the declining costs of solar energy. Bowie describes how the “board’s touchiest topic is how the declining costs of renewable energy (and rising costs of coal) should impact LPEA’s future.”
Some board directors are concerned about how declining solar power costs could encourage more customers to install their own rooftop solar arrays, and what that might mean for the electric cooperative.
Other board members are more focused on the opportunity for LPEA to take advantage of falling solar power prices, by pursuing its own solar projects. As LPEA director Bob Lynch put it, “I want to be part of a plan that figures out how to use solar to help all our members.”
The town of Breckenridge passed a resolution last week establishing a goal to power the community with 100% renewable electricity by 2035. Breckenridge joins other Colorado towns and cities that are pursuing 100% renewable energy, including Pueblo, Boulder, and Nederland. Aspen achieved its 100% renewable energy goal in 2015, while other towns and cities including Denver and Durango are also considering renewable energy goals.
The responses from the utilities that serve those Colorado towns and cities show that these 100% renewable energy goals are helping push the region toward a cleaner electricity grid, achieving a broader impact than sustainability goals that remain within the boundaries of a municipality. That’s consistent with a new report by global management consulting firm McKinsey & Company, which argues that cities should focus their sustainability efforts on four strategic areas for maximum impact. First among those four strategic areas is using their position as major electricity consumers to help decarbonize the electricity grid:
While cities may believe they have little influence over the grid mix, in fact, they often represent a major portion of any local electric utility’s customers, potentially giving them significant leverage to shape the emissions profile of the electricity consumed within their metropolitan area. Still, capturing this opportunity will not be easy, and cities cannot do it alone. Utilities and regulators must play a central role in ensuring the overall mix of renewables is appropriately balanced at a system level and that critical components such as energy storage are in place to ensure grid reliability. Nevertheless, cities have an essential role to play by setting clear decarbonization goals, aggregating demand for renewables, promoting energy efficiency, and shifting more urban energy consumption to electricity (especially in transportation and heating).
Lowering the emissions intensity of the electricity grid is an especially impactful way that municipalities in the Rocky Mountain region can advance their sustainability goals, because the region’s grid is more dependent on coal, and therefore more carbon intensive, than other parts of the US. But as these Colorado towns and cities seek to accelerate the transition to renewable energy, they face varying challenges in working with the different utilities and electric cooperatives that sell electricity in Colorado. Colorado towns and cities are served by two investor owned utilities, 29 municipal utilities, and 22 rural electric cooperatives, according to the Colorado Energy Office
Let’s look at four Colorado municipalities pursuing renewable energy goals, each with a different electricity provider: Breckenridge, Pueblo, Aspen, and Durango.
At the recent 21st Century Energy Transitions Symposium, former Colorado Governor Bill Ritter asked the governors of Colorado, Montana, and Wyoming: How do you ensure that the residents of your state aren’t left out of the energy transition underway that Amory Lovins presented in his keynote remarks?
It was the final question that Ritter asked during the Governors’ Panel, and the only one he posed to all three members of the panel: Montana Governor Steve Bullock, Colorado Governor John Hickenlooper, and Wyoming Governor Matt Mead. Amory Lovins, chief scientist and co-founder of Rocky Mountain Institute, had earlier delivered the Symposium’s keynote address, showing that rapidly changing technologies, business models, and price trends are driving the energy transition from “the obsolete age of carbon” to “the modern age of silicon.”
It’s worth watching Amory Lovins' full presentation
Transcript of Bill Ritter’s energy transition question to the Governors of Colorado, Montana, and Wyoming
At the 2017 21st Century Energy Transitions Symposium, former Colorado Governor and Director of the Center for the New Energy Economy Bill Ritter asked the governors of Colorado, Montana, and Wyoming: How do you ensure that the residents of your state aren’t left out of the energy transition underway that Amory Lovins presented in his keynote remarks? I summarized and wrote about the governors’ responses, and how we might ask similar questions of electric cooperatives. To help provide a more complete record, I’ve also transcribed the governors’ full responses below, lightly edited for clarity. Thanks to the 21st Century Energy Transition Symposium and Colorado State University for hosting the event and providing videos of the Governors’ keynote lunch panel and all the other sessions.
Next week, United Power will switch on its biggest solar project yet. At 16 megawatts, the SR Platte solar array will produce enough electricity to power 2,700 homes, and help the electric cooperative save money on its electricity purchases.
But because of its contract with its electricity supplier, Tri-State Generation and Transmission, United Power is unlikely to build more solar arrays any time soon, so it's shifting its focus to energy storage.
Coal can't compete with cheap renewable energy
After more than a decade of efforts to dramatically expand the Sunflower Electric Power Corporation’s coal-fired power plant in Holcomb, Kansas, Tri-State Generation and Transmission Association, the principal backer, now considers it unlikely that the project will move forward.
The Holcomb coal plant expansion project received a key air permit in March, following a Kansas Supreme Court decision. As the economic reality facing the coal industry continues to make it less and less likely that new capacity will be added, Holcomb seemed to be a potential outlier; last month it was called “perhaps the most likely prospect for a major new coal plant in the United States.”
But without the support of Tri-State, a Colorado-based utility, prospects for the 895-megawatt coal unit are increasingly dim.
In an August 14 filing with the Securities and Exchange Commission, Tri-State reported that it had “assessed the probability of us entering into construction for the Holcomb Expansion as remote.” As a result, the utility reported that it had written off more than $93 million it spent trying to build the coal unit.
Plans move forward for a floating solar array in Jackson County, while Mountain Parks Electric considers its own solar projects.
In Jackson County, the town of Walden’s Board of Trustees voted unanimously this week to build a solar array that will help power the town’s water treatment plant. Jim Dustin, the Mayor of Walden, said at the Mountain Parks Electric August board meeting that the project “will be unique in Colorado – it will be a floating array.” Dustin said the cost of the 50 kilowatt solar array will be covered by lower electricity bills over the next decade or two.
At the electric cooperative’s August 10 board meeting, Mountain Parks Electric board members and staff also discussed their own solar energy efforts. Among the solar projects that Mountain Parks Electric is considering is a collaborative effort with other electric cooperatives in the region and the Rocky Mountain Institute. According to the Rocky Mountain Institute, solar developers have responded with offers that would deliver solar energy at a price of about 4.5 cents/kilowatt hour, less than the cost of electricity and transmission from coal fired power plants that participating electric cooperatives currently pay.
Co-op considers policy change that would doom Fraser solar project, others
Plans for a solar power array at the Fraser wastewater treatment plant would be derailed if the Mountain Parks Electric Board of Directors rolls back a key renewable energy policy.
During its July 13 board meeting, Mountain Parks Electric board members and staff discussed how the electric cooperative should respond to growing interest in low cost solar power from homeowners and towns in Grand County.
Mountain Parks Electric Manager of Communications & Member Relations Rob Taylor explained at the board meeting that the steep decline in solar power costs in recent years means that more Mountain Parks Electric members are now able to pursue solar projects that deliver electricity at a price that “beats all our rates, we can’t compete with that… With our rates going up and solar going down, it presents a real eye-opener for us.”
Basin Electric faces growing pressure on coal from co-ops, insurers, and banks
Tri-State: Moving a cooperative power provider from coal to clean energy
Tri-State will replace coal plants with a gigawatt of new wind and solar
United Power and La Plata Electric ask Colorado Public Utilities Commission to determine Tri-State exit fee
Colorado Rural Electric Association spent electric cooperatives’ money supporting Republican politicians
Colorado Public Utilities Commissioner questions "whether or not Tri-State has been candid with us"
Rural America could power a renewable economy - but first we need to solve coal debt
Tri-State explores FERC rate regulation to limit state oversight
Poudre Valley Electric sets "80 by 2030" carbon free goal
Guzman Energy proposal would finance retirement of Tri-State coal plants, add 1.2 gigawatts of new wind and solar power
Colorado Public Utilities Commission will oversee Tri-State resource planning
Colorado communities and state Energy Office urge Public Utilities Commission oversight of Tri-State
Reports examine the impacts of Tri-State's high wholesale power costs
Tri-State executive involved with anti-Clean Air Act group since 2005
US Congressional Committee requests details of Tri-State funding to anti-Clean Air Act group
Renewable energy projects stalled in 2018 among Tri-State member co-ops
Second co-op asks Tri-State to pull “Better Together” ads
Tri-State won’t allow co-op members to attend annual meeting
Tri-State expects member co-ops to support bylaw changes at annual meeting
Rocky Mountain Farmers Union calls on Tri-State to adopt flexible contracts and more clean energy
Co-ops in Colorado push for change at Tri-State
Will Municipal Energy Agency of Nebraska remain reliant on coal?
Tri-State ad campaign tells co-ops they’re “better together”
La Plata Electric concerned Tri-State debt will lead to higher rates
Colorado Public Utilities Commission asserts jurisdiction over Tri-State
More Colorado co-ops announce clean energy goals
Ski industry climate change efforts shift to electric utilities and their regulators
Public Utilities Commission rejects Tri-State motion to exclude Colorado Energy Office from exit charge case
Tri-State claims that co-ops "have intervened on Tri-State's behalf at the PUC” don’t add up
Colorado state legislators urge Public Utilities Commission to determine Tri-State exit charge
United Power says Tri-State policies are turning away large customers
Next PUC Commissioner John Gavan "consensus choice" of Governors Hickenlooper and Polis
Tri-State policy change discourages battery projects in rural Colorado and New Mexico
Colorado Public Utilities Commission orders Tri-State to "satisfy or answer" exit charge complaint from Delta Montrose Electric
United Power seeks solutions to "increasingly outmoded G&T business models"
Clean Energy Means Business Summit highlights renewable energy opportunities and challenges in rural Colorado
Governor-elect Jared Polis says moving Colorado toward more renewable energy will be a top priority
Electric cooperative officials discuss cheap renewable energy and an “eroding monopoly”
Delta Montrose Electric members vote for new financing options, supporting a potential buyout of Tri-State contract
Poudre Valley Electric requests Tri-State policy changes and fuel mix study
Holy Cross Energy plans to shift away from coal, aiming for 70% renewable energy
What do corporate renewable energy commitments mean for electric utilities?
Colorado Energy Plan approval will mean new renewable energy investments in rural Colorado
Report: Tri-State could save $600 million by shifting from coal to renewable energy
Delta Montrose Electric seeks new financing options to end contract with Tri-State
Wind energy jobs in rural Colorado attract bipartisan support
Colorado Energy Plan analysis shows switching from coal to renewable energy will boost jobs and local tax revenue
Poudre Valley Electric and Xcel Energy Colorado President win national awards from Smart Electric Power Alliance
Latest coal plant subsidy proposal could hit electricity bills in the West
Moody’s report: “High quality renewable resources” could help Tri-State and Basin Electric navigate rising carbon transition risks
Senator Heinrich highlights “frustrations in New Mexico” with Tri-State’s limits on local solar
Moody’s report shows Tri-State’s coal plants are more expensive than new renewable energy
Tri-State’s limits on local energy development are a growing problem for co-op members
Governor Hickenlooper discusses Tri-State at the Climate Leadership Conference
Bids for Xcel’s Colorado Energy Plan include a proposal for the world’s largest battery
New wind and solar power in Colorado is now cheaper than existing coal plants
Companies' 100% renewable energy goals are getting results in Colorado
What does cheap solar mean for electric cooperatives?
Colorado towns and cities are helping push utilities to embrace renewable energy
How are electric cooperatives navigating the transition from coal to cheap clean energy?
Blocked from building more solar projects, United Power shifts to community batteries
Economic reality sets in for Tri-State efforts to expand the Holcomb coal plant
Solar projects in the works in Grand and Jackson counties
Mountain Parks Electric grapples with solar