Colorado Public Utilities Commission asserts jurisdiction over Tri-State

Delta-Montrose Electric highlights "broad statewide support" from state legislators, industry trade associations, Colorado towns and cities, and advocacy organizations

By Joe Smyth | joe@cleancooperative.com | @joesmyth

The Colorado Public Utilities Commission (PUC) ruled on Thursday that it has jurisdiction to determine how much Delta-Montrose Electric should pay to end its contract with Tri-State Generation and Transmission Association. The PUC ruling is a boost to the electric cooperative's years-long efforts to pursue more local renewable energy projects and try to stabilize electric rates for its members.

Delta-Montrose Electric CEO Jasen Bronec said in a press release:

“This is a significant ruling and confirms that no wholesale electricity supplier—not even Tri-State—is above the law. Tri-State talks about its ‘core principle’ of ‘voluntary and open membership’ in public. But its legal filings say that the Tri-State board can stop members from exiting by setting abusive charges with zero oversight."

In a press release, Tri-State Board President Rick Gordon made clear that Tri-State would continue to push for the case to be heard in court, instead of at the PUC:
​
“The commission’s assertion of jurisdiction is unnecessary and unwarranted, but is not unexpected. A private contract dispute, even between utilities, does not belong at the commission. This matter appropriately belongs in the courts.”

Delta-Montrose Electric highlights "broad statewide support"
In its press release, Delta-Montrose Electric highlighted that it had received "broad statewide support, with key entities, elected officials and stakeholders supporting the PUC’s jurisdiction over Tri-State." Tri-State dismissed that as "political pressure on the commission from elected officials and special interests."

But whether it's seen as "broad statewide support" or "political pressure," the diverse array of support for Delta-Montrose Electric highlights how Tri-State has struggled to gain allies in this dispute.

The Colorado Energy Office intervened in the case to “further its mandate of "lower[ing] long term consumer costs" for Colorado customers of DMEA and of the other members of Tri-State.” Tri-State opposed the Colorado Energy Office request to intervene, but the PUC rejected Tri-State's arguments, because the state agency can “intervene as a matter of right” under Colorado law. In an interview with S&P Global this week, Colorado Energy Office executive director Will Toor explained that "there are an important set of issues that are raised in the Delta-Montrose case, and we think it's important that our rural electric utilities have the ability to access renewable energy."

Last month, 52 Colorado state legislators urged the PUC "to set a just, reasonable, and nondiscriminatory charge for DMEA’s exit from Tri-State." Tri-State responded with its own letter to state legislators, urging them to "reach out to us" next time on issues affecting electric cooperatives. But Tri-State's letter didn't seem to get the desired response. The following week, ten more state legislators joined the call to urge the PUC to set a fair exit charge, bringing the total to 20 state senators and 42 state representatives.

Some Republican state legislators signed that letter to the PUC, including State Senator Don Coram, who represents Delta-Montrose Electric members and others in southwest Colorado. He told the Colorado Sun:

“I don’t think Tri-State has been a good neighbor. We’ve tried to talk to Tri-State about renewable energy. We’ve got great resources in our region. DMEA could do 30 to 40% renewables. It is a question of jobs for my community, so it is time for an equitable divorce.”

Delta-Montrose Electric also attracted support from Coalition of Ratepayers, the energy policy affiliate of the libertarian Independence Institute, which called Tri-State's actions "discriminatory as well as predatory."

Several environmental advocacy and community organizations joined in support of Delta-Montrose Electric, including San Juan Citizens Alliance, Western Resource Advocates, Southwest Energy Efficiency Project, VoteSolar, WildEarth Guardians, and the Sierra Club.

Colorado municipalities also wrote to the Colorado PUC in support of Delta-Montrose Electric, including Durango and Colorado Communities for Climate Action, a coalition of 24 Colorado towns, cities, and counties including towns and counties in western Colorado such as Crested Butte, Telluride, and Pitkin, Eagle, and San Miguel Counties, as well as cities on the Front Range like Boulder, Fort Collins, and Westminster, where Tri-State is headquartered.

Industry trade associations supported Delta-Montrose Electric as well, including the Colorado Solar Energy Industries Association, and Colorado Ski Country USA, which represents 23 member ski resorts including 16 that buy electricity from electric cooperatives.

For its part, Tri-State pointed to support from many of its member co-ops, and a Tri-State spokesperson told the Denver Post, and the Grand Junction Daily Sentinel that 34 co-ops had "intervened on Tri-State's behalf” at the PUC. But a review of the co-ops' filings and requests for comment showed that Tri-State's claims don't add up. More recent media coverage reduced that figure to 26 co-ops supporting Tri-State, mostly from Wyoming, New Mexico, and Nebraska.

Moreover, two of Tri-State's largest member co-ops sided with Delta-Montrose Electric. In a joint filing, United Power and La Plata Electric Association explained that "if they someday find themselves in the same position as DMEA, Tri-State will hold hundreds of thousands of Amici’s rural Colorado members hostage through unreasonable exit charges."

The PUC decision this week means that case will now head to hearings June 17-21, as well as testimony from the parties this spring.

Further reading:

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

Colorado Public Utilities Commission orders Tri-State to "satisfy or answer" exit charge complaint from Delta Montrose Electric