Every few years, Colorado utilities have to prepare a plan detailing their anticipated future electric generation sources. This Energy Resource Plan lays out a utility’s road map for how it will provide electricity in the coming years.
Tri-State Generation and Transmission, La Plata Electric Association’s current electric provider, is presently in the midst of such an Energy Resource Plan, and the Colorado Public Utility Commission is soliciting public feedback about that plan. The plan spells out what new resources will be needed to satisfy customer demand for power, aging generating capacity that will be retired, plans for meeting state climate pollution reduction goals, and needed transmission upgrades to deliver the electricity it generates.
So why would customers of La Plata Electric Association concern themselves with Tri-State’s future energy mix, since next year LPEA is exiting its long-term 25-year contract with Tri-State? Because LPEA will still be purchasing some power from Tri-State under revised, short-term contracts and LPEA members might well be interested to know how that power is generated.
LPEA has agreed to contracts with Tri-State to take power from the new Dolores Canyon solar project and from other baseload Tri-State generation sources. LPEA will shed the restrictive straitjacket of its previous contract requiring it to purchase essentially all of its power from Tri-State at whatever rates Tri-State sets for the next 25 years, and instead will replace those with voluntary purchases in the competitive marketplace at reduced rates. But what will be the future makeup of these remaining Tri-State power sources?
That’s the question Colorado Public Utility Commissioners will entertain. Tri-State has moved toward cheaper, renewable sources while reducing its greenhouse gas emissions, and its coal plants in Craig will be retired over the next five years. Tri-State’s customer base has shrunk by about 25% with the departures of some of its member cooperatives. It’s also depending upon about $2.5 billion in financial support under the Inflation Reduction Act that is at risk from Elon Musk’s cost-cutting initiatives.
The Electric Resource Plan’s first phase considers possible pathways for how the utility will meet demand over the next 5-10 years and develops a “menu” of resources. One of the menu items Tri-State is considering is a significant build-out of new natural gas generating capacity – up to 290 MW.
It makes better sense to avoid more investments in fossil fuel sources like natural gas. For communities already facing the direct impacts of climate change with decreased snowpacks, reduced water supplies and increased wildfire risks, we should continue to focus on cutting greenhouse gas emissions and accelerating the pathway to a fully clean energy economy.
Expanding generation from natural gas is financially risky. Natural gas is subject to volatile swings in market pricing, especially during severe weather events. The plants are often only used to meet peak demand, which could saddle co-op members with huge costs for many years.
After it exits Tri-State, LPEA will have the benefit to shop around in the energy marketplace, and find the best competitive deals in future years. Hence if Tri-State opts for expensive natural gas generation, LPEA members can choose cheaper alternatives. But remaining Tri-State co-op members, like those with neighboring Empire Electric, could be stuck with outsized costs through the remaining decades of their restrictive contract.
It can be a bit intimidating to wade into the Colorado PUC’s process, but perspectives from the end-use customers of Tri-State’s power is valuable to commissioners. To offer comments about Tri-State’s energy plan, send an email to dora_puc_website@state.co.us, with “Docket No. 23A-0585E” in the subject line.
Mark Pearson is Executive Director at San Juan Citizens Alliance. Reach him at mark@sanjuancitizens.org.
