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Our View: Power negotiations

Tri-State flexibility a step forward for La Plata Electric Association

La Plata Electric Association board members – some more than others, have worked for a decade to free the cooperative from a Tri-State Generation and Transmission contract that limits alternatively sourced and ideally renewable energy to 5% of its needs. Negotiated at a time when coal-fired plants were predominant and were an expensive commitment, Tri-State’s lenders had understandably wanted to be certain there was a home for all its power. Thus, a lengthy contract.

Some members of the board have been more eager than others about reducing Tri-State‘s provider role, largely because of wariness over reliability and costs that could result from doing business with an unknown power source. Some talked about a full exit from Tri-State, a few others wanted no change to the status quo.

Pushed by LPEA and several other co-ops, early this year Tri-State finally came up with buy-out amounts. They were astronomical, and there were questions about methodology.

The no-more-Tri-State contingent was frustrated and angry.

Likely in order to take a step toward meeting the unceasing demands of a few of its 42 co-op members for more local power decision-making, last spring Tri-State made 300 megawatts of power available for that purpose. Request the amount you’d like, Tri-State said.

LPEA asked for 71 megawatts, which with its 5% would equal approximately 50% of the co-op’s annual power needs. Of other co-ops, only a few made their requests.

The 71 megawatts, or whatever is finally agreed on, will come at a cost. That reduction in Tri-State service is considered a partial buyout, and –, back to the expensive coal plants – other co-ops should not have to be burdened by the cost of LPEA’s partial usage reductions.

Although Tri-State responded reluctantly to LPEA’s early buy-out amount requests, and the amount was high, the feeling by LPEA leadership now is that something acceptable to both parties in regards to the 71 megawatts can be arrived at.

Last summer, LPEA worked to identify the non-Tri State, more green, less expensive (and still reliable) provider and believes it has one. Negotiations continue.

LPEA has scheduled two informational sessions, on-line, to describe recent events, describe the future and to take questions. They will take place at 6 p.m. on the evenings of Oct. 25 and 27.

At those sessions, members should be able to gauge the merits of partially leaving Tri-State, particularly what that will cost. Will the savings from buying non-Tri-State power equal some or all of the partial buyout expense and be greener as well? And as reliable?

If all can fall into place, having the flexibility to acquire desired power outside of Tri-State will be a significant step forward for the La Plata Electric Association. We look forward to the meetings near the end of the month.