The move Tuesday by Scott Pruitt, administrator of the U.S. Environmental Protection Agency, to roll back the Obama-era Clean Power Plan will have little impact in Oregon.
The Clean Power Plan aimed to reduce carbon emissions that result from burning coal to generate electricity, emissions believed to contribute to global warming. But the economics of power generation left coal behind some time ago with the availability of cheaper natural gas as a means of firing power plants. And consumer demand for and government insistence upon cleaner sources of power are pushing utilities such as PacfiCorp, the parent company of Pacific Power, which serves Central Oregon, into further investments in renewable power sources.
“It’s mostly driven by other regulatory measures, compliance with the (federal) Clean Air Act and other federal and state requirements that we have to meet for those plants,” said Scott Bolton, PacifiCorp vice president of external affairs and customer solutions.
PacifiCorp, which operates in six states, including Oregon, generates 61 percent of its electricity by burning coal. The company operates 10 coal-fired generation plants in Arizona, Colorado, Utah and Wyoming. It plans to close seven of those plants by 2037, a total of 3,650 megawatts of peak power, according to the utility’s 2017 Integrated Resource Plan, a 20-year planning document updated by the company and reviewed by the Oregon Public Utility Commission every two years. PacifiCorp, which supplies power to 574,000 customers in Oregon, has the capacity to generate a total of nearly 11,000 MW across its service area, according to the company.
Plants that burn natural gas generate 15.4 percent of PacifiCorp power, according to the company. Renewable sources provide 13.17 percent: wind generates 7.1 percent and hydropower generates 5.18 percent. Solar installations generate 0.08 percent.
Geothermal makes up the rest.
The Clean Power Plan, introduced by the Obama administration in August 2014, set targets for each state to meet in reducing carbon emissions from the burning of fossil fuels. Oregon would have met about half of its target, a reduction by 48 percent of the amount of carbon released into the atmosphere in 2005, by the scheduled closing of the Portland General Electric coal-fired plant in Boardman in 2020. The remainder was expected to be met by working with states including Wyoming — where coal is mined and burned to supply electricity beyond its borders — to reduce Oregon reliance on coal-fired electricity while also helping those states reach their targets.
More than a year before Pruitt proposed to repeal the Clean Power Plan, which he previously fought as attorney general of Oklahoma, the U.S. Supreme Court stayed the plan’s implementation while states that opposed it prepared their case at the U.S. Court of Appeals for the District of Columbia. Even then, industry sources and environmentalists agreed that the comparatively low cost of natural gas, coupled with ongoing government mandates such as those in Oregon to increase the amount of power generated by renewable sources, had overtaken the Clean Power Plan.
“Our policy has been to decarbonize as quickly as we can,” said Ry Schwark, a PacifiCorp spokesman. “The balance point is the affordable part. We’ve got to keep rates at a reasonable level.”
But the utility in April announced a plan, Energy Vision 2020, to add 1,100 MW of new wind-driven power capacity to its system, along with a 140-mile transmission line in Wyoming at a cost, with other improvements, of $3.5 billion. The company expected to take advantage of federal tax credits that expire before 2020 and complete the work at reduced cost.
A staff review of the project, however, found fault with the plan. PacifiCorp’s own analysis “indicates marginal customer benefits” based on assumptions the company made about the cost to generate power and the regulatory environment, according to staff comments in August. In the final comments issued Oct. 6, the Oregon PUC staff wrote: “We cannot conclude anything other than that (PacifiCorp) has failed to demonstrate there is a need for these large capital investments, which is a prerequisite to compelling customers to take on the risk associated with utility investment.”
In other words, the PUC staff concluded that the utility went outside the typical cost-benefit analyses to justify the cost to add more wind power to its mix, a cost that could eventually be paid by consumers. PUC staff recommended the commission not “acknowledge” those costs, meaning PacifiCorp could not pass them onto consumers.
The critique marks a turning point, a departure from previous staff analyses of PacifiCorp long-range plans that focused on the utility’s plans to downsize its fleet of coal-burning plants. But the staffers who critiqued Energy Vision 2020 underlined that their analysis was not a turnabout on renewable energy.
“Such an interpretation would be incorrect and misunderstands the (Integrated Resource Plan) as a tool,” they wrote. “In fact, staff generally assumes that most utility resource acquisition in Oregon going forward will be some sort of renewable energy.”
PacifiCorp, consumer advocates and conservationists find themselves on the same side of the discussion. A future that includes an increasing amount of renewable energy has rendered the Clean Power Plan mostly obsolete.
“The Clean Power Plan as enacted wouldn’t have had a terribly significant impact on Oregon,” said April Thomas, of Oakland, California, deputy press secretary for the Sierra Club Beyond Coal program. “It’s not so much of a blow (to repeal the plan), but nationally it’s not a great idea to have an EPA that exists to undermine the mission. At the same time, the market is driving so much of the transition from fossil fuels to clean energy. Ten coal plants have closed since Trump became president. You don’t hear much about that.”
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