Rocky Barker: Idaho Power decision is about when the end begins

Idaho StatesmanDecember 2, 2013 

A coal-fired power plant in Holcomb, Kan., in 2007.

CHARLIE RIEDEL, FILE — Associated Press

During the 20th century, Idaho Power and the federal government invested billions of dollars to build the hydroelectric system that drove the Pacific Northwest’s economy into the 21st century.

They allowed Idaho farmers to turn the desert into a garden, helped J.R. Simplot and others create a world-class food-processing industry and made it possible for companies such as Micron Technology to build a foundation for the state’s entry into the digital frontier.

When the sites for new large hydroelectric dams were all filled, the Northwest prepared for the next shift. Utilities then assumed that energy use would grow 7 percent a year, an estimate driven in part by the region’s amazingly low cost.

The Bonneville Power Administration’s customers — public, municipal and cooperative utilities — decided to invest in five nuclear power plants to meet that next wave. The energy crisis in the 1970s reduced demand, and in 1983, the utilities defaulted on the debt, causing many bondholders to take deep losses and putting a debt on BPA customers of billions of dollars.

Only one of those nuclear plants, near Richland, Wash., continues to operate.

Idaho Power chose to fill the gap with coal, but many of its customers and conservationists were skeptical about building a 1,000-megawatt coal plant between Mountain Home and Boise. The Idaho Public Utilities Commission killed it in 1976, preventing the utility from following the rest of the region’s painful overbuilding.

Instead, Idaho Power joined other utilities building coal plants in Wyoming, Nevada and Oregon and skillfully used power purchased on the energy market to leverage its low-cost hydro. This stretched the era of “cheap power” into the 2000s.

That period is over. Any new energy source will cost largely the same for Idahoans as it does for any other customer on the world market.

Idaho will still be able to build on its past investments with energy efficiency, but we must now make a transition again. Today, we are moving to a digitally managed system that will be driven as much by demand as by supply. Idaho Power, with its “smart grid” technology, is poised for this. Finding new technology to store energy produced by alternative sources will help make this happen more quickly.

Lisa Grow, senior vice president of power supply, presented a vision of the company through this transition as she defended to the PUC the company’s plan to spend millions to keep its largest coal plant operating. More than 100 customers went to the Nov. 25 PUC hearing to oppose the plan. Idaho Conservation League energy attorney Ben Otto said it would be better for customers to pay off the remaining debt in the coal plants than add to it.

Both Grow and Otto can pull from Idaho Power’s past to make their cases. Otto can point to the upfront investments Idaho Power made in the Hells Canyon dam complex in the 1950s and 1960s as a prime example of knowing when it’s time to spend money on new technology. Grow can point to the way the utility has kept that investment working for customers.

When you see them speak, you know they are both committed to their visions. And they aren’t really that far apart.

We might hear soon what energy regulators think about the coal proposal. The Oregon Public Utilities Commission will hold a technical hearing Monday on Idaho Power’s long-term Integrated Resource Plan. And the Idaho PUC decision on the request for ratepayers to cover the costs of the environmental upgrade to its Wyoming coal plant could come this week.

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