PUC puts risk of coal on Idaho Power

The commission wants the utility to be able to change its mind about upgrading Wyoming coal. units.

rbarker@idahostatesman.comDecember 3, 2013 

The Idaho Public Utilities Commission said Idaho Power can improve its Wyoming coal plant, but it will have to come back and ask permission again if it wants its customers to pick up the tab.

The three-member commission did grant the utility a certificate allowing it to invest $130 million in environmental upgrades at the Jim Bridger coal plant.

But the PUC said that deciding to put the cost of the investment on ratepayers now might make it more difficult for Idaho Power to pull back later if additional federal or state emission controls make the upgrades no longer economical.

“Because of the uncertain future of coal-fired generation, we find it unreasonable to prematurely commit ratepayer dollars to support Idaho Power’s investment,” the commission wrote. Approval of such treatment would provide the company with the economic, social and political assurance it seeks for upgrading the coal plant, while leaving ratepayers to “bear the risk of environmental uncertainties.”

Idaho Power did not need the certificate, but had sought the commission’s endorsement and pre-approval for placing the costs on customers’ bills. The PUC decision to stop short of that approval pleased proponents of clean energy.

“We understand that this was not an easy decision for the commission, but it is one of its most important ones in recent years,” said Liz Woodruff, executive director at the Snake River Alliance, an energy and nuclear watchdog group.

In its order, the commission referred to Obama Administration plans to develop new rules for regulating existing greenhouse gases at power plants by 2015. “A tipping point could be reached making (coal-plant upgrades) uneconomic,” the commission said.

“It is in the best interest of the customers, the company and the company’s shareholders for Idaho Power to be continuously analyzing the impact of changing environmental regulations on its upgrade project,” the PUC wrote.

Bill Shawver, Idaho Power's corporate communications director, said the company believes the environmental upgrades are the most cost-effective option for the company and its customers.

“We certainly are analyzing and evaluating the order,” Shawver said. “We’re happy with the decision to grant the certificate.”

Idaho Power owns a third of the Wyoming Bridger plant, the largest emitter of greenhouse gases in the region. Two units that generate 351 megawatts of electricity are scheduled for upgrades.

Pacificorp is the plant’s majority owner. Utah and Wyoming already have approved Pacificorp’s requests for the upgrade, but neither state pre-approved billing customers for the costs.

The environmental upgrades are needed to comply with regional haze rules under the Clean Air Act, designed to improve visibility in national parks and wilderness areas. Those rules require controls to limit nitrogen oxide emissions by December 2015 on Jim Bridger Unit 3 and by December 2016 on Unit 4.

NO ‘REALISTIC’ ALTERNATIVES

The commission granted the certificate because opponents and the many customers who wrote and attended a Nov. 25 hearing couldn’t offer timely alternatives that could “reasonably ... replace the value of energy and capacity that Bridger provides.”

“The suggestion … that renewable resources and energy efficiency could somehow replace Bridger’s ability to reliably provide energy and capacity is simply not realistic in the near-term,” the commission wrote.

It said Idaho Power’s coal and gas plants do help integrate renewable energy and are “critical to the reliable operation of the high-voltage transmission system.”

But it also acknowledged that cleaning up the air is in the public interest: “The detrimental effects of long-term coal use on human health, the climate, wildlife, land and water are well-documented.”

Rocky Barker: 377-6484

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