Earlier this month, Gov. Kate Brown
signed a landmark bill making Oregon the first state in the country to cut ties with coal-fired
power.
The new law requires that Portland General
Electric (PGE) and Pacific Power — who together serve 70 percent of the
state’s electricity needs — phase out coal-fired power by 2030 and
serve half their customers’ demand with renewable energy by 2040.
Though environmental
advocates — and everyone’s favorite Oscar winner — laud the new
law as a forward-thinking compromise from a group of unlikely
bedfellows, others have expressed concerns about the costs and efficacy of
the legislation.
During last month’s Legislative
session, Susan Ackerman, a gubernatorial appointee who chairs the Public
Utilities Commission, called the provision to ban coal by 2030 “both
costly and ineffectual,” adding that it would raise customer rates without
actually reducing carbon outputs or changing the way coal plants operate. She
also expressed concerns about the bill’s provision to expand the
state’s renewable portfolio standard.
On Friday, Ackerman effectively resigned from her position with
the PUC.
Political nitty-gritty aside, the bill
is now a fact of law. And to find out how it’s going to be implemented —
and what it might cost — we invited Steve Corson from PGE and Scott Bolton
with Pacific Power on to Think Out Loud.
Here are a few of the
things we learned.
We’re All Connected
If you live in the United States, your home
is powered by one of three interconnected electric grids. There’s everything
west of the Dakotas (that’s the Western Interconnect), everything East of
the Dakotas (the Eastern Interconnect) — and then there’s Texas, which has it’s
own grid (named, you guessed it, the Texas Interconnect).
Oregon is part of
the Western Interconnect.
PGE serves customers exclusively in
Oregon, while PacifiCorp, Pacific Power’s parent company, serves ratepayers
across six western states. Under the new law, PGE must divest from coal
entirely, while PacifiCorp can continue to own and operate coal plants so long
as coal-related costs are redirected to ratepayers outside of Oregon.
It’s A Constant Balancing Act
PGE and PacifiCorp are responsible for
ensuring they’re putting as much energy onto the Western
Interconnect as their ratepayers are consuming, but that energy
doesn’t have to be produced in Oregon. It can come from anywhere on the grid.
To measure and move power, utilities
companies rely on complex algorithms that can analyze how much energy
ratepayers are consuming and source the lowest-cost energy available to meet
that demand.
So if the wind is blowing hard at a
PGE-owned wind farm in the Gorge, the company might use wind energy to
meet ratepayer’s needs. When the wind dies down, they’ll
turn elsewhere.
You Can’t Stop Coal At The Border
Once power is on the grid, electrons
follow a path of least resistance, and there’s no way to tell the
difference between an electron that was generated by coal and another that
comes from, say, solar energy.
That means that while utilities
providers can control how they produce power, they can’t control
where it’s actually routed. So under the new law, Oregonians will
still be importing coal-fired energy — they’ll just be paying renewable rates.
What’s The Damage?
Everyone agrees utility rates will rise,
but estimates of rate hikes vary. PacifiCorp’s models project
ratepayer costs will increase about 1 percent per year under the new law.
PGE puts their number closer to 1.5 percent. And Republican state Sen. Ted
Ferrioli (R-John Day), one of the bill’s most outspoken opponents, stated
that the move will cost ratepayers $190 more each year until 2040.
None of these figures can claim to be
totally accurate. That’s because analyses are projecting so far into the
future that it’s impossible to know how much coal, natural gas and renewable
technologies might actually cost. But utilities providers say that getting
off of coal and investing in renewable resources will pay off in the
long run.
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