Tri-State, a Westminster-based electric power cooperative whose members have pushed for more use of renewable energy sources, could save more than $600 million through 2030 if it did just that, a new report says.
Declining costs of wind and solar power give Tri-State Generation and Transmission an opportunity to cut costs for its members and blunt the expense of reducing emissions from coal-fired power plants, according to the study released Thursday by the Rocky Mountain Institute, an independent think tank and research organization that focuses on ways to make the transition from fossil fuels to renewable energy.
“What we have done is look at an interesting case study in an interesting part of the country. It’s not an attempt to make concrete suggestions,” said Mark Dyson, a principal at the institute and a co-author of “A Low-Cost Energy Future for Western Cooperatives.”
Tri-State’s response to the report was twofold: It invited the Rocky Mountain Institute to its 2019 resource planning the process and released a statement criticizing the report, saying it does not have “the detailed inputs, complex models and technical expertise necessary to forecast the association’s future costs” across 43 member distribution systems in four states.
“The RMI report does not equate to the thorough resource modeling in our integrated resource planning,” spokesman Lee Boughey said. “We encourage RMI to suggest scenarios and engage in our inclusive public process next year.”
Tri-State was among the first generation and transmission cooperatives to support local renewable energy development, Boughey said in an email. Currently, 22 of Tri-State’s 43 member associations “have about 140 megawatts of local renewable energy projects in place or under development,” he added.
Thirty percent of Tri-State’s power comes from renewable sources and the total is expected to increase to a third this year. Boughey said the cooperative has requests out for additional renewable sources.
Xcel Energy Colorado, the state’s largest electric utility, gets 23 percent of its power from wind and 5 percent from other renewable sources. Its use of coal has dropped to 44 percent and a plan filed with the state Public Utilities Commission would cut it to 24 percent by 2026 and significantly boost wind and solar.
Tri-State, which supplies electricity to associations in New Mexico, Nebraska and Wyoming, gets about half of its power from coal-fired plants. The Rocky Mountain Institute’s report says only one of the five coal-fired plants used by Tri-State and studied by the institute is more economical than the current costs of wind and solar power.
Tri-State’s production costs are generally higher than bids for wind — $11 to $18 per megawatt hour — and comparable to solar bids — $23 to $27 per megawatt hour, according to the report. Dyson said the figures factor in transmission expenses.
“Even if they don’t shut down coal plants, they can still save money by not running coal-fired facilities as much and just buying renewables in this region,” Dyson said.
Tri-State said it has closed one coal plant and plans to shutter Nucla Station by the end of 2022 and Craig Station Unit 1 will close by the end of 2025. Those plants are in Western Colorado.
The Durango-based La Plata Electric Association is one of Tri-State’s members that wants to see less coal and more renewable energy in the mix.
“‘What we’re seeing at La Plata is that the prices of renewables are declining. We want to see more of a renewable mix in the energy supply,” said Mike Dreyspring, the association’s CEO. “It’s as much about the economics as anything.”
The La Plata Electric Association draws on a mix of renewable sources for the 5 percent of its supply that members are allowed to generate on their own. Dreyspring said Tri-State officials planned to meet in Denver on Thursday to discuss boosting the use of renewable energy sources.
While supporting the expansion of renewable energy sources, Dreyspring stressed the association wants to ensure that base supply of power remains adequate to meet people’s needs.
Dyson said utilities that are relying less on coal are managing to keep the lights on for customers. A portfolio of resources precludes the need to have any one power plant running all the time, he added.
The report’s authors believe that switching to less expensive renewable energy sources will result in enough savings to cover outstanding costs associated with plants that might be idled. Costs of complying with regulations to reduce emissions from coal-fired power plants play into the calculations. Dyson said any changes based on whether the restrictions in the federal Clean Power Plan are rolled back would depend on the details of the new rule, but added that the report took a a conservative approach to figuring the costs of compliance.
The Environmental Protection Agency on Tuesday released a proposal that would replace the Obama-era rule that requires cutting U.S. carbon dioxide emissions to 32 percent below 2005 levels by 2030. The proposal would scrap that and empower states to make their own plans, including setting their own emission-reduction targets.