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Call for major investment in renewable energy worries Montana utilities
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Call for major investment in renewable energy worries Montana utilities

The latest roadmap for the region’s energy future is big on renewables and confident that coal-fired power plant retirements won’t lead to blackouts. Both assumptions had Montana utilities concerned this week.

The Northwest Power Plan is probably most often cited in Montana for its blackout forecasts, which in the past suggested that coal-fired power plant retirements increased the probability that Montana and northwestern states could be short on power during times of peak demand.

But a draft of the latest plan makes a sharp pivot toward renewables, suggesting that in the next six years at least 3,500 megawatts of renewable resources should be built. The nameplate capacity is the equivalent of roughly two-and-a-half Colstrips. The southeast Montana power plant, once one of the West’s largest, helped electrify Idaho, Montana, Oregon and Washington for 40 years, but now faces retirement as early as 2025 and isn’t the only coal plant in the region winding down. Five coal-fired units totaling 2,324 megawatts have retired in the last three years. Eight regional coal-fired units could retire by the end of 2026.

“Things have been changing quite substantially over the last few years. One, there's been a lot of different clean energy policy and decarbonization goals that have happened across the entire West that have been adopted by different states, utilities, or municipalities,” said Ben Kujala, director of power planning at the Northwest Power and Conservation Council.

The Council is a four-state northwest organization that does long-range regional power planning that not only focuses on the energy needs of states, including Montana, but also the conservation of the Columbia River drainage. Council members are appointed by the region's state governors. Kujala was addressing an audience of Montana utilities and electric cooperatives last week.

“We certainly have been watching very closely and looking at the many core units are retiring throughout the entire western region. And there's also been a substantial decline in the cost of solar (photovoltaics) and wind resource options,” Kujala said. “So, we've seen technologies used to generate power really changing, and also how much they cost.”

Montana was the first stop for the Council’s public hearings on the draft power plan.

A new construction wave of Montana renewable energy projects has already started. PacifiCorp, a Colstrip Power Plant owner and one of the largest utilities in the West, completed a 250-megawatt Pryor Mountain Wind Farm near Bridger in 2020. A $406 million project, Pryor Mountain was part of a $3.1 billion wind farm and transmission investment. Pryor Mountain is the largest wind farm in Montana, for now.

NextEra started construction this year on a 750-megawatt, southeast Montana wind farm that includes portions of three counties. The Clearwater Wind Farm, less than an hour's drive from Colstrip, locked in its first customer in January when Puget Sound Energy, a Colstrip owner, agreed to reserve half the wind farm's capacity.

Both the Pryor Mountain and Clearwater projects will keep Montana exporting energy for a few decades, contrary to forecasts by fossil fuel advocates that Montana's energy exports are fading with coal power. 

Montana's largest solar farm, an 1,100-acre generating project near Baker, secured a contract in June 2020 between developer Clénera Renewable Energy and Basin Electric, a cooperative of electric cooperatives that supply 400,000 Montanans with power. The Cabin Creek Solar Project is 150 megawatts in capacity. Construction is expected to begin in 2022. Cabin Creek will export power, as well, according to Basin.

NorthWestern Energy, the largest monopoly utiliity in Montana, has agreements with solar farms that used the Public Utility Regulatory Policies Act, or PURPA, to secure contracts. For the last 40 years, PURPA has required states to set prices and contract lengths to help the development of alternative energy projects. In 2018, NorthWestern also signed a power purchase agreement with Allete Clean Energy, which built an 80-megawatt wind farm near Great Falls. NorthWestern is also building a 175-megawatt gas-fired power plant in Laurel. 

Managing the region’s electricity load, given that renewables don’t generate electricity around the clock, will take a different approach. There will be times during the day when renewable energy will be so abundant and so cheaply priced that it won’t be profitable for fossil-fuel power plants to operate. But at other times in the day when renewable generation fades, there will be a need for fossil fuel power plants and the region's hydroelectric dams. Hydropower from the upper reaches of the Columbia River drainage in Montana all the way down to the Oregon Coast is the most dominant energy source in the region.

The network from which the region draws power will have to expand, with as many as 14 states and Canadian provinces contributing power that may be in surplus at times, but not available at others. Earlier this year, Kujala told Lee Montana that we already see this exchange when excess solar energy in California, and even parts of southern Idaho, is sold into the Pacific Northwest at a low price.

Montana electricity providers meeting remotely with the council raised several concerns. NorthWestern Energy economist Ben Fitch-Fleischmann described the utility as heavily dependent on market power and therefore more exposed to market prices, while also being a small-time utility.

“A lot of people think of us as a big utility because geographically we're quite large, but we wind up with more poles than customers, and that means a lot when you're thinking about cost recovery of fixed versus variable costs,” Fitch-Fleischmann said.

“We're short in the sense that as a percentage of our energy and capacity needs, we rely very heavily on markets more so than most in the region and that means we're exposed to the financial and reliability consequences of that, for better or for worse.

"During a record-breaking summer of high temperatures and drought, there were times when half of NorthWestern’s power was imported from off its system. Those were peak demand times for power regionally, which means the price was higher than average.”

The plan’s forecast that the likelihood for an energy shortage is low over the next 20 years has NorthWestern scratching its head, Fitch-Fleischmann said, and deserves scrutiny.

NorthWestern is adding fossil fuel generation to its portfolio with no plan to cut carbon emissions before the 2040s.

Montana electric cooperatives expressed concern about dams on the lower Snake River being breached for the benefit of salmon. U.S. Republican Rep. Mike Simpson, of Idaho, startled the northwest energy world last spring when he suggested breaching four dams on the lower Snake River. In return for tearing the dams down, environmental lawsuits over their effect on the major fishery would end.

“We need to save the Lower Snake River dams,” said Bob Popham, of Ravalli Electric Cooperative. “The second thing that they look at when they look at the trustees is reliability. We need power to be available when it's needed, not just a nameplate but we have to have it there when it's needed, solar and wind are very intermittent, and we need firm power.”

The Northwest Power Plan clarifies that currently there is no plan for removing hydroelectric dams on the Lower Snake River or the Columbia. Because there is no plan, there is no modeling necessary for how to respond to dam removal. Most of the energy players in Idaho, Montana, Oregon, and Washington oppose dam removal.

Diana Manetta, the energy conservation and sustainability coordinator for Missoula County, said her community was grateful the draft Northwest Power Plan considered the impacts of climate change. Missoula County and the City of Missoula, along with the cities of Bozeman and Helena, have clean energy plans to reduce the amount of carbon pollution in their power.

What the plan needs, Manetta said, is more attention to energy storage to extend the availability of renewable power. Conservation, she said, which has played a bigger role in previous plans, needs more attention in this one.

“We would urge the inclusion in the plan to have more demand response load flexibility and energy storage, since these are clean resources that have huge potential to cost effectively help integrate higher levels of intermittent renewables like solar and wind,” Manetta said.

In the past, energy efficiency efforts have saved utility customers billions of dollars in the Pacific Northwest. The draft plan suggests the rate of return on consumer conservation might not be what it once was.

However, Diego Rivas, of the Northwest Energy Coalition, said this wasn’t the time to cut back on the conservation efforts that had been so beneficial.

“Slashing efficiency now is like benching your Hall of Fame player in the last week of the season because computer analytics tell you that a righty-lefty matchup is better than a righty-righty one,” Rivas said. “If it's me, I’m going with the hitter that's hitting .300 with 35 home runs and 100 RBIs. I don't care which hand he hits with on top of the bat, and that Hall of Famer is energy efficiency.”

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