Skip to content

Beneficial Electrification

By Kent Singer

The electric industry is a complicated business and the vocabulary that we use to talk about it is full of mysterious acronyms, perplexing jargon and complex terminology. NERC, FERC, RTOs, ISOs, energy, capacity, kilowatts, megawatts, gigawatts — it’s been said that to understand the industry, you have to learn a second language.

To make things more complicated, yet another new term has been added to the electric utility lexicon in the last couple of years: beneficial electrification.

For those of us involved in the electric co-op program, the term “beneficial electrification,” at first blush, doesn’t make a lot of sense. We all know that there was a time when the farms and ranches of rural Colorado did not have access to the life-changing commodity that is electric power. Before electric co-ops were founded in the late 1930s and early 1940s, although cities were electrified, much of rural Colorado was still literally in the dark. With the construction of rural electric systems by cooperatives, the ability to apply motive power to the many backbreaking tasks that had previously been accomplished with manual labor vastly benefited the lives of countless Coloradans.

So, it’s obvious that the “electrification” of rural Colorado was then and is today something that is “beneficial” to many people; it hardly seems necessary to modify the word “electrification” with the word “beneficial,” right?

Today, however, “beneficial electrification” has a new meaning. It refers to the use of electricity in place of other fuels (e.g., natural gas, propane, heating oil, gasoline) where the substitution of electricity will accomplish certain goals. Among these are: saving consumers money, reducing environmental impacts, creating a more robust electric grid, and improving the quality of life for communities.

One of the most important examples of beneficial electrification is the trend toward electrification in the automobile industry. Switching from the internal combustion engine to a battery-powered vehicle results in lower overall greenhouse gas emissions and lower maintenance costs. Similarly, using electricity instead of propane for space and water heating and using heat pumps to heat and cool homes may also have environmental and economic benefits. Electric co-ops are working hard to integrate all of these technologies, and more, into their fleets and service offerings.

To further the cause of beneficial electrification, CREA was one of the primary sponsors of a conference last summer in Denver called “Electrify Colorado! Beneficial Electrification in the 21st Century.” The conference focused on the benefits of using electricity and how that transition is consistent with Colorado’s evolving energy policy. Building on that experience, CREA has become a founding member of the Beneficial Electric League of Colorado and is working with other stakeholders to sponsor another conference this summer.

For the last couple of years, CREA has sent Colorado co-op linemen to Guatemala (and is sending more to Bolivia this year) to bring electricity to remote villages. While we know that this is the original meaning of the term “beneficial electrification,” we also know that programs we implement to meet the new meaning will benefit rural communities across Colorado for years to come.

Kent Singer is the executive director of the Colorado Rural Electric Association and offers a statewide perspective on issues affecting electric cooperatives. CREA is the trade association for your electric co-op, the 21 other electric co-ops in Colorado and its power supply co-op.

A Responsible Energy Plan

By Kent Singer, CREA Executive Director

In January, Tri-State Generation and Transmission Association (a member of the Colorado Rural Electric Association) announced that over the next 10 years it will retire its coal-fired power plants in Colorado and replace those sources of electricity generation with wind and solar power. By the end of 2030, Tri-State will no longer operate any coal-fired plants in Colorado, thus reducing the company’s carbon emissions from its Colorado plants by 90% and reducing carbon emissions from all electric sales in Colorado by 70%. (Tri-State will continue to import some coal-fired power from sources outside of Colorado.)

This is an historic decision by Tri-State, which provides wholesale power supply to every Colorado electric distribution co-op except Grand Valley Power, Yampa Valley Electric Association, Holy Cross Energy and Intermountain Rural Electric Association. Along with the announcement of the coal plant retirements, Tri-State announced the addition of nearly 1 gigawatt (1,000 megawatts) of new renewable energy capacity to its generation resources. These new wind and solar projects will be located across Colorado, creating temporary construction jobs as well as permanent maintenance positions. After its Responsible Energy Plan is completed, Tri-State will have more than 2,000 megawatts of renewable energy capacity on its 3,000 megawatt system.

Tri-State’s new direction regarding its power portfolio is driven by several factors. In 2019, the Colorado General Assembly adopted legislation (H.B. 19-1261) that requires significant reductions of greenhouse gas emissions from all industries operating in the state. Although the rules for the implementation of this legislation have not been finalized, it’s clear that electric utilities will be required to reduce their reliance on fossil fuels in the near future. Tri-State’s need to comply with the Colorado law is an important factor in its recent announcements.

But even absent a legislative mandate, the rapidly decreasing costs of renewable energy make those resources more attractive today than they were just a few short years ago. You may recall that, in 2013, Tri-State, along with CREA, opposed Senate Bill 13-252 that increased the renewable energy requirements for Colorado’s electric co-ops. As recently as seven years ago, the cost of renewable energy was significantly higher than it is today and, at that time, we were concerned that a requirement for more renewables would increase rates to co-op consumer-members. With improved technology and economies of scale, wind and solar generating plants today can provide cost-effective energy while at the same time reducing carbon emissions.

Perhaps the most important driver in Tri-State’s course change, however, is the desire by many of Tri-State’s members for the co-op to diversify its power supply and include more renewable energy. Tri-State is owned by its 43 distribution co-op and public power district members who are in turn owned by their consumer-members. One of the key principles of the cooperative business model is “democratic member control” and that means the members at the end of the line have input into Tri-State’s resource decisions. In making these adjustments to its power supply portfolio, Tri-State is also honoring this core co-op principle.

This new path for Tri-State does not come without challenges. On the operations side, Tri-State will have to figure out how to best balance its members’ power needs with an ever-increasing array of intermittent generating resources. This may require the deployment of new technologies and operating procedures in order for Tri-State to maintain the same level of reliable power supply that Colorado’s electric co-ops have enjoyed for decades.

More important than the reliability challenges, however, is the impact of Tri-State’s new direction on current Tri-State employees. Several hundred men and women who currently work at the Tri-State coal plants and coal mines that are being retired will be affected by this decision. These are folks who, in many cases, have spent their careers and much of their adult lives serving you, the citizens of rural Colorado. They have done this difficult and sometimes dangerous work so you could have light and power. They did it without asking for recognition or praise, but simply for the satisfaction of helping their communities. They deserve to be thanked and supported in this time of transition.

Colorado Needs a Robust Electricity Market

By Kent Singer, Executive Director

In most parts of the United States, regional transmission organizations (RTOs) or independent system operators (ISOs) oversee the regional transmission system and operate wholesale electricity markets. These nonprofit entities determine power requirements, on a day-to-day and hour-to-hour basis, and dispatch power from the most efficient units. They also set transmission rates across lines owned by multiple utilities and plan the regional transmission system.

These companies, such as the Southwest Power Pool, the Mid-Continent Independent System Operator and the California Independent System Operator, were created by groups of electric utilities in the various regions of the country to reduce costs to consumers by maximizing the efficiencies that can be achieved with multiple sources of power generation and transmission capacity. They also enable utilities to incorporate more renewable energy into their power supply mix by providing a system where the resources of one utility or power marketer are more easily accessed by another utility.

Colorado’s electric utilities, including the electric co-ops, do not operate within the boundaries of an RTO or ISO, although co-op power supplier Tri-State Generation and Transmission Association operates within an RTO outside of Colorado. For a variety of reasons, Colorado and its neighboring states have not created a regional electricity market despite the benefits that could be realized by electricity consumers. The largest electric utilities in Colorado worked together for several years, and it appeared that an RTO would be expanded to include Colorado, but ultimately the effort failed when one large utility pulled out.

Currently, the Colorado Public Utilities Commission is soliciting comments in a proceeding that stems from the passage of S.B. 19-236 during last year’s legislative session. One provision of that bill, the “Colorado Transmission Coordination Act,” required the commission to initiate an investigation into the merits of an RTO or ISO and report back to the legislature.

Many parties, including several electric co-ops and the Colorado Rural Electric Association, filed comments in that proceeding in favor of the creation of an RTO that would include Colorado’s electric utilities. Reasons given for supporting a regional market include greater access to lower cost resources; the elimination of transmission “pancaking” costs; and opportunities for the integration of additional renewable generation. In this proceeding, there is near-unanimous support by electric utilities, environmental groups and other stakeholders for the creation of an RTO.

While the discussion of this issue by the Colorado PUC is important, the Colorado legislature should also weigh in and pass legislation that would move Colorado electric utilities toward an RTO in a more expedited manner. Other states have passed similar legislation to spur the move toward an organized electricity market, and the Colorado General Assembly should follow their lead.

Of course, there are costs associated with the creation of a new RTO or expansion of an existing RTO that has to hire employees and incur other expenses so it can provide service to Colorado electric utilities. In the other parts of the country where RTOs have been established, these costs have been outweighed by the savings that are possible with a more efficient dispatch of generation and transmission resources.

With the adoption of H.B. 19-1261 last year, the Colorado legislature established aggressive requirements for electric utilities to significantly reduce their carbon emissions over a short period of time. A regional electricity market is a necessary tool to enable utilities, including electric co-ops, to reach those goals. We urge the Colorado legislature to act this year to help establish an RTO for Colorado electric utilities.

Kent Singer is the executive director of the Colorado Rural Electric Association and offers a statewide perspective on issues affecting electric cooperatives. CREA is the trade association for your electric co-op, the 21 other electric co-ops in Colorado and its power supply co-op.

The 2020 Legislative Session

By Kent Singer, CREA Executive Director

The second regular session of the 72nd Colorado General Assembly convenes January 8 and the Colorado Rural Electric Association will once again be actively engaged, protecting the interests Colorado’s electric co-ops. During the next four months, CREA staff and contract lobbyists will closely monitor the work of the legislature and interact with all 100 legislators to promote a better understanding of the electric co-op program.

During the 2020 legislative session, CREA plans to sponsor three bills to address issues of importance to Colorado’s electric co-ops.

First, we are working with House Speaker K.C. Becker (D-Boulder) on a bill relating to electric co-op governance. Under current Colorado law, consumer-members of electric co-ops may only vote for candidates for the co-op board of directors by mail or in person at the annual meeting. We are sponsoring a bill that will authorize (but not require) co-ops to allow their consumer-members to vote by electronic means as well. This technology may not work for all electric co-ops, but for those who want to use it, we need to change the current law. This bill will also require that all electric co-ops comply with existing transparency laws that currently only apply to co-ops of 25,000 or more consumer-members.

On the energy efficiency front, we plan to sponsor a bill that will make it clear that electric co-ops may engage in what is often referred to as “on-bill financing.” On-bill financing is used by some electric co-ops to enable their consumer-members to install energy-efficient appliances or make other energy efficiency changes with the cost to then be repaid through their electric bill. Again, not all co-ops have on-bill financing programs (that is a co-op by co-op decision), but, for those that choose to implement such programs, we will sponsor a bill to clarify how these programs are conducted.

The third bill we plan to sponsor relates to public schools and encourages school districts to work with their local electric co-op to explore opportunities to save money by deploying “beneficial electrification” or distributed energy resources such as wind or solar.

The term “beneficial electrification” was coined several years ago by the National Rural Electric Cooperative Association to describe opportunities for switching fuels like gas or oil to electricity, which is likely more cost effective and environmentally friendly. For instance, a school building currently using natural gas or propane for heating may be able to convert its heating and cooling system to electricity and save money over the useful life of the new equipment. Our legislation would simply state that school districts should consider these opportunities when they are constructing new buildings or renovating existing structures.

In addition to sponsoring these bills, CREA will watch for legislation that could impact the operations or autonomy of Colorado’s electric co-ops. There are often energy policy initiatives that surface in other states and then show up in Colorado. Not all of these initiatives make sense for Colorado’s electric co-ops, and we will work with our legislators so that they know how these changes could affect Colorado co-ops and their consumer-members.

We look forward to working with the representatives and senators in both the Colorado House and Colorado Senate and on both sides of the aisle. We will continue to support those legislators who support Colorado’s electric co-ops.

The legislative process is not always pretty (think sausage-making), but we should all be grateful that Colorado’s legislature provides an opportunity for thoughtful discourse for all those willing to engage in the process.

CREA will be so engaged on behalf of Colorado’s electric co-ops.

Kent Singer is the executive director of the Colorado Rural Electric Association and offers a statewide perspective on issues affecting electric cooperatives. CREA is the trade association for your electric co-op, the 21 other electric co-ops in Colorado and its power supply co-op.

My First Colorado Christmas

By Kent Singer, CREA Executive Director

Back in the mid-1970s, my sister Sandy moved from Kansas to Avon, Colorado, so she could ski during the winters and work evenings. She managed the Burger King in Vail in what used to be the Crossroads Shopping Center. (That area today is filled with luxury condos; we both wish she had bought a condo or two back then.) Although she barely eked out enough money for rent, she became a heckuva skier.

During Christmas week of 1976, my folks and I made the trip to Colorado to visit Sis and see Colorado in the winter. It was an epic snow year that winter and I’ll never forget my dad driving over Vail Pass through huge snow tunnels created by the snowplows. We got plenty of snow where I grew up in Topeka, Kansas, but nothing like winter in the Rockies. I’ll also never forget my mother’s nervous laugh as the back end of our Plymouth Fury III occasionally fishtailed on the snow-packed highway.

We arrived safely and the next day my sister “taught” me how to ski. This consisted of some rudimentary explanations of how to snowplow followed by one run down the bunny slope. Having clearly mastered the sport, she then took me straight to the top of the mountain. The next several hours consisted of me falling, swearing, getting up, falling, swearing some more and getting up again. Amazingly, this instructional method actually worked and after a couple of days of bumps and bruises I eventually fell in love with skiing.

On Christmas Eve, we went to the all-faiths chapel in Vail for midnight church services. If you recall your history, 1976 is the year that Jimmy Carter beat Gerald Ford in the presidential election. So in December, Ford was a lame duck president serving out his term and Carter would be inaugurated the following month. You may also recall that the Ford family had a home in Vail and that President Ford was an avid skier. (Despite his occasional trips in public, Ford was probably the most athletic of all U.S. presidents.)

I’m not sure if we were aware of the Ford family connection to Vail at the time, but not long after we were seated in the chapel, President and Mrs. Ford, along with their kids and a couple of what I presume were Secret Service agents entered the chapel.

Mind you, we had not passed through any kind of security screening or metal detector. We were bundled in winter clothes that could have easily concealed all manner of weapons; thankfully, that was not a likely threat given the time and place. The Fords sat in the back so as not to bother anyone, but of course everyone in the small chapel was aware of their presence. I didn’t think about it at the time, but I imagine the pastor might not have had the full attention of the congregants for the Christmas message.

After the service, we filed out into the snowy night and went back to my sister’s place for hot cocoa. Needless to say, my folks were pretty starstruck at the thought of being so close to a president. (They had most likely voted for him the month before.)

From then on it was always part of the Singer family lore that we “spent Christmas with the Fords.” This claim was further substantiated the next day as President Ford walked by us with a small security team, put on his skis and got on the chairlift.

I’ll always remember that Christmas of 1976: Mom posing in front of the Vail covered bridge, learning to ski with my sis, Dad’s intrepid driving. Oh, and did I mention we spent Christmas with the Fords? Merry Christmas to you and yours!

A Cautionary Tale of Blackouts

By Kent Singer, CREA Executive Director

As we have seen recently in California, whether or not you are ready to live without electricity is not a rhetorical question. On a Wednesday morning in early October, Pacific Gas and Electric Company shut off power to hundreds of thousands of its customers in northern California. PG&E took this extraordinary step to protect the public against the risk of fires that might have been ignited by the company’s equipment during extremely warm temperatures and high winds. Its “public safety power shut-off” program imposed power outages across 22 northern California counties.

PG&E took this action in the wake of several recent catastrophic fires caused by faulty equipment on the PG&E system. The resulting liability caused PG&E to declare bankruptcy earlier this year.

Rather than risk additional fires in October, PG&E de-energized large portions of its power grid to reduce the likelihood that an energized line might be torn down by winds and cause a fire. Hundreds of thousands of California electricity customers were without power for up to three days. Businesses went dark; nursing homes and hospitals scrambled to find backup sources of power; and the state’s emergency system normally used for natural disasters was activated.

While other utilities have imposed voluntary power shut-offs in limited circumstances, PG&E’s action is unprecedented in the history of the electric utility business in the United States in terms of the volume of customers impacted. And while the company attempted to communicate with its customers to give them advance notice of the power shut-off, the systems used to provide the notice largely failed.

While PG&E has come under withering criticism for its actions in this case, its experience is a cautionary tale for all utilities, including Colorado’s electric co-ops. Clearly, the same conditions that were present in northern California, that is, high winds combined with warm temperatures and dry vegetation and fuel, are possible in many parts of Colorado.

This is a situation that Colorado’s electric co-ops have taken seriously for many years. Colorado’s electric co-ops spend millions of dollars annually clearing trees and brush from under utility easements in an effort to prevent trees from falling into lines and starting fires. This work is complicated by the fact that we must work with many different state and federal governmental agencies to gain permission to clear the rights-of-way — as a Western state, hundreds of thousands of acres of Colorado are owned by the federal government and gaining permission to clear the rights-of-way can be difficult. These efforts are costly and just one more expense that co-ops must recover in the rates they charge their consumer-members.

Colorado’s electric co-ops are doing everything they can to make Colorado policymakers aware of the extensive system of transmission and distribution lines that co-ops own and operate in Colorado’s forests and plains. We have been fortunate that recent significant fires have not resulted in more property damage or loss of life. We need the assistance of the state and federal governments to help clear these rights-of way, both from a permitting standpoint and from a financial standpoint.

When asked about the California power shut-off, the president of the state’s public utilities commission said: “We cannot accept it (the shut-off) as the new normal. And we won’t.”

While we hope that Colorado’s electric co-ops never have to shut off the power to wide swaths of our systems in order to protect against the possibility of a fire, it remains a tool we have to consider in extreme circumstances. Colorado’s electric co-ops always take whatever steps are necessary to protect the safety of the communities we serve.

Electric Co-op Power Supplier Explores Clean Energy Options

By Kent Singer, CREA Executive Director

Last month the recently-hired CEO of Tri-State Generation and Transmission Association, Duane Highley, talked about the power supplier’s Responsible Energy Plan and his vision for how Tri-State will generate electricity for its member electric co-ops in the coming years. As part of that new direction, Tri-State has engaged the services of the Center for the New Energy Economy, a think tank at Colorado State University that is headed up by former Colorado Gov. Bill Ritter.

Back in 2006, when Ritter was running for election, one of his primary campaign promises was to create a “new energy economy” in Colorado that relied more on renewable energy and less on fossil fuels for electricity production. To that end, during Ritter’s four-year term, 56 pieces of legislation were passed that affected several areas of electric co-op business, including the expansion of Colorado’s renewable energy standard, programs to encourage leasing solar panels, and requirements for distributed generation and net metering.

Ritter’s focus on the new energy economy followed a ballot measure that passed in Colorado in 2004. Amendment 37 created a 10% renewable energy requirement for Colorado’s investor-owned utilities and the three largest electric co-ops. At the time, we were concerned that the higher costs of renewable energy would cause the rates of our consumer-members to increase. (Remember, in 2004, the price of a megawatt-hour of wind or solar energy was much higher than it is today.) However, by 2007, which was Ritter’s first year in office, the co-ops supported H.B. 07-1281, the bill that established a 10% renewable energy requirement for all electric co-ops by 2020. While we were still concerned about costs, we believed that a 10% standard was reasonable and could be achieved without rate increases.

Fast forward to 2013 when a bill was introduced (Senate Bill 13-252) that increased the renewable energy standard for electric co-ops to 20% by 2020. Although the costs of renewable energy were continuing to come down, we remained concerned about the impact of the legislation on rural ratepayers. We were also concerned that S.B. 13-252 was introduced late in the session with no input from the electric co-ops. We were extremely disappointed that legislative leadership at that time did not feel it was necessary to discuss such an important policy decision with the people it would impact the most. Despite our opposition, S.B. 13-252 passed and was signed by Gov. John Hickenlooper.

Fast forward again to 2019. Today, renewable energy prices have fallen to the point where they are competitive with traditional resources in many cases. That said, it is no small task for Tri-State or any other electric utility that has made large investments in traditional resources to make a dramatic switch in its generation portfolio without incurring additional costs that have to be covered by co-op consumer-members. The Colorado legislature, by passing House Bill 19-1261, has determined that this dramatic switch must be accomplished in approximately 10 years, a challenging goal for Tri-State.

So, Tri-State asked Ritter’s Center for the New Energy Economy to convene a group of stakeholders to look at possible strategies Tri-State could utilize to meet the challenge. The group held its initial meeting in September and will work over the next several months to develop recommendations. As a member of the stakeholder group, I’m excited about exploring options that will not only protect the affordability and reliability of the co-op electric grid, but also meet the objectives of our governor and legislature.

We will discuss Tri-State’s new direction and many other topics at CREA’s 10th annual Energy Innovations Summit October 28. Hope to see you there.