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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.

Another Point of View

For September, I asked Duane Highley, the new CEO at Tri-State Generation & Transmission, to share with Colorado’s electric cooperative consumer-members his thoughts on today’s energy industry and what we can expect as we look into the future. Here’s what he had to say:

A Responsible Energy Plan
By Duane Highley, Chief Executive Officer, Tri-State Generation and Transmission Association

Since 1985, my family has come to Colorado to rest, recharge and rediscover one another. The rugged landscapes and rugged people inspired us, and over the years it came to feel like home.

And now it is.

As Tri-State Generation and Transmission Association’s chief executive officer since April of this year, I am proud to finally call Colorado home. As an engineering intern beginning my career at a Missouri cooperative in the 1980s, I never imagined I would have the privilege of working in the great Western states of Colorado, Wyoming, Nebraska and New Mexico that Tri-State serves as a power supplier.

There’s no better time to be a member of an electric co-op, and no better place to be than here in the West. The rapidly changing electric utility industry and vibrant not-for-profit cooperative business model are creating opportunities to better support the communities we serve.

Tri-State’s board of directors, which represents each of our members’ co-ops, recognizes this and refined our mission statement recently. The core of our mission remains the same, but we’re simplifying and clarifying our focus. Tri-State’s mission is to provide our member systems a reliable, affordable and responsible supply of electricity in accordance with cooperative principles.

The words reliable, affordable and responsible are important. Reliability of electric service remains our first priority, followed closely by the affordability of power. We’ve added the word “responsible,” and while this is not a new concept for co-ops, we want to highlight the importance of being responsible to our members, our employees and our environment.

In the spirit of our mission, our board of directors also has directed the development of our Responsible Energy Plan. The plan will detail how Tri-State will be an increasingly clean and flexible power provider and will set goals and pathways to comply with state regulatory requirements.

Our plan will ensure the reliability and affordability of Tri-State’s wholesale power system and, importantly, strive to lower our wholesale rates to members while maintaining Tri-State’s strong financial position.

We’re off to a strong start. Today, nearly a third of the energy consumed by our members is from emission-free renewables. Tri-State’s wholesale rates are stable and we continue to refund capital credits to our members.

As a co-op, we’re working closely with our member co-ops to ensure the Responsible Energy Plan benefits each and every consumer-member. Former Gov. Bill Ritter and the Center for the New Energy Economy at Colorado State University are helping us engage stakeholders who have an interest in making our transition a success.

We’ve already taken meaningful actions and will have more specifics about the Responsible Energy Plan as it’s developed in the coming months. Right now, we’re reviewing new renewable energy projects and, earlier this year, we announced two projects that will increase our wind and solar power by 45%.

Importantly, a contract committee of our membership is reviewing how Tri-State can offer more flexible contract options for our members who would like to generate more renewable power locally.

We will comply with new carbon reduction and resource planning requirements passed by the Colorado legislature this year, and we have taken steps to ensure our wholesale rates are applied equally for all of our members by seeking federal rate regulation.

The Responsible Energy Plan also will help us understand the impact on our existing facilities and employees. We know there will be change, and we are committed to working with our employees and communities through these transitions.

The changes ahead create opportunities to serve our members reliably, affordably and ever more responsibly within our proven cooperative business model, and working together with our members, I know we will inspire a bright future.

Duane Highley became CEO of Tri-State Generation and Transmission Association in April. Tri-State, a member of the Colorado Rural Electric Association, supplies electric power to 18 of Colorado’s 22 distribution cooperatives, as well as 25 other electric co-ops in Wyoming, New Mexico and Nebraska.

Notes from Traveling to Colorado’s Co-ops

By Kent Singer, CREA Executive Director

You may have heard the Johnny Cash version of the country music classic “I’ve Been Everywhere” by Australian singer Geoff Mack. Although the song was written in 1959 and different versions have been recorded by many artists, Cash’s rendition from his 1996 “Unchained” album (backed by Tom Petty and the Heartbreakers) is the most famous.

The song is sort of a travelogue, listing all the towns the narrator’s hitchhiking adventures have taken him to in a tongue-twisting set of lyrics. The song originally referred to cities in Australia but was modified for an American audience when it was first recorded by Lucky Starr in 1962. Colorado gets a shout-out in the fourth verse:

“I’ve been to Pittsburgh, Parkersburg, Gravelbourg, Colorado, Ellensburg, Rexburg, Vicksburg, El Dorado …

“I’ve been everywhere, man.”

I think of this song every summer since summertime is annual meeting time for Colorado’s electric co-ops. As the executive director of the co-ops’ statewide trade association, my job includes attending the co-op annual meetings. It’s one of the best parts of the job. I travel the state to meet with not only the board of directors and staff at our member electric co-ops, but I also get to meet the consumer-members served by those local co-ops.

The best way to understand the issues facing rural Colorado and the consumer-members of our state’s 22 electric co-ops is to attend these annual meetings and hear what’s on people’s minds. In addition to providing a meal and entertainment, each of the co-ops sets aside time to take questions and hear the concerns of their consumer-members.

This is one of the important distinguishing features between electric co-ops and other types of utilities. Co-ops are owned by the consumers they serve and their governing boards are also comprised of residents of the local community. If a consumer has a question about a bill or any other aspect of the co-op’s business practices, he or she can speak directly to the co-op directors or management and get an answer. At the annual meetings I have attended so far this year, the Q&A periods were extensive with excellent discussions about energy policy, power supply, operational issues and other matters of concern to the co-op’s consumer-members. In every case, the co-op board and management responded to the questions with detailed answers or assurances to follow up if further research was necessary.

While important business is conducted at these co-op annual meetings, one of the most gratifying features of every meeting is the recitation of the Pledge of Allegiance and the singing of “The Star-Spangled Banner.” As hard as it is to believe, these American traditions seem to have fallen into disfavor in some circles. I’m glad to report that’s not the case in Colorado’s electric co-op country where every annual meeting opened with the pledge and anthem.

In every corner of our great state (electric co-ops serve over 70% of Colorado’s landmass), the electric co-op program is thriving and co-op consumer-members are proud to be associated with their local electric utility. Electric co-op consumer-members appreciate the personal service, the commitment to making their communities a better place and the forward-thinking attitude of their electric co-ops.

So, with apologies to Geoff Mack and the late, great Johnny Cash:

“I’ve been to Alamosa, Broomfield, Buena Vista, Durango, Fort Morgan, Granby, Hotchkiss, Lamar, Loveland, Monument, Ridgway, Sedalia, Steamboat Springs, Wray …

“I’ve been everywhere, man, crossed the deserts bare, man, I’ve breathed the mountain air, man, I’ve been everywhere.”

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.

Remembering Dad this Father’s Day, D-Day

By Kent Singer, CREA Executive Director

When my father passed away 20 years ago this month, my sister and I were heartbroken. Not only because we had lost our father but also, having lost our mother eight years earlier, we knew that our lives would never be quite the same without our folks.

I thought about my father a lot the last month or so as we commemorated the 75th anniversary of D-Day and, of course, Father’s Day. Dad did not fight in Europe in World War II, but he enlisted in the U.S. Army Air Corps and became an officer. Like thousands of men and women of the Greatest Generation, after the war he raised a family, worked hard and enjoyed spending time on his small Kansas farm where he grew up.

Dad was born in 1915 and the rural farmhouse where he was raised did not have electricity, indoor plumbing or a telephone. Although he worked fields behind a horse and plow as a kid, he lived to see a man walk on the moon. I have to chuckle when people suggest that our lives are changing faster than ever based on the development of new technology. I don’t think my dad would be all that impressed that the latest iPhone has facial recognition.

Dad was 43 when I was born, and we had different tastes when it came to music, culture and, of course, politics. But while we did not see eye to eye on many things, we shared a love of fishing and baseball and that was enough to make our relationship work pretty well. Dad taught me to fish with a cane pole when I was about 5 years old, and I’ve had the bug ever since. Whenever we spent time at the farm, the first thing I wanted to do was head down to Blue Hole to catch Old Fighter, the largemouth bass that always seemed to get away.

When I moved to Colorado, I learned how to fly fish and over the years I have acquired an embarrassing collection of fancy graphite fly rods and expensive reels. My dad’s fishing gear was not made by Scott, Winston or Sage, but rather ABU Garcia, Pflueger and Shakespeare. He did not own neoprene chest waders or polarized sunglasses; he made do with rubber hip boots and a Kansas City Royals ball cap.

But boy, could he catch fish. He could throw a number 2 Mepps spinner a hundred feet and drop it on a dime. He had that sixth sense that all great fishermen have: He knew where the fish were likely to be and how to make the right cast and retrieve to entice them to bite. Dad loved fishing for largemouth bass back in Kansas, but he loved fishing for Colorado trout even more.

And my goodness, was he tenacious. Like a hunting dog fixated on a running rooster, my dad would fight through all kinds of streamside trees and brush if it meant a better vantage point from which to cast a lure. It was not uncommon for him to come back from a fishing trip bruised and bloodied, the result of an encounter with a tree branch or a fall in a rushing mountain stream. Like most fishermen, he always needed to catch that one last fish of the day. And maybe one more.

It seems impossible that my dad has been gone for 20 years. I open his old tackle box once in a while because it reminds me of him: I can still smell the distinctive combination of sweat, blood and reel oil. Henry Lyman Singer was the best fisherman I ever knew; we miss you, Dad.

Colorado’s Electric Co-ops Ready to Work with Legislators

By Kent Singer, CREA Executive Director

Shortly after I graduated from law school in 1984, I moved to Denver and began my legal career as a staff attorney for the Colorado legislature. As an attorney in the legislative drafting office, my job, along with about 15 other lawyers, was to draft the hundreds of bills and amendments that are considered by the legislature each year. The legislative drafting office is now called the Office of Legislative Legal Services, one of the four nonpartisan staff agencies that support the work of the Colorado General Assembly.

As a legislative attorney, I worked with members of both the Colorado House and Senate, both Republicans and Democrats, to craft pieces of legislation to accomplish their policy objectives. This work often involved consultation with not only the members of the legislature, but also with lobbyists and other stakeholders whose clients or companies would be impacted by the proposed legislation.

Back in those days, it was unheard of for a member of the General Assembly to introduce a bill that would impact a particular business or company without first giving that business or company an opportunity to provide feedback on the bill. It was not at all uncommon for legislators to ask competing stakeholders to meet in a room and work out their differences.

Of course, when those differences could not be settled, the legislator sponsoring the bill would make the ultimate decision on legislative language. Yet, it was unusual for bills to be introduced where little or no opportunity was given to those affected by the bill to provide input and feedback.

Times have changed. In the just-completed 2019 legislative session, many important pieces of legislation were introduced with little or no opportunity for input from those who would be affected by the new requirements. From legislation regulating the oil and gas industry to bills mandating all sectors of the Colorado economy reduce carbon emissions, bills that will significantly impact Colorado’s energy economy were written over a period of months behind closed doors and without the input of impacted industries.

This was certainly true in the case of HB 19-1261, a bill that will impact rural electricity ratepayers for many years to come. Despite our requests to be included in the discussion of rational carbon regulation for electric co-ops, a plan was formed and imposed with little input from representatives of electric co-ops. This is unfortunate; we know our systems and facilities better than anyone, and electric co-ops should have had an opportunity to help design this legislation.

I’m fully aware that the majority party has the power to set policy direction in many areas; that’s how our system works. I’m also aware that some will say, “Why should we talk to you? You’ll just say no.”

That may have been a valid criticism in the past, but I don’t think it is true anymore. As a group, electric co-ops have recognized the changing energy industry and have taken responsible steps to generate more power from carbon-free resources while maintaining reliable service and affordable rates. While we continue to believe that our locally-elected boards should be the primary regulators of electric co-ops, we also understand that the power supply choices we make impact more than co-op consumer-members. We are working extraordinarily hard to make this transition in a way that focuses on continuing the economic vitality of rural Colorado.

I hope that a few legislators will read this column and consider inviting Colorado’s electric co-ops to the table the next time a major energy policy change is considered. I think you will find that we are interested in working together to find solutions to Colorado’s energy needs.

2019 Legislative Wrap-Up

By Kent Singer, CREA Executive Director

When the Colorado General Assembly adjourns sine die on May 3, one of the most significant recent legislative sessions for Colorado’s electric co-ops will come to a close. Among the many bills considered by the legislature this year were bills that promoted electric vehicles; encouraged solar gardens; required the collection of climate change data; created new energy efficiency standards; expanded the powers of the Colorado Public Utilities Commission; and authorized local governments to impose restrictions on oil and gas development.

This list does not include perhaps the most impactful bill, H.B. 19-1261, which requires the reduction of carbon emissions from all sectors of the Colorado economy. If passed, H.B. 19-1261 will have a significant and lasting effect on Colorado’s electric co-ops. The bill requires that all electric utilities, including co-ops, reduce the level of carbon emissions that are related to power production.

Colorado’s 22 electric distribution co-ops are at the end of a supply chain that includes many power plants and transmission lines owned by multiple entities. Eighteen of the state’s 22 co-ops have wholesale power contracts with Tri-State Generation & Transmission Association while the remaining four co-ops purchase their wholesale power from Public Service Company of Colorado, a subsidiary of Xcel Energy. So, bills that impact Tri-State and Xcel impact the distribution co-ops and their consumer-members.

H.B. 19-1261 would require that the carbon emissions of all industries in Colorado be reduced by 26% by 2025, 50% by 2030 and 90% by 2050. The bill does not state how much each industry has to reduce its emissions; instead, the legislature delegates broad authority to the Colorado Air Quality Control Commission in the Colorado Department of Public Health and Environment to adopt rules to accomplish the targets.

While the title and bill summary of H.B. 19-1261 says that the objective of the bill is to create “goals” for the reduction of statewide greenhouse gas emissions, it is clear that the bill contemplates that the Colorado Air Quality Control Commission will actually adopt standards, that is, legally enforceable requirements that will apply to many Colorado industries. While it is unclear how these standards will be enforced, it appears that the state will have the authority to impose a penalty on entities that fail to meet the standards that are created.

I wrote many columns over the last several years describing how Colorado’s electric co-ops are rapidly incorporating carbon-free power sources into our power supply mix. Today, thousands of co-op consumer-members have installed net metered rooftop solar arrays, and the distribution co-ops and Tri-State have integrated utility-scale solar farms into their resource mix. In the last six months alone, Tri-State has announced power purchase agreements for another 104 megawatts of wind and another 100 MW of solar power supply.

Steps taken by the co-ops and other Colorado electric utilities will result in reduced carbon emissions from the electric sector regardless of H.B. 19-1261. Our concern with the bill as it was introduced is that it did not take into account the important differences between the investor-owned electric utilities and the electric co-ops. Whereas Xcel Energy has an incentive to retire existing generating resources and earn a rate of return on the replacement power, the co-ops can only pay for new power plants with money from our rural consumer-members.

During the debate on H.B. 19-1261, the Colorado Rural Electric Association made it clear that electric co-ops support reductions in carbon emissions from the power sector, but that we oppose expanded state regulatory authority over electric co-ops. I’m hoping that by the time you read this we have been able to reach a compromise on H.B. 19-1261 that accomplishes the goals of the legislature but takes into account the cooperative difference.

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.