No Decisions Yet As State Agency Deliberates Controversial Utility Plan

Jul 21, 2020

A unit of the Jim Bridger Power Plant in Sweetwater County, pictured here, could face a 2023 retirement date rather than 2028
Credit The Center or Land Use Interpretation

The Wyoming Public Service Commission (PSC) has wrapped up its week-long hearing regarding its investigation into a western utility's Integrated Resource Plan (IRP) released in October. The commission made no decisions or actions before adjourning other than setting a deadline for additional briefs.

The preferred portfolio would retire several coal plant units in Wyoming along with New Mexico and Montana. It would then develop significant solar, wind, and battery storage resources throughout the region.

The investigation began in November, 2019 as the PSC pointed to concerns around the plan's impacts to Wyoming energy consumers. The PSC said it's the first IRP to be investigated to its knowledge. Commission Chairman Kara Fornstrom said the goal of the hearing and investigation was to learn more.

"I stated publicly on a few occasions that I hoped this investigation would help me answer two fundamental questions. First, is the preferred portfolio economically sound in second, does the preferred portfolio ensure reliability?" she said.

Those points, among others, were hotly debated as nine intervening parties introduced and cross-examined witnesses digging into the unique IRP. Several urged the PSC to deny the plan, while others simply pushed them to require significant new analyses for future plans.

"I can't tell you how important I believe this case is to the future. Not only when I mean ratepayers, but Wyoming citizens. And I have to tell you that I have taken what I consider to be the requisite effort to make sure that the Commission is fully informed in its investigation in this manner," said Bryce Freeman, Wyoming Office of Consumer Advocate administrator.

The opponents included industrial energy customers, an energy company looking to develop carbon, a coalition of affected local governments, and a state citizen's group.

"We really try to bend over backwards to make ourselves available."

Those entities argued that PacifiCorp did not include a vast array of necessary reviews including a socioeconomic analysis, impacts of recent Wyoming legislation, a business-as-usual study, potential for carbon capture, and the environmental impacts of developing significant new projects.

"This process needs to slow down and make sure that all of these issues have been adequately addressed. It would be unfortunate if this kind of two-year cycle was driving decisions that were not optimal," said Kenneth Lay, who testified for the citizens group the Northern Laramie Range Alliance.

The idea of a socioeconomic analysis was a sticking point throughout the week as parties detailed the impacts of early coal plant retirements in the state.

The Coalition of Local Governments represents Sweetwater and Lincoln counties where Rocky Mountain Power plans to retire several coal units early. Lincoln County Commissioner Kent Connolly said the closure will cost his county 50 percent of its taxes. He said he's already seen a $3.7 million tax impact from the closure of unit 3 of the Naughton Power Plant.

Sweetwater County Commissioner Wally Johnson said the early closure of the Jim Bridger Power Plant and mine would cause 3000 workers to lose their jobs.

"Rocky Mountain Power... they can do whatever they want. I understand that. Because, they don't have a heart about the effects they're having on the people," said Johnson. "I think they've done a very poor job of letting people know what's going to come down here, but they're a big company. I don't believe that other ratepayers should pay for what's happening here."

The company later pushed back on many points, including this one.

The transition of resources within Pacificorp's preferred portfolio
Credit Pacificorp

"We really try to bend over backwards to make ourselves available; spending multiple days at each session, taking the time to work through each of the issues on the agenda," said Rick Link, PacifiCorp's vice president of resource planning and acquisitions.

He went on to give his opinion on requested analyses for future IRPs. He explained a socioeconomic analysis would "fundamentally alter" the foundation of the IRP given its primary goal of minimizing the cost of electricity while maintaining reliable service.

Link explained the requested business-as-usual analysis also makes little sense given an IRP inherently shows a level of need for new resources.

He did say carbon capture could be an area of exploration as the utility considers its next IRP in 2021.

As to questions about the dramatic shift in the utility's use of resources from 2017, Link said it's not about other state policies, or outside pressure.

"The entire analysis is driven by shifts and changes in the market conditions and there's not one single one to point to. It's a combination of various factors. Relative to what was assumed in 2017 IRP, a very significant reduction in the cost of new technology that have fallen considerably from what was assumed there" he said, adding that federal incentives for renewables played a role too.

The PSC declined to give a range of what actions they have the power to take. There's debate over whether the commission has the power to decline any IRP or even enforce new analysis for future IRPs.

Kenneth Lay, witness for the Northern Laramie Range Alliance, said it's possible.

"We are aware that some of the parties believe that it may exceed the scope of the Commission's authority. But in this area, we see no reason not to defer to the Commission's judgment," he said. "I think we indicated this as well, in one of the documents, that it isn't the first time that the Commission has addressed issues beyond the traditional, reliable service at lowest cost standard in some of its deliberations, and so I don't in that sense, this is not a lot of new ground."

Shannon Anderson, staff attorney for the Powder River Basin Resource Council, a landowners group, disagreed saying there's no basis in Wyoming law to deny an IRP.

PSC Chief Counsel Chris Petrie said it's not correct to say that the state doesn't have the authority to take action on an IRP, but that it's never been addressed.

In a statement, PacifiCorp said these proceedings showed the significant ways it's investing in Wyoming with projects currently totalling more than $2.6 billion.

"The PacifiCorp Integrated Resource Plan shows Wyoming is well positioned to be the center of the ongoing transition to the new diversified energy economy, and [our] rigorous planning to help Wyoming navigate that transition," it read.

Intervening parties have an August 24 deadline to file briefs with the PSC related to the investigation. Commissioners will then begin deliberations in mid-September.

Have a question about this story? Contact the reporter, Cooper McKim, at cmckim5@uwyo.edu.