Portland General Electric Corp. (PGE) has turned the page with a $130 million settlement involving its newest natural gas-fired generation plant, allowing it to pursue a more low-carbon based future of increased renewable energy and storage reliance.
PGE's Carty Generating Station, a 440 MW natural gas-fired generation plant in eastern Oregon, opened in July 2016. Seven months earlier, when the plant was 70% complete, PGE fired the contractor and assumed control of the construction site.
"With the Carty settlement behind us, we are able to put our full attention on the future," PGE CEO Maria Pope told a 3Q2018 earnings conference call last Friday. She noted that the future involves ramping up non-thermal sources of generation to address a push to reduce carbon emissions by state officials.
Separately, Pope said that unprecedented gas and energy price volatility in the Pacific Northwest has been a major operating factor the past two years, and she sees that trend continuing.
"What is most notable in the third quarter is we have seen more volatility in the energy markets across the West than we have seen in the last decade, and are very pleased with how we managed through these market fluctuations, maintaining reliability and controlling costs effectively," Pope said.
"I wonder, in light of the volatility we have seen in natural gas and energy prices this year and last, if there ever will be a 'typical normal' for our region. That is why we are seeking additional decoupling mechanisms [from fuel costs] in our current rate case."
PGE reported 3Q2018 earnings of $53 million (59 cents/share), up from $40 million (44 cents) in the year-ago period. The Carty settlement's $10 million in net proceeds contributed 7 cents to quarterly earnings.
Last year, PGE submitted letters to Oregon energy and environmental agencies suspending a long-standing request to amend its site certificate for the Carty plant, as well as a related air permit application. The trigger for PGE's action was ongoing "bilateral negotiations" to line up new power supplies and/or power generation.
The utility made its request to both the Oregon Department of Energy and the state's Department of Environmental Quality.