As another sign of the growing carbon-constrained times facing energy providers, the Idaho Public Utilities Commission (PUC) Tuesday approved the latest version of Avista Utilities’ long-range integrated resource plan (IRP) that calls for deemphasizing coal-fired generation in favor of more natural gas and renewable-powered generation. Avista’s IRP serves as its road map for how it will meet customer growth in the next 10 years.
Avista dropped plans for new coal-fired generation that were part of its 2005 IRP. The latest — 2007 — plan also cuts back on the amounts of renewables called for from 500 MW to 350 MW, citing rising costs for wind power that have amounted to more than 100% during the past six years, Avista said.
Even though Idaho has yet to adopt a state renewable energy standard or limits on carbon emissions, standards in surrounding states, such as Oregon and Washington, are making less wind resources available and driving up their cost, the PUC said.
Spokane, WA-based Avista, which serves 115,000 electricity customers in northern Idaho, estimates that it will need 350 MW of gas-fired electricity supplies to meet its demand growth in Idaho. (The utility also serves gas and electric customers in the state of Washington, and natural gas retail customers in Oregon.)
Most of the gas-fired generation will come from Avista’s Lancaster Generation Facility near Rathdrum, ID, and it also plans to add 300 MW of wind-generated power, 35 MW of other renewables, and energy savings through conservation efforts that equates to 87 MW, according to Avista’s IRP.
“Without the additional generation, the company states it would face generation shortfalls of about 83 average-megawatts (aMW) in 2011, and 272 aMW by 2017,” the PUC said.
PUC staff has urged Avista to develop new and innovative methods to counteract what the regulatory analysts have identified as natural gas price volatility and to maximize what they call “cost-effective load-control programs.” Staff also urged utilities to put nuclear power generation back in their plans.
A PUC spokesperson said several utilities have dropped coal sources from their IRPs due to new emissions standards and higher costs associated with the potential for carbon taxes, making coal less competitive with other generation alternatives.
“Ironically, Idaho presently has neither carbon emission standards nor renewable portfolio standards, yet the new legislation in other states has effectively limited the new generation choices for serving Idaho loads,” PUC saff said. Utilities in Idaho like Avista that serve several states must meet the requirements in all the states they serve, the PUC said. “It is impractical to develop new generation projects devoted solely to serve Idaho loads.”
After moving away from planning new gas-fired generation in 2005 because of the price volatility in wholesale gas markets, the utility is returning to gas-fired power in the absence of coal-fired generation being an option, the utility indicated in its IRP.
In approving Avista’s IRP, the Idaho regulators made clear that they weren’t necessarily endorsing all of the proposed projects in the plan. “It means only that the utility has complied with a requirement to file an IRP every two years,” the PUC spokesperson said. “It is the ongoing planning process that we acknowledge — not the conclusion or results.”
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