Saturday, July 18, 2009

Colorado PUC Hears Debate on Whether it Should Regulate Tri-State

Submitted by: Heartland Energy Colorado

Officials of Tri-State Generation & Transmission Association Inc., Colorado's second-largest electricity generator, and environmentalists debated whether the Colorado Public Utilities Commission should oversee Tri-State at a three-hour hearing Thursday.

And while nothing was settled, both sides clearly staked out their positions before a packed PUC hearing room.

The commissioners are expected to return to the issue in September.

The issue is whether the PUC should expand its power and begin reviewing Westminster-based Tri-State’s long-range forecasts for power demands from its Colorado customers.

Along with that, the commissioners are looking at whether the PUC should have the power to decide what combination of new power plants, energy farms and energy conservation programs the association should pursue to meet that demand – as the regulators do for the Xcel Energy Inc., the state’s largest utility.

Tri-State is the wholesale power supplier to 44 rural cooperatives in Colorado, Wyoming, New Mexico and Nebraska. Its board of directors is made up of representatives of the customer-owned cooperatives.

State regulators took up the issue in 2008, when it appeared that Tri-State wasn’t moving swiftly to add energy and energy conservation programs to its power portfolio. State law requires that Tri-State, as a group of rural cooperatives, get 10 percent of its power from renewable resources by 2020.

Ron Lehr, a former PUC chairman and a consultant for Conifer-based Colorado energy group Interwest Energy Alliance, said Thursday that efforts to cut Colorado’s greenhouse gas emissions requires a state-wide planning effort that could be overseen by the PUC.

"Colorado consumers and utilities face a challenge in transitioning to less fossil fuel, to me it subsumes the jurisdictional dispute that's being laid out," Lehr said. "If they [Tri-State] are as good as they say, they have nothing to fear from PUC review."

But Ken Reif, Tri-State’s senior vice president and general counsel, said the association’s Colorado customers do care about the state as a whole, and are capable of making decisions on their own.

He also noted that in recent months Tri-State has begun taking the steps its critics have wanted, from energy conservation programs to contracting for a 51-megawatt wind farm on the eastern plains and a 30 megawatt solar power plant in New Mexico.

"All the things that I hear Tri-State should be doing is being done at Tri-State right now, without any bump from this commission, with all due respect," Reif told commissioners.

"There’s no reason to believe the commission is any more well-equipped to make these decisions than Tri-State’s board and its board members," he said.

PUC Chairman Ron Binz asked for opinions on how far the PUC’s current authority over Tri-State went. Reif answered that laws protecting Tri-State board’s authority sharply limited the PUC’s power – although he later said there might be room for middle ground.


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