Coal’s hazy future: Western co-ops opt out of dirty fuel
Plans are on the drawing table for another wave of coal-fired power plants across the West. But unlike 25 to 30 years ago, during the last binge in building power plants, this time there is opposition from a critical source—local ratepayers.
This opposition should not be overstated. In most areas, the electrical co-ops that provide power for most of the rural West are dutifully hitching their wagons to coal for another half-century. Coal is cheap, coal is reliable, while wind, solar and other alternative energies are more intermittent and more expensive, at least given today’s prices.
But driven primarily by global warming, two electrical co-ops, one in New Mexico, the other in western Colorado, have rejected contracts that build in new coal-fired plants. In the short run, this decision looks risky. Coal is proven, and we have lots of it. However, it may become a lot more expensive if—as many people expect—the federal government imposes a carbon tax after the next presidential election.
Another rebellion was in the Sierra Nevada, between Reno and Sacramento. There, with California Gov. Arnold Schwarzenegger looking over their shoulder, directors of the Truckee Donner Utility Board rejected a 50-year contract for electricity from a power plant planned in Utah. More important, people came out of the woodwork to testify in a case that gripped the community for weeks. People who six months before had no idea where their electricity came from trooped up to microphones. This was the global warming debate at the grassroots level.
Dozens of rural electrical co-ops in several Rocky Mountain states have also been debating the future of coal. Last year, the Denver-based Tri-State Generation and Transmission power provider announced plans for three coal-fired plants. Most of the 44 member co-ops in a four-state area, particularly those in the agriculture-based areas, quickly agreed to contract extensions to the year 2050. But debate continued for months at other co-ops, and during that period, two of those plants mysteriously vanished from Tri-State’s plans.
In the end, two co-ops refused to sign the extended contract with Tri-State. One was New Mexico’s Kit Carson Electric. Based in Taos, it encompasses pockets of wealth in a three-county area but plenty of barely-making-it folks. Luis Reyes, the chief executive officer, describes a future powered by coal as a shaky business proposition.
The contract with Tri-State has too many unfilled blanks about financing, he says, and more broadly, the plans assume that coal will remain cheap. He and his board of directors doubt it. They expect a fight in Washington soon about a carbon tax, and eventually, he says, “There will be a tax imposed on conventional coal-fired power plants.” That makes coal a risky proposition for people who count their pennies.
But there’s another issue here, that of local economic development. When the rural co-ops were created in the 1930s, they bought from investor-owned utilities. Then, after World War II, they formed generation and transmission cooperatives, which built power plants that the retail co-ops supposedly owned and that supplied them with power.
The wisdom of that consolidation is being attacked as rural co-ops have begun to say that they want more latitude for creating their own electricity, be it from wind, solar or biomass. At present, Tri-State’s 44 member co-ops can generate no more than 5 percent of their power from local renewable sources. At Kit Carson, Reyes is betting these alternative technologies will catch up and give non-resort rural communities a chance to prosper. While the cities and resorts of the West are booming, he notes, not all rural areas are.
In western Colorado, this same strategy of economic diversification was wrapped in red, white and blue at the annual meeting of Delta-Montrose Electric, the only other co-op that refused to extend Tri-State’s contract. Unlike most places that talk loudly about global warming, this area did not vote for John Kerry in 2004. Instead, local voters gave the Bush-Cheney ticket a plurality of 67 percent of their votes.
Yet this co-op is redefining what is responsible and wise. It’s aiming for many small answers to keep more money at home: hydro-electric on local farms, the piles of sawdust at a local sawmill, small solar collectors. Ironically, the district includes underground mines that produce 1.5 percent of the country’s coal.
At the nearby resort town of Telluride, the annual meeting of the San Miguel Power Association yielded high drama as more than 50 residents took over the meeting to demand more locally sourced electricity. But amid the theater, there was also substance. One of the speakers at Telluride, Pamela Lifton-Zoline, said many of the rural co-ops haven’t yet figured out that global warming has redefined their mission of providing cheap power. “They need to provide responsible power, and they haven’t recalculated that yet.”
If you listen closely, that’s what you hear out in the rural and oh-so-conservative burgs of the West: impatience with the old ways of thinking about electricity.
Allen Best is a contributor to Writers on the Range, a service of High Country News in Paonia, Colo. (hcn.org). He writes in Denver.