Colorado, USA — Last Friday, Governor Hickenlooper signed SB 045 into law. The law creates a 17-member task force, comprised largely of utility interests, to decide if a commission to streamline new transmission siting and permitting decisions is needed. The study is expected to be privately funded by utility interests.
As we’ve argued previously, such a commission would effectively undermine local decision-making authority over new transmission and slow down progress on renewable energy by forcing costly ($1.5 million/mile on average) and unnecessary new transmission.
While the result is, perhaps, a foregone conclusion, the task force must at least consider public input (gathered through four open meetings) before making its recommendation by December 1st. Those who support utility transparency, local control and distributed renewable energy generation shouldn’t miss the opportunity to participate in these meetings.
What is the reasoning behind SB 045?
The bill clearly states that, “the development of new electric transmission facilities is necessary to promote the development of additional clean and renewable electric generation resources, Colorado’s energy security, and the state’s long-term economic growth.”
If this is so, how has the state’s largest utility, Xcel Energy, been able to meet its renewable energy obligations 12 years ahead of schedule on the existing grid?
Although Xcel is still seeking to gain approval for new transmission into the San Luis Valley, the investor-owned utility shuttled efforts to obligate the new line to 700 MW of solar within 10 years. The PUC capitulated to Xcel’s wishes by rejecting its own administrative law that judges advise.
Looking elsewhere, Rep. Claire Levy, one of the bill’s sponsors, said in the Pueblo Chieftain, “Bottlenecks in the grid, mutations and buildup of the grid, is one of the impediments to moving toward a smart grid, to doing more renewable development.”
This statement implies that the Smart Grid requires new transmission. Do the facts confirm this?
While modernization of the existing grid is essential for integration of renewable energy and developing the Smart Grid, new transmission is not a real constraint. In fact, one of the greatest advantages of distributed renewable energy is that it can be integrated faster, and is cheaper and more reliable without costly new transmission.
The lack of progress in renewable energy is, perhaps, more the result of utility resistance to decentralizing the grid through local clean energy generation, an essential step in the evolution of the Smart Grid.
Investor-owned utilities have consistently opposed effective local energy generation incentives, like feed-in tariffs.
Earlier this year, Xcel Energy dealt a serious blow to the distributed solar energy industry by cutting Solar Reward programs much faster and deeper than expected. Legislature also approved a number of “perverse incentives,” including HB 07-100 that guarantees full cost recovery for new transmission and up to 13% returns and certain provisions of HB 10-1001. These and other incentives favor remote, centralized renewable energy generation that requires new long-distance transmission.
According to transmission planner Jaleh Fiooz, the data doesn’t support industry claims that transmission investment has failed to keep pace with energy demands or caused unacceptable levels of grid congestion. In fact, the opposite appears to be true. “Transmission investment has far outpaced the rate at which energy demand has grown, and congestion-related impacts in most areas of the interconnected grid have been relatively minor, certainly not at levels that would justify massive increases in new transmission investment,” said Fiooz.
“This effort is not surprising considering that network upgrades create more rate base and therefore higher profits for IOUs,” Fiooz concludes. “We are wasting millions of dollars on transmission, consumer monies that would be more productively spent on developing and connecting the renewable resources themselves.”
If, as stated in the bill, the goal is to increase renewable energy, improve energy security and support the state’s long-term economic growth, then distributed generation using the existing grid must be given serious consideration. Numerous studies show that DG outperforms remote central station generation on every count. For this to happen, the need for new transmission must be carefully scrutinized by entities other than those who stand to profit.
Without the small modicum of public oversight afforded by county permitting, a state-level commission dominated by utility interests will, quite predictably, lead to streamlining unnecessary new transmission that promotes an outmoded centralized energy infrastructure for the benefit of a few private investors.
If a transmission streamlining commission is inevitable, lets insist that it be balanced, transparent and independent. Let’s insist that it give full consideration to alternatives that don’t require costly new transmission. Let’s insist that it not be just another utility coup d’état at the expense of ratepayers and local communities.