Allocation of Coal to Utah Under Negotiations in the MSP

Allocation of Coal to Utah Under Negotiations in the MSP
21 August 2018

Rocky Mountain Power is a subsidiary of PacifiCorp, a utility providing electricity to six states: Utah, Idaho, Wyoming, Washington, Oregon, and California.  Of these states, three (Oregon, Washington and California) have plans to stop paying for coal as early as 2025. The question remains: will the equivalent of coal that is allocated to these states be retired early, or will Utah and others get saddled with the cost and risk of coal resources that other states within our region no longer want?

The Latest

Negotiations are underway to broker a solution around the unwanted share in PacifiCorp’s coal units along with the associated costs that come with those resources.  Utah Clean Energy is adamant that this is an opportunity to decarbonize PacifiCorp's electricity system at a time when renewable energy prices are at an all-time low!

How Coal is Allocated Amongst Different States

PacifiCorp utilizes 23 coal units to help meet its customers’ electricity needs.  A percentage of each of these units is allocated to each of the six states in PacifiCorp’s system, proportional to the amount of electricity each state uses.  For example, Utah makes up about 42% of PacifiCorp’s electricity demand hence we currently are responsible for about 42% of the costs associated of the coal units.

What This Means for Utah

PacifiCorp originally presented the Coal Life Evaluation, Allocation and Realignment (CLEAR) plan. 

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The CLEAR plan proposed reallocating a portion of coal units to Utah, but does not reduce the overall amount of coal in its system.  Other states would get out of coal, but there would be no net decrease in carbon emissions from PacifiCorp’s system. This shift would increase not only Utah’s allocation of the coal-fired electricity, but also the pollution, costs, and risks associated with these coal plants at a time when increased energy efficiency and renewable energy would be a much better bet.

Finding a Better Solution

The current negotiations are an opportunity to expedite the de-carbonization of PacifiCorp’s system.  quote2v2Utah Clean Energy wants PacifiCorp to comply with Oregon, Washington and California's goals, but in a way that actually reduces the amount of coal in the system, and to prevent Utah from accepting the additional risk associated with PacifiCorp’s coal fleet.  The challenge is getting all six states, their respective regulators and stakeholders, and PacifiCorp to agree on how to retire coal units early. 

Negotiations on this complex issue are done in what is called the Multi-State Process which is an ongoing docket that Utah Clean Energy remains heavily involved in.  Look for additional updates as this issue unfolds.