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Renewable Energy Cheaper then Tri-State Rates

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THIS PROGRAM HAS BEEN BROUGHT TO YOU BY ALPINE
BANK. DEDICATION YOU CAN COUNT ON. AN EXPERIENCE YOU CAN TRUST. ALPINE BANK MEMBER FDIC. YOU’RE WATCHING DURANGO TV NEWS. I’M DEBORAH
URODA SITTING IN FOR WENDY GRAHAM SETTLE. TWO RECENTLY COMPLETED STUDIES INDICATE THAT
THE LA PLATA ELECTRIC ASSOCIATION COULD REASONABLY END ITS CONTRACT WITH THE TRI-STATE GENERATION
AND TRANSMISSION COOPERATIVE AND STILL MAINTAIN A RELIABLE POWER SUPPLY WITH MORE SUSTAINABLE
ENERGY AT A LOWER COST THAN IT PAYS TRI-STATE FOR SERVICE TODAY. THOSE WERE THE KEY CONCLUSIONS
PRESENTED AT THE L P E A BOARD MEETING LAST WEEK. EARLIER THIS YEAR, THE LA PLATA ELECTRIC
ASSOCIATION BOARD OF DIRECTORS HIRED ALBUQUERQUE-BASED ENCHANTMENT ENERGY CONSULTING AND RIO ENERGY
AS PARTNERS TO CONDUCT A MARKET ANALYSIS OF THE COOP’S CURRENT CONTRACT AND ENERGY SUPPLY
FROM TRI-STATE. ANOTHER CONSULTANT, ENERGY STRATEGIES FROM SALT LAKE CITY, ANALYZED WHETHER
LPEA COULD PURCHASE ALTERNATIVE SOURCES OF RENEWABLE ENERGY AT A REASONABLE COST. TRI-STATE
GENERATION AND TRANSMISSION ALSO IS A MEMBER-OWNED COOPERATIVE THAT SUPPLIES WHOLESALE ENERGY
TO 43 DISTRIBUTION COOPERATIVES IN WYOMING, NEBRASKA, COLORADO AND NEW MEXICO. WHILE TRI-STATE
PRODUCES 30 PERCENT OF ITS ENERGY FROM RENEWABLE RESOURCES, TRI-STATE CURRENTLY LIMITS THE
AMOUNT OF RENEWABLE ENERGY THAT ITS MEMBER COOPERATIVES CAN PRODUCE TO 5 PERCENT OF THEIR
TOTAL ENERGY CONSUMPTION. HOWEVER, THE L P E A BOARD HAS SET AS A GOAL TO REDUCE ITS
USE OF CARBON-BASED ENERGY BY 50 PERCENT BY THE YEAR 2030 WHILE KEEPING CONSUMER PRICES
AT 70 PERCENT OF PEER COOPERATIVES. UNDER ITS CURRENT CONTRACT WITH TRI-STATE, LPEA
CANNOT MEET THAT GOAL. ONE OF THE THINGS THAT HAS BEEN DRIVING LPEA
IS THE RESTRICTIONS ON DEVELOPING LOCAL RENEWABLE GENERATION. WE HAVE THE ABILITY RIGHT NOW
UNDER OUR CONTRACT TO SELF SUPPLY WITH LOCAL RENEWABLE GENERATION UP TO 5% OF OUR LOAD.
WELL WE’VE HIT THAT AND WE’VE SPENT SEVERAL YEARS TRYING TO WORK WITH TRI STATE ON IDENTIFYING
WAYS TO INCREASE THAT AMOUNT AND GIVE US MORE FLEXIBILITY TO DO THAT. AND THOSE HAVE NOT
BEEN FRUITFUL AND THAT REALLY ULTIMATELY LED US TO START LOOKING AT “OKAY IF IF THIS
IS THE LIMIT. IF THIS IS ALL WE’RE GOING TO BE ABLE TO DO, CAN WE DO POWER SUPPLY DIFFERENTLY
AND BETTER.” YOU KNOW FROM TRI-STATE AND THAT WAS KIND OF THE GENESIS OF WHAT CAUSED
US TO LOOK AT THIS. SO THE BOARD SAID, “OKAY WE’RE GONNA ESTABLISH A POWER SUPPLY COMMITTEE
AND WE TASK YOU WITH TWO THINGS. NUMBER ONE TELL US WHAT THE VALUE OF OUR CONTRACT CURRENTLY
IS AND NUMBER TWO TELL US WHAT THE ALTERNATIVES ARE OUT THERE IN THE MARKETPLACE IN THE WESTERN
UNITED STATES FOR POWER SUPPLY IN LIEU OF OUR CURRENT SUPPLIER.” THE ENERGY STRATEGIES REPORT INDICATED THAT
LA PLATA ELECTRIC WILL BE ABLE TO PURCHASE RELIABLE SOURCES OF RENEWABLE ENERGY TO MEET
ITS NEEDS, THAT IT WILL BE ABLE TO TRANSMIT THAT POWER OVER THE CURRENT GRID OPERATED
BY TRI-STATE AND THE WESTERN AREA POWER ADMINISTRATION, AND THAT L P E A SHOULD BE ABLE TO PURCHASE
SUSTAINABLE ENERGY SUPPLIES AT A LOWER COST THAT IT CURRENTLY PAYS TRI-STATE FOR ITS MIX
OF COAL AND SUSTAINABLE ENERGY SOURCES. THIS HAS A LOT OF PROMISE FOR US. WHAT WE’RE
LOOKING AT, WHAT WE’RE STUDYING, WHAT WE’RE THINKING ABOUT TRYING TO DO. BUT THERE ARE
THREE THINGS THAT WE WANT TO MAKE SURE THAT WE MAINTAIN. NUMBER ONE RATE COMPETITIVENESS
THAT WE’VE ALREADY TALKED ABOUT. NUMBER TWO DON’T IMPAIR RELIABILITY. MAKE SURE THAT WE
KEEP THE LIGHTS ON. ONE OF THE THINGS THAT WE FOUND OUT AS A RESULT OF THESE TWO CONSULTANT
STUDIES IS THAT’S ACHIEVABLE. WE DON’T HAVE AS MUCH CONCERN, BUT WE STILL NEED TO DO SOME
ADDITIONAL DUE DILIGENCE, BECAUSE WHILE WE’RE NOT CONCERNED ABOUT RELIABILITY WE ARE CONCERNED
ABOUT THE PRICE. AND THEN THE THIRD THING IS DON’T IMPAIR THE FINANCIAL CONDITION OF
THE COOPERATIVE. WE BELIEVE THAT WE CAN MAINTAIN THOSE THREE THINGS, BUT A REALLY CRITICAL
PART IS HOW DO YOU GET THE POWER DELIVERED HERE. LA PLATA ELECTRIC STILL MUST DETERMINE WHETHER
IT CAN NEGOTIATE A CHANGE IN ITS CONTRACT WITH TRI-STATE TO PURCHASE MORE SUSTAINABLE
ENERGY FROM OTHER SOURCES OR WHETHER IT WILL HAVE TO BUY OUT ITS CONTRACT WITH TRI-STATE
AND PURCHASE ALL ITS ENERGY ON THE OPEN MARKET. AND THE COST OF THAT BUY-OUT MAY PLAY AN IMPORTANT
FACTOR IN THAT DECISION. IF THE COST OF ENDING THE TRI-STATE CONTRACT IS TOO HIGH, IT COULD
DRIVE UP ENERGY COSTS FOR LA PLATA ELECTRIC CONSUMERS BEYOND WHAT THE COOPERATIVE CAN
BEAR. LA PLATA ELECTRIC IS LOOKING TO THE KIT CARSON ELECTRICAL COOPERATIVE IN NEW MEXICO
FOR GUIDANCE. KIT CARSON WAS THE FIRST TRI-STATE MEMBER TO LEAVE THE POWER AND GENERATION TRANSMISSION
COOPERATIVE TO PURCHASE ADDITIONAL SUSTAINABLE ENERGY IN ITS POWER MIX. BUT DREYSPRING SAID
THAT TRI-STATE MEMBER COOPERATIVES ARE HAPPY WITH TRI-STATE’S EFFORTS TO REDUCE ITS CARBON
FOOTPRINT, BUT ITS CHANGES AREN’T EXTENSIVE OR FAST ENOUGH FOR THE MEMBER-ELECTED LA PLATA
ELECTRIC BOARD OF DIRECTORS. WE’VE GOT TO FIND A WAY TO SEQUESTER CARBON.
YOU KNOW, OUTPUT IS NOT JUST WITHIN THE TRANSPORTATION INDUSTRY BUT IT WITHIN THE ELECTRIC UTILITY
INDUSTRY. SO I DON’T THINK THERE’S ANY QUESTION THAT’S THE DIRECTION THAT WE’RE HEADED. THE
QUESTION NOW IS, YOU KNOW, HOW MUCH THE MEMBERS WITHIN TRI-STATE ARE SAYING “YEAH WE SEE
THAT RISK”. THAT WE’VE GOT TO DO SOMETHING ABOUT AND THEY’RE WILLING TO VOTE THAT KIND
OF A CHANGE. I HOPE AND BELIEVE THERE’S SOME BASIS YOU KNOW FOR COMPROMISE, BUT ONE OF
THE REASONS WHY WE’RE DOING THIS IS BECAUSE, YOU KNOW, IF IT’S NOT WE’RE NOT GOING TO BE
THE FIRST ONES TO HAVE DONE THIS. I MEAN, KIT CARSON HAS ALREADY DONE THIS SUCCESSFULLY.
YOU KNOW WE WANT TO MAKE SURE THAT,YOU KNOW THE EARLYBIRD MAY GET THE WORM BUT THE SECOND
MOUSE ALWAYS GETS THE CHEESE. CAN WE DO THIS BETTER? YOU CAN FIND COPIES OF THE POWERPOINT PRESENTATIONS
ON THE STUDIES AND A RECORDING OF THE MAY 17TH MEETING AT WHICH THEY WERE PRESENTED
ON THE LA PLATA ELECTRIC WEBSITE AT LPEA.COOP. THANKS FOR WATCHING THIS EDITION OF DURANGO
TV NEWS. IF YOU LIKED THIS STORY AND WANT TO WATCH IT AGAIN, LOG ON TO OUR WEB SITE
AT DURANGOTV.COM. YOU’LL ALSO FIND AN ARCHIVE OF OUR PAST STORIES ON THE WEB SITE. IN THE
MEANTIME, CATCH OUR LATEST STORIES ON DURANGO CABLE CHANNEL 15 OR OUR DIGITAL SIGN NETWORK
IN PRIME LOCATIONS AROUND DURANGO. I’M DEBORAH URODA FOR DURANGO TV NEWS.

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