In an extraordinary year marked by a pandemic and political upheaval, Northwest utilities rolled with the punches in 2020, and will be starting the new year with the possibility of things improving.
The year saw FERC derailing plans to remove four lower Klamath River dams when it ruled in July that PacifiCorp must remain a co-licensee of the dams because of its experience at dam removal, rather than transferring the license to the Klamath River Renewal Corp., which was formed for the task. The decision means at least a year delay in the dam removals and river restoration, and an estimated $12.5 million in added costs, KRRC said. PacifiCorp declined its role as a co-licensee, and instead proposed a plan in November to add Oregon and California as co-licensees with KRRC. PacifiCorp would contribute an extra $15 million for potential cost overruns, as would each of Oregon and California. FERC is now taking comments on the proposal.
The Willamette Valley Project reached a crossroads after a federal judge in Oregon agreed in August with environmental groups by finding the U.S. Army Corps of Engineers failed to meet many of its BiOp deadlines, and that it violated its incidental take permit while operating the project's 13 dams. Parties to the suit are working out an interim plan for operating the project until a new BiOp is completed. However, in late December, the Corps was authorized to conduct a study of the impacts from removing power production from the project's Cougar, Detroit and Big Cliff dams. De-authorizing hydropower for these dams is supported by public power proponents—who say the generation is too expensive—and salmon recovery advocates alike.
BPA had an eventful year, with Administrator and CEO Elliot Mainzer leaving in August to helm the California ISO, and COO John Hairston stepping in on an interim basis (although he was just named the permanent BPA chief).
Bonneville in September completed its integrated project review process to set the rate basis for fiscal years 2022-2023, and on Dec. 1 kicked off the BP-22 rate case, proposing to keep overall power rates flat, but increase overall transmission rates a total of 11.6 percent over the two-year rate period.
Idaho Power told regulators in June that BPA was considering pulling out of the $1 billion-$1.2 billion, 300-mile Boardman to Hemingway transmission line project they are partnering on together with PacifiCorp. Bonneville said it is also looking at several alternatives to the line for serving its six preference customers in southeast Idaho that are not connected to its grid. BPA had been serving them through power exchange and transfer agreements with PacifiCorp, but that deal ended in 2016, forcing the agency to resort to five-year market purchases and exchanges.
FERC on March 19 authorized the siting, construction and operation of the Jordan Cove liquefied natural gas terminal to export up to 1.08 Bcf of LNG per day, after the project was deemed down for the count just a few years before. The Department of Energy followed with its authorization of Jordan Cove on July 6. However, the facility still faces significant hurdles, including opposition from Oregon state agencies and litigation filed by landowners, tribes and environmental organizations.
Oregon-based NuScale reached a milestone in 2020 when the Nuclear Regulatory Commission in September issued final standard design approval of the company's small modular reactor. Together with the final safety evaluation report issued in August, the design can be referenced in an application to build or operate an SMR based on the design once a rulemaking of the approvals is completed sometime in 2021.
Washington Gov. Jay Inslee is trying once again to pass an ambitious climate package in the 2021 legislative session, which he unveiled in a Dec. 5 budget proposal. The package includes a carbon cap-and-reduction program, a clean fuels standard, expanded electrification of transportation and the state's ferry fleet, and reductions in the carbon footprint of buildings. Also, the proposed act considers social justice issues related to carbon reduction efforts.
For her part, Oregon Gov. Kate Brown abandoned legislative avenues for passing new climate laws after Republicans—the minority in both chambers—threatened a repeat of their 2019 walkouts to keep the bills from being heard. She instead issued an executive order directing the creation of climate action programs, which are still in the process of being implemented.
While these were all good stories, they didn't make our annual top five list.
Before revealing these, we'd like to thank you for reading and supporting Clearing Up.
We've been publishing regional energy news for more than 38 years, and we couldn't have done it without an engaged readership.
So before we step deeper into 2021, let us once again wish you a happy, healthy and prosperous new year!
5) Northwest moves closer to halting use of coal-fired generation
The past year has seen Oregon and Washington move closer to expunging coal from the portfolio of electric resources their utilities use, and Idaho Power throttling back on coal as well.
Portland General Electric shuttered the 550 MW Boardman plant—Oregon's only coal plant—on Oct. 15, an event negotiated with stakeholders in 2010.
In Washington, the first of TransAlta's two 670 MW coal-fired plants in Centralia permanently shut down on Dec. 31, per a 2011 agreement with Washington as part of ongoing efforts to reduce greenhouse gas emissions in the state. Unit 2 is slated to shutter in five years at the end of 2025.
Puget Sound Energy and Talen Energy permanently closed Colstrip units 1 and 2 (614 MW) in January, two years ahead of schedule. PSE had also planned to offload its share of Unit 4 to NorthWestern Energy in an effort to comply with the 2025 mandate of Washington's Clean Energy Transformation Act, but that stalled when Talen exercised its co-ownership right to get an equal share of the deal. However, this all came to naught when PSE and NWE withdrew from the deal in the face of criticism that the spirit of CETA was to shut down the coal plant, not keep it in operation past 2025.
In addition, PacifiCorp retired the its 395 MW Unit 4 of the Cholla Power Plant in Arizona, as previously announced, at 7:30 a.m. Dec. 24.
4) Wildfire season devastates Oregon and Washington
Utilities had planned for it; state agencies were preparing for it; and then on Labor Day weekend it came.
Persistent hot and dry conditions met up with howling winds and multiple ignition sources combined to make for the most destructive wildfire season in Oregon history.
The Labor Day fires in Oregon destroyed an estimated 4,200 homes, with nearly 500 homes in the Santiam Canyon, in Lane County, lost. Almost 1.1 million acres burned during the 2020 season, the most ever in Oregon. At one point, more than 10 percent of the state's population was under an evacuation warning or order.
The cost to fight the fires topped $600 million, according to published reports.
Washington only fared a bit better.
Fires in Okanogan and Douglas counties, near the cities of Omak and Bridgeport raged for days. The largest, the Cold Springs Fire, burned 189,923 acres, according to the Northwest Interagency Coordination Center.
The Oregon fires are still under investigation, but three lawsuits have alleged PacifiCorp's failure to de-energize its distribution lines—despite weather forecasts calling for extremely dry and windy conditions—was the source of the fires in Santiam Canyon. One of the suits says the fire burned "nearly a million acres and destroyed thousands of structures" and killed several people in the Santiam, Clackamas, McKenzie and Umpqua canyons.
The commander of a fire team stationed in Gates, Ore., said at a news conference that at approximately 9:45 p.m. on Sept. 7, power lines came down in the fire incident command post, causing rapid fire growth. Firefighters and others saw downed power lines start fires, the one lawsuit alleges.
3) California sees first rolling blackouts in almost 20 years
For the first time since the Western energy crisis of 2000-2001, the California ISO was forced to cut power because it didn't have enough generation to meet load.
On Aug. 14, just under half a million homes and businesses lost power for as little as 15 minutes and as long as 2.5 hours. On Aug. 15, another 321,000 utility customers went dark for anywhere from eight to 90 minutes the following evening.
Climate change-induced extreme heat, a failure to meet planning targets and certain practices in the day-ahead electricity market were the main factors in California's rolling blackouts, according to a multiagency report released in October.
While Pacific Northwest utilities avoided rolling blackouts during the Aug. 14 and 15 heat wave, one regional utility was caught short in the market.
Portland General Electric took a $128 million loss in the third quarter from “ill advised” energy trades that held short position in Southwest and California power markets and long in Pacific Northwest markets as wholesale prices spiked and transmission capacity was limited.
And while the lights stayed on in the Pacific Northwest, the August heat pushed some utilities to the brink.
As temperatures were pushing past 90 F in the Northwest on Aug. 21, and West Coast utilities were scrambling to find capacity, one Northwest utility faced a 700 MW deficit and was preparing to shed load. Instead, the utility met that deficit with the help of the Northwest Power Pool's reserve contingency sharing program.
2) Despite new ROD and BiOp, Columbia River System Operations still unclear
At the end of February 2020, action agencies released a draft environmental impact statement for operating the Columbia River System that analyzed breaching the four lower Snake River dams.
The final EIS released at the end of July included the draft's preferred alternative of balancing fish benefits and energy goals through a flexible spill program. That decision was finalized in a record of decision and accompanying BiOp issued in late September.
While breaching the dams would provide the largest benefits for several ESA-listed salmon, it would also result in unacceptably high adverse impacts to hydropower, navigation, irrigation and existing recreation.
The chosen alternative is based on the flexible spill operations from last spring, when—in an effort to help juvenile salmon migration—some of the eight lower Snake and Columbia river dams spilled a greater percentage of the river flow than ever before during 16 hours of each 24-hour period.
For the other eight hours, water went through turbines to generate power when energy prices were high. The operation was deemed successful for both power generation and fish. However, some environmental and fishing groups, tribes and the State of Oregon say the new operations won't do enough to recover fish, and filed notices of intent to sue over the decision, which they claim violates the Endangered Species Act.
Meanwhile, efforts to start a new framework to resolve inadequate salmon and steelhead returns to the Columbia Basin through a collaborative process are ready to kick off, after the governors of Washington, Oregon, Idaho and Montana announced plans to analyze and discuss key issues related to abundance. Litigation and collaboration appear to be two paths forward.
1) The pandemic takes its toll
After the COVID-19 pandemic took hold throughout the Northwest in March, it disrupted utilities, their customers, and fish.
Utilities have absorbed millions of dollars of outstanding balances from customers and saw demand shift between sectors as people sheltered at home. Public utilities asked for, and were given, relief from $39 million of BPA's Financial Reserves Surcharge over fiscal years 2020 and 2021 that were triggered by lagging reserves for risk.
In addition, electric and natural gas utilities throughout the region were directed by regulators to freeze service disconnections for late payment. Some states have allowed disconnections to resume, while other still have bans in place.
Utilities, as well as BPA, had to take measures to ensure the health of essential workers, including imposing a hiatus on field work when possible, which delayed construction of ongoing capital improvements. Limited field work resumed for the most part by summer.
The pandemic also impacted the region's fish-related issues, including the closure of recreational salmon and steelhead fishing in the Columbia River in March, and limited access to many recreational facilities, including boat ramps. Recreational fishing resumed May 5.
But COVID-19's reach into the Columbia Basin's salmon recovery world went much deeper.
Because of restrictions, a trawl in the estuary that gathers PIT-tag data of juveniles after passing Bonneville Dam was not operated at all this year, limiting the data scientists usually have to estimate juvenile survival rates for salmon and steelhead in the basin. Restrictions also prevented PIT-tagging of juvenile salmon and steelhead in some locations.
The pandemic also gave some salmon predators a reprieve, by delaying progress on fabricating a new barge large enough to handle Steller sea lions, which can now be captured and killed along with California sea lions to reduce their impacts to threatened and endangered fish.