Members, Tri-State file joint request for rehearing of settlement advancing flexible power contracts
- Opposition from United Power, which is withdrawing from Tri-State membership and has little to no interest in the settlement, should not derail benefits of clean energy transition for other cooperatives.
- Settlement filing with Federal Energy Regulatory Commission is supported by a majority of Tri-State members and unopposed by FERC trial staff.
- Commission erred in rejecting contested settlement, say five members and Tri-State in filing.
(January 23, 2023 – Westminster, Colo.) To ensure a timely cooperative clean energy transition, and to deliver economic development and local clean energy benefits to rural communities, the Federal Energy Regulatory Commission (FERC) should rehear and approve a settlement that clears a path for flexible contract options for utility members of not-for-profit power supply cooperative Tri-State Generation and Transmission Association, say the settling parties in a joint filing made to the Commission.
La Plata Electric Association (LPEA), High Plains Power, Jemez Mountains Electric Cooperative (JMEC), Poudre Valley Rural Electric Association (PVREA), San Miguel Power Association (SMPA) and Tri-State filed the joint request for rehearing of a settlement that would resolve the Commission’s buy-down payment proceedings, advancing the transition of the utility members to partial requirements memberships with Tri-State and providing the opportunity to self-supply up to 50% of their power requirements with additional clean energy resources. The settlement is supported by a significant majority of Tri-State’s utility members and Tri-State, and is unopposed by FERC Trial Staff.
United Power, which has stated its intent to withdraw from Tri-State membership on May 1, 2024, and is not pursuing a partial requirements contract, unilaterally contested the settlement, leading the Commission to reject the settlement under Commission precedent. The protest thwarted efforts to provide benefits for other Tri-State utility members to further diversify their energy portfolios and develop local clean energy projects to benefit their respective communities.
In the filing, the five members and Tri-State contend that the Commission erred by not approving the settlement as fair and reasonable under Commission precedent, which establishes it can approve a contested settlement if it determines that the benefits of the settlement outweigh the nature of the objections, and the interests of the contested party are “too attenuated.”
“The rejection of the settlement stalled our efforts to deliver local clean energy projects that could provide significant economic development benefits to our communities and emissions reductions to our state and region,” said Jessica Matlock, CEO of LPEA. “The settlement represented a huge step in the evolution of the generation and transmission association business model, and in bringing the direct benefits of the clean energy transition to rural communities.”
“High Plains Power is committed to serving its members with the most reliable, safe, and affordable energy. The rejection of the BDP settlement stalls our progress towards a more diversified, reliable and affordable power supply for our members,” said Darick Eisenbraun, CEO of High Plains Power.
Colorado-based LPEA, PVREA and SMPA, as well High Plains Power in Wyoming and JMEC in New Mexico, seek greater flexibility and local control to capture clean energy, emissions reduction and rate benefits for the rural communities they serve. To achieve this flexibility, while maintaining the benefits of membership in Tri-State, they diligently worked with other Tri-State members, finding compromise for partial requirements options and leading to agreement through the FERC’s settlement process. Importantly, the settlement reduces the regulatory uncertainty that threatens to undermine the members’ partial requirements projects that are already under development.
"SMPA is proud of the collaborative process that brought us to this settlement," said SMPA Chief Executive Officer, Brad Zaporski. "We are disappointed in one cooperative's illogical attempt to thwart our progress toward greater flexibility."
“Jemez Mountains Electric Cooperative, Inc., is already at its contract 5% limit with Tri-State for local solar projects,” said Michael W. Hastings, CEO and general manager. “This 30-megawatt allocation is necessary to meet the growing member interest in renewable power, specifically solar, and to give our electric cooperative the flexibility to purchase or construct more and different kinds of power.”
The filing describes how United Power has little to no interest in how partial requirements memberships will be structured for remaining Tri-State members. The timing of the transition of a member to a partial requirements contract, including its required buy-down payment, will not be part of Tri-State’s 2023 wholesale rate filing, which could go into effect in January 2024.
“United Power has little to no interest in this matter, as our members’ transition to flexible contracts will very likely occur after United Power withdraws from Tri-State,” Tri-State CEO Duane Highley said. “Any concerns about Tri-State’s wholesale rates must be addressed though our rate filing, and must not be allowed to disrupt this beneficial settlement with our members.”
Finally, the parties note the Commission erred by not addressing arguments that United Power’s settlement negotiations and tactics were not in good faith, raising questions about its real interest in the settlement proceedings, which could be attributed to gaining leverage in the separate contract termination payment proceeding.
The settlement agreement addresses issues in FERC Docket Nos. ER20-2417-000 and ER21-368-000.
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About High Plains Power
High Plains Power is a distribution cooperative founded in 1939 to serve central Wyoming. Today High Plains is proud to serve roughly 13,600 homes, farms, and businesses across over 12,500 square miles in Carbon, Fremont, Hot Springs, Natrona, and Washakie counties. For more information, visit highplainspower.org
About Jemez Mountains Electric Cooperative, Inc.
Jemez Mountains Electric Cooperative, Inc., (“JMEC”) was incorporated in 1948 as a non-profit electric cooperative and today serves more than 27,500 members and consumers in five northern New Mexico counties in the service districts of Española, Jemez Springs and Cuba. Its service territory includes Native American lands including those of the Jicarilla Apache Nation, The Navajo Nation as well as the pueblos of Jemez, Nambe, Ohkay Owingeh, Pojoaque, San Ildefonso, Santa Ana, Santa Clara and Zia. Spread out over 7,000 square miles with 4,142 miles of transmission and distribution lines, it is the largest electric cooperative in the state of New Mexico. For more information, visit jemezcoop.org.
About La Plata Electric Association
LPEA is a member-owned, not-for-profit electric distribution cooperative serving La Plata and Archuleta counties, with segments of Hinsdale, Mineral, and San Juan counties. LPEA is the fifth largest cooperative of 22 in Colorado and aims to provide safe, reliable electricity at the lowest reasonable cost to approximately 35,000 members. For additional information, visit lpea.coop.
About San Miguel Power Association
San Miguel Power Association, Inc. is a consumer-controlled rural electric cooperative with offices in Nucla and Ridgway, Colo. It is the Mission of the San Miguel Power Association, Inc. to provide our members with safe, reliable, cost-effective, and environmentally responsible electrical service, while demonstrating both co-operative responsibility and support for the communities we serve. SMPA serves approximately 10,000 members and 14,000 meters and supports local communities with over $300,000 annually in property taxes, over $100,000 in energy efficiency and renewable energy rebates and over $80,000 in scholarships, community donations and economic development grants. For more information, visit smpa.com/.
About Tri-State
Tri-State is a wholesale power supply cooperative, operating on a not-for-profit basis, with 45 members, including 42 utility electric distribution cooperative and public power district members in four states that together deliver reliable, affordable and responsible power to more than a million electricity consumers across nearly 200,000 square miles of the West. For more information, visit tristate.coop.
Contacts:
Jemez Mountains Electric Cooperative: Michael Hastings, 505-367-1155, mhastings@jemezcoop.org
High Plains Power: Darick Eisenbraun, 307-856-9426, deisenbraun@highplainspower.org
La Plata Electric Association: Hillary Knox, 970-749-6378, hknox@lpea.coop
San Miguel Power Association: Alex Shelley, 970-626-5549, ext. 2120, alex@smpa.com
Tri-State: Lee Boughey, 303-254-3555, lboughey@tristategt.org
Certain information contained in this press statement are forward-looking statements including statements concerning Tri-State’s plans, future events, and other information that is not historical information. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described from time to time in Tri-State’s filings with the Securities and Exchange Commission. Tri-State’s expectations and beliefs are expressed in good faith, and Tri-State believes there is a reasonable basis for them. However, Tri-State cannot assure you that management’s expectations and beliefs will be achieved. There are a number of risks, uncertainties and other important factors that could cause actual results to differ materially from the forward-looking statements contained herein.