Tri-State submits Letter of Interest to pursue USDA New ERA Program for electric cooperatives
- Resource planning and financial modeling indicates that a New ERA funding award would deliver significant greenhouse gas emissions reductions, reliability and affordability benefits to Tri-State’s membership.
- Tri-State would leverage significant federal grants and low-cost loans to support considerable transition investments.
(September 14, 2023 – Westminster, Colo.) Tri-State Generation and Transmission Association has submitted a Letter of Interest (LOI) to apply for funding through the U.S. Department of Agriculture’s (USDA) Empowering Rural America (New ERA) Program, that if awarded, would achieve significant greenhouse gas reductions, clean energy additions and stranded asset relief, while preserving affordable wholesale rates and maintaining reliable and resilient power for its member distribution cooperatives and public power districts.
“Our proposal would leverage the New ERA Program to transform our system, reducing greenhouse gas emissions and adding clean energy, while supporting grid resiliency even in the most extreme weather, and helping alleviate the impact of stranded coal assets to ensure competitive wholesale rates for all our members,” said Duane Highley, Tri-State CEO. “As a not-for-profit generation and transmission cooperative, all of our members across Colorado, Nebraska, New Mexico and Wyoming benefit if we can secure New ERA funding on their behalf.”
Although details in the LOI remain confidential in the highly competitive USDA process, Tri-State’s modeling indicates that a New ERA award would support a geographically diverse resource portfolio that preserves reliability and enhances resiliency, meeting industry-accepted and heightened extreme weather reliability metrics. In addition, Tri-State’s financial modeling validates that the portfolio would result in lower wholesale rates and a stronger balance sheet, relative to a base case.
Tri-State intends to efficiently leverage the maximum program budget authority of $970 million per entity through grants and low-cost loans to support an even greater investment in clean energy projects. Tri-State also would reduce portfolio costs by using other federal agencies’ programs, including the IRS direct pay tax credits.
“Tri-State’s LOI has strong support from our board of directors, representing our members, and is also supported by a broad group of stakeholders, including state officials, industry organizations and environmental non-governmental organizations,” Highley said.
Tri-State believes its LOI is very responsive to the criteria USDA has outlined for the program and should be competitive. Following USDA’s review of our submission, Tri-State hopes to receive an invitation to proceed to complete the full New ERA Program application, which could come this fall. Tri-State anticipates filing a New ERA “IRA” scenario, reflecting the portfolio a New ERA award would enable, in its Dec. 1, 2023 Electric Resource Plan.
Tri-State worked closely with other stakeholders to support the inclusion of $9.7 billion in funding for cooperative clean energy transition support, as well as the cooperative direct pay provisions for federal renewable energy tax credits, in the Inflation Reduction Act (IRA) of 2022. The New ERA Program implements the $9.7 billion funded in the IRA.
“These clean energy programs have the potential to be transformational for cooperatives like Tri-State," Highley added. "We appreciate the opportunity to compete for a once-in-a-generation federal investment in cooperatives that delivers a reliable, resilient and affordable clean energy transformation to our members and their consumers."
Tri-State is a power supply cooperative of 45 members, operating on a not-for-profit basis, including 42 utility electric distribution cooperative and public power district members in four states. Together with our member/owners, we 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 about Tri-State, visit www.tristate.coop.
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.