United Power files court complaint in effort to thrust $1 billion in costs onto other Tri-State members
- Tri-State openly pursued Federal Energy Regulatory Commission rate regulation.
- FERC regulates the rates of almost all wholesale electric service and transmission providers.
- United Power's false and reckless assertions ignore the facts and that Tri-State's move to FERC regulation has been open and transparent to its members, regulators and the public.
(May 4, 2020 – Westminster, Colo.) – Tri-State Generation and Transmission Association offered the following comments in response to United Power's announcement of a complaint filed in the Adams County District Court:
In 2007, United Power and 41 of its peers agreed to extend their wholesale power contracts to 2050. After fulfilling only 13 years of its wholesale power contract, United Power is seeking to leave Tri-State and stick its fellow member cooperatives and public power districts with the bill. United Power voluntarily entered into a contract with its fellow members to share the costs of power, and now it seeks to leave without fairly sharing those costs. While consistently and repeatedly stating in Tri-State's boardroom and in the press that it has no desire to exit Tri-State, United Power sees an opportunity to buy power elsewhere, but it can only lower its own costs if it shifts more than $1 billion of costs onto its partners.
United Power's most recent complaint smacks of desperation and is completely without merit. Tri-State will vigorously defend its members and its board of director's lawful, appropriate, and open decisions and actions to seek federal regulation. Further, United Power's complaint insults our other cooperative members, who clearly understood the direction of the association.
United Power has already filed at the Colorado Public Utilities Commission and is making the same case before the Federal Energy Regulatory Commission (FERC). It does not want to honor its promise to its fellow members and is looking for someone to let them off the hook. By filing in all possible venues, United Power is pursing a costly 'let's see what sticks' strategy to force Tri-State's other members in Colorado, Nebraska, New Mexico and Wyoming to pick up more than $1 billion in costs, because United Power does not want to honor its power contract obligations.
Tri-State and its member cooperatives have been open and transparent about their desire to be regulated by the FERC, to eliminate inconsistent rate treatment across the states. In recent years both Colorado and New Mexico have exercised rate jurisdiction, which resulted in increased costs, unrecovered revenue and inconsistent rates to its members.
Tri-State's move to FERC rate regulation is consistent with other similarly situated wholesale generation and transmission providers. In fact, FERC regulates the rates of almost all wholesale electric service and transmission providers, including Xcel Energy and its contracts with non-Tri-State Colorado cooperatives.
United Power's motives and proposals should be examined by the FERC, where all utilities receive a fair hearing. Public utilities like Tri-State that are subject to FERC regulation must charge rates that are "just and reasonable" and "not unduly discriminatory or preferential."
United Power's false and reckless assertions ignore the facts and that Tri-State's move to FERC regulation has been open and transparent to its members, regulators and the public:
- United Power was the primary driver behind the discussion of a bylaw change regarding contracts and memberships. In fact, United's board president sent a well-publicized letter in December 2018 encouraging all Tri-State members to support changing Tri-State's bylaws.
- At Tri-State's April 2019 annual meeting, delegates of its member systems, including United Power, approved a change of the association's bylaws that allowed the Tri-State board of directors to create additional classes of membership and contracts for its members as well as those entities interested in power and services from Tri-State.
- In July 2019, Tri-State announced that its board of directors took actions to place the cooperative under wholesale rate regulation by FERC.
- In September 2019, Tri-State announced the addition of its first non-utility member, resulting in Tri-State becoming subject to rate regulation by the FERC.
- In March 2020, the FERC recognized that Tri-State became jurisdictional to the FERC in September 2019, when it added its first non-utility member.
Tri-State and its members will continue to make monumental changes and focus on becoming a leader in the clean energy transition. Tri-State's Responsible Energy Plan sets a course for 50% renewable resources consumed by 2024, committing to eliminate 100% of its emissions from coal it owns or operates in Colorado by 2030, and greater member flexibility to self-supply power.
Tri-State is making great strides and hopes United will continue to work with us in an open and transparent process, rather than continue to file cases in court.
Tri-State is a not-for-profit cooperative of 46 members, including 43 member utility electric distribution cooperatives and public power districts 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 about Tri-State and our Responsible Energy Plan, visit www.tristate.coop.
Lee Boughey, 303-254-3555, firstname.lastname@example.org
Mark Stutz, 303-254-3183, email@example.com
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.