FERC case re DMEA – Tri State renewable generation dispute

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This topic contains 2 replies, has 3 voices, and was last updated by Dave Munk Dave Munk 2 years, 3 months ago.

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  • #8330
    Delta-Montrose Electric Association in western Colorado received a ruling from FERC about a year ago saying that DMEA, a distribution coop, was obligated to buy power from Qualifying Facilities.  Now DMEA’s G&T, Tri-State, has filed a request with FERC that would approve them to charge a rate penalty on DMEA if they buy QF power.
    To maintain the effective ability of distribution coops to buy local renewable power from QF’s, DMEA needs FERC to hear from coop board directors and others from all over the country.  Please consider submitting a comment letter to FERC on this important issue.
    The filing deadline for paper letters is March 11th, for electronically submitted comments March 18th.
    Below is an info sheet DMEA sent to members and organizations, including instructions on how to submit FERC comments.

    IMPORTANT MEMBER UPDATE:

    LOCAL RENEWABLE GENERATION AND ECONOMIC DEVELOPMENT THREATENED

    • What’s the issue? Last week, DMEA’s power supplier, Tri-State Generation & Transmission, filed a request with the Federal Energy Regulatory Commission (FERC). Tri- State wants FERC to approve a rate penalty on utilities like DMEA when they buy energy from local renewable projects.
    • What would this mean for Delta and Montrose counties? Tri-State’s rate penalty would make purchases from renewable sources uneconomical. This threatens not just local renewable generation, but also the tremendous economic development that comes with it.
    • Didn’t FERC already say DMEA must buy from local renewable sources? Yes. In a 2015 ruling, FERC said that DMEA must buy from renewable generation projects under a federal law called “PURPA” (the Public Utilities Regulatory Policy Act). Tri-State’s new request to FERC would essentially undo FERC’s 2015 ruling.
    • What is PURPA? Congress passed PURPA in 1978 to promote competition in generation and to support the development of local, renewable generation projects. PURPA requires utilities like DMEA to buy from local renewable generation projects (called “qualifying facilities”)—regardless of whether those purchases are permitted under the utility’s power supply contract (such as the one DMEA has with Tri-State).
    • What specifically is Tri-State requesting? Tri-State agrees that PURPA requires DMEA to buy from renewable generation projects, but wants to charge DMEA a penalty for revenue that Tri-State “loses” when DMEA buys energy from these projects instead of buying from Tri-State.
    • What is DMEA’s position on Tri-State’s request? DMEA believes that FERC regulations prohibit these “lost revenue” penalties under the type of partial requirements purchase contract that DMEA has with Tri-State. If FERC approves Tri-State’s penalty, it will stop any new renewable generation for DMEA members and will deprive our economy of jobs and millions of dollars in economic development.
    • Can organizations or members of the public comment on Tri-State’s request? Yes. DMEA encourages any person or organization wanting to communicate with FERC about Tri-State’s request for a lost-revenue penalty to send a letter. To submit a paper copy: mail two copies of a paper letter to Kimberly D. Bose, the FERC Secretary no later than March 11, 2016 to this address:The Honorable Kimberly D. Bose, Secretary Federal Energy Regulatory Commission 888 First Street, NE
      Washington, D.C. 20426On the subject line, please write “Re: Petition for Declaratory Order of Tri-State Generation and Transmission Association, Inc., Docket No. EL16-39-000.”Please also email a copy of your letter to Virginia Harman at DMEA virginia.harman@dmea.com.

      Unique letters (instead of form letters or “cookie cutter” letters) are most effective.

    • Can I submit my letter electronically? Yes. The Commission encourages electronic submission “eFiling” of protests and interventions in lieu of paper. To submit an electronic letter (e.g., a pdf of a letter) follow the instructions below:
      1. eRegister at https://ferconline.ferc.gov/eRegistration.aspx
      2. click on NEXT and fill in all three screens before clicking DONE
      3. Using your new username and password, eFile at http://www.ferc.gov/docs-filing/efiling.asp
      4. Choose the filing type “General”
      5. Choose subtype “Comment (on Filing, Environ. Report, or Tech Conf.)”
      6. Docket No. EL16-39-000

      Do NOT use the “eComment” webpage. You must use “eFiling” process.

      Please also email a copy of your letter to Virginia Harman at DMEA virginia.harman@dmea.com.

      For assistance with any FERC Online service, please email FERCOnlineSupport@ferc.gov, or call (866) 208-3676.

    • Questions? Please feel free to contact Virginia Harman at 970-240-1262 or virginia.harman@dmea.com.DELTA-­‐MONTROSE ELECTRIC ASSOCIATION P.O. Box 910, Montrose, CO 81402-­‐0910 Toll Free: 1-­‐877-­‐687-­‐3632 http://www.dmea.comDMEA is an equal opportunity provider and employer.If you wish to file a Civil Rights program complaint of discrimination, complete the USDA Program Discrimination Complaint Form, found online at http://www.ascr.usda.gov/complaint_filing_cust.html or at any USDA office, or call (866) 632-­‐9992 to request the form. You may also write a letter containing all of the information requested in the form. Send your completed complaint form or letter to us by mail at U.S. Department of Agriculture, Director, Office of Adjudication, 1400 Independence Avenue, S.W. Washington, D.C. 20250-­‐9410, by fax (202) 690-­‐7442 or email at program.intake@usda.gov.
  • #8333
    Ed Marston
    Ed Marston
    Member

    There are a few things to add to DMEA’s request for comments to FERC. I write as an 18-year veteran of the DMEA board.

    First, if DMEA and its 43 sister co-ops are permitted to self generate without limit, that will be very good for Tri-State Generation and Transmission Association. Tri-State is now locked into an all-past, no-future business plan. It is heavily dependent on an aging fleet of fossil fuel fired power plants, over its head in dept in the private bond market (about two years ago, it opted out of RUS financing), and is trying to force its diverse array of retail co-ops to blindly follow a one-size-doesn’t-fit-all plan hatched by a group of lawyers and bureaucrats.

    The only way out of this centralized approach is for TS to empower its co-ops to practice efficiency, load management, and distributed generation. Many TS co-ops, for example, are rich in falling water, blowing wind, sunlight and biomass. But instead of encouraging grassroots democracy and electrical self-reliance among its co-ops, TS tries to maintain a top-down, centralized planning approach reminiscent of the old Soviet Union.

    That’s the big picture for the four-state G&T. The smaller picture is what caused DMEA to take its case for local generation to FERC. Two years ago, one third of DMEA’s 110-MW load came from three large deeply underground coal mines that were producing 1.5 percent of the nation’s coal from underground mines with a collective workforce of 1,000 coal miners. Today, two of the three mines are closed and the third is in trouble. Roughly 700 jobs are already gone out of a two-county population of 35,000. They were the only well-paid jobs in our minimum wage area.

    DMEA’s territory is poor and aging. Its school population is declining. But it is rich in natural resources that can be turned into electricity, including methane seeping out of the closed and still operating coal mines (as much as 35 megawatts, although no one knows because there has been no prospecting), water falling one mile from the top of the Grand Mesa to the valley floor below, lots of sunlight, and hundreds of square miles of dying national forests.

    So, DMEA’s service area desperately needs the economic development that local generation could provide. It needs the construction and maintenance jobs, and it needs the taxes. And it needs to help its communities put its natural resources to work.

    The intersting thing here is that 80 years after its founding, DMEA is again seeking to act as the engine of economic progress in its two rural counties. Back in the 1930s, it was the Investor Owned Utilities that fought to stop rural economic progress. The IOUs did not want to serve the rural areas. But they didn’t want anyone else to serve them either.

    Ironically, now it is a Generation and Transmission Association that is fighting rural economic development in Delta and Montrose counties.

    Ed Marston
    Paonia, Colorado

  • #8334
    Dave Munk
    Dave Munk
    Member

    ACT TODAY – MARCH 17 DEADLINE FOR COMMENTS!

    Tony, thank you for bringing this important issue to the CLN audience. I filed comments as an individual Director (not representing my co-op or CLN) for the original FERC docket and will do so again on this follow-up action. I urge all readers to consider this issue and submit comments if you feel so inclined.

    CLN supports a vibrant and diverse dialogue among the co-op community. Add your voice!

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