An interesting article from the Idaho Statesman:
Is Idaho Power ready to adopt renewable energy? Idaho Power thrived when low cost was king and coal and hydropower kept prices down. But climate change and the push for greener power have changed the game.
BY ROCKY BARKER - rbarker@idahostatesman.com Edition Date: 02/15/09
http://www.idahostatesman.com/273/story/668884.html
Idaho Power was once so powerful that the joke was the state itself was named after the company.
For decades it could dictate its own terms of doing business - and in the era of hydro and coal, Idaho Power's low energy prices made sure no one minded.
Until as recently as 2007, Idaho Power was confident it could meet its growing demand by expanding coal facilities in Wyoming. But the threat of climate change, rising metal prices and efforts to reduce greenhouse gases all but dried up the capital markets used to build new coal plants.
Almost overnight, the company that provides electricity to more than 500,000 homeowners, businesses and farmers across southern Idaho and eastern Oregon has had to adjust to a world where fossil fuel-based electricity will no longer be cheap and federal government policy increasingly favors renewable energy sources like wind, geothermal and solar.
The company's customers, regulators and Idaho's political establishment haven't changed their expectations of cheap power. But Idaho Power has to change - or risk being left behind.
"Important energy and environmental policy reforms are affecting just about every aspect of our business model," said LaMont Keen, Idaho Power's CEO and president. . .
The 93-year-old company now is trying to build new transmission lines, a new natural gas plant and more renewable energy - all while trying to get its customers to reduce how much power they use. . .
Even proposed transmission lines - required to tap into low-cost renewable energy available in the Pacific Northwest - are being opposed by landowners in Oregon and western Idaho. . .
Last month, the Idaho Public Utilities Commission allowed Idaho Power to hold on to renewable energy credits - so-called "green tags" - that it could sell to other utilities.
Idaho Power's industrial customers wanted the utility to sell the credits and use the money to reduce its rates, but the company wanted to keep them in case Congress, to reduce greenhouse gases, passed a "cap and trade program" that would restrict future power development and make these tags even more valuable. . .
NO CHOICE BUT NATURAL GAS
Idaho Power still needs what is called baseload generation - power that is available all the time, said Jim Miller, Idaho Power's senior vice president for power supply.
The company is expected to announce plans soon to either build a natural gas generation plant or buy power from another company. . .
And because the utility is so powerful here, Idaho Power's past attitude toward renewables largely became the state of Idaho's position.
For instance, surrounding states all have "Renewable Portfolio Standards" that require their utilities to have a set percentage of renewable electricity.
These standards are encouraging renewable industries in these states, and they also require utilities to develop renewables no matter the cost to ratepayers.
Idaho Power successfully killed attempts several years ago to pass similar standards in Idaho, and there is no serious effort in the Legislature to push them now.
Idaho still offers far fewer incentives for developers and individuals to build or install renewable electric systems than surrounding states.
But the company is changing.
"Traditionally, it's always been their way or the highway," said Pat Sullivan, a lobbyist who was a U.S. Senate Energy and Natural Resources Committee staffer under former Idaho Sen. James McClure. "But today you have a new breed, more willing to work things out."
Sullivan says it appears from the outside like there's an internal culture war within Idaho Power's walls. Some inside the company are sending lawmakers mixed signals, he said.
"The energy picture in the Northwest and the U.S. is changing, and they're going to have to change, too," Sullivan said.
(Paul) Kjellander (director of Gov. Butch Otter's Office of Energy Resources), said Keen, a 34-year veteran of Idaho Power who became CEO in 2006, is largely responsible for turning the company around.
"What we saw was a sea change," Kjellander said. "There was much more openness in terms of dialogue than there was before."
IDACORP CHIEF'S VIEWS ON CLIMATE CHANGE, ALTERNATIVE ENERGY
IdaCorp CEO LaMont Keen talked about climate change and other issues with the Statesman's Rocky Barker. . .
Q: Do you think there might be ways to reduce the conflict over transmission?
A: In the long run it is a positive thing, and I think most people agree theoretically with that. The dilemma comes when practically the line is running someplace near you or where you can see it. Then it becomes more than something in the abstract, it becomes a reality about how it's going to impact a given person. And here in the West, it's sparsely settled, but the lines are longer. I think we would be a little remiss if we didn't anticipate some resistance. Are there ways we can maybe do things better and interact sooner with communities? Probably so, and we are certainly going to make a renewed effort to that. With regard to transmission in a number of areas, we were able to get out in front of it and react with business leaders. We missed a couple of bases in western Idaho and eastern Oregon right now, so we are rethinking how we do that. And there may be ways, alternative ways, to get the line built. At the end of the day, it shows it's not going to be easy to get 300 miles of line built.
Once again, we want to make clear to the Idaho Statesman that residents of Western Idaho and Eastern Oregon do not oppose transmission lines, but only the placement of them through private rather than public lands. We have proposed alternatives that meet Idaho Power's stated objectives and we hope that LaMont Keen's dedication to "alternate ways to get the line built" will be acceptable to the greatest number of people possible
