Tri-State Generation and Transmission Association released a statement on Tuesday indicating its move to become regulated by the Federal Energy Regulatory Commission (FERC).
This decision has drawn harsh criticism from Colorado legislators and Delta-Montrose Electric Association (DMEA). Democrat state legislators are urging Tri-State to slow down and reconsider the decision, since it was only two months ago that the legislature passed a bill (SB19-236) that requires Tri-State to submit its energy resource plans to the Public Utilities Commission (PUC). According to Tri-State’s statement, FERC regulation will not affect how it complies with Colorado’s carbon reduction and renewable energy regulations. However, according to Bloomberg Environment, Democrats are concerned about the potential for FERC regulation preempting it from the state’s carbon emission goals.
Delta-Montrose Electric is concerned and upset about how FERC regulation will impact its decision to separate from Tri-State. Jasen Bronec, CEO of DMEA, said in a press release that he believes Tri-State’s decision to pursue FERC oversight is simply a way to undermine DMEA’s separation case before the PUC. After all, if Tri-State is successful, DMEA’s separation case will have to start over and be heard by federal officials. DMEA has filed a temporary restraining order in Adams County District Court to try and stop Tri-State from getting out from under PUC jurisdiction.
Criticisms aside, Tri-State has a fiduciary duty to its members, and its desire for stable rates isn’t unwarranted. Colorado has decided to relentlessly pursue progressive environmental policies. Democrat leadership in the Senate, House, and Governor’s Office have made reducing carbon emissions a major priority. So much so, they were willing to codify Xcel Energy’s plan to reduce its carbon footprint 80 percent by 2030 and 100 percent by 2050, scorning at the idea that the Public Utilities Commission is a neutral governing body.
In the past, Tri-State was exempt from FERC oversight because it was wholly owned by electric cooperatives. However, at the board meeting in July, Tri-State executives decided to incorporate new members that will eliminate its federal oversight exemption. Chairman Rick Gordan made it clear that he believes members will benefit immensely from the efficiency gained by a single rate regulator (i.e., FERC), and that the utility will continue building a cleaner generation portfolio.
The Coalition of Ratepayers remains committed to supporting DMEA’s desire for autonomy. However, we also believe Tri-State has a right to self-determination as well.
If DMEA is upset with Tri-State, maybe it should shift its gaze to the Gold Dome and Colorado’s regulatory agencies. Democrats made sure Tri-State knew it was under scrutiny and amended SB 236 to ensure it would be regulated by the PUC. Moreover, the PUC made sure that Tri-State understood that even if Democrats failed to pass legislation authorizing oversight, it would start scrutinizing and looking into the wholesale power supplier’s business dealing on its own.
This is the background information often overlooked or disregarded when criticizing Tri-State for wanting to be regulated by FERC. Time will tell whether FERC oversight impacts Tri-State’s compliance with Colorado’s carbon emission reduction goals and clean energy regulations. But one thing is for certain, Tri-State decided to chart its own course and stand up to those Colorado Democrats ramming through progressive environmental bills. As a wholesale power supply cooperative serving members in four states, it should be able to decide the course of action that serves its interests the best. And for that, the Coalition of Ratepayers applauds Tri-State’s decision to move forward in pursuing FERC oversight.