Where the bison roam, the sun shines and the wind blows. Western states, including Colorado, New Mexico, and Wyoming, are reliable green power producers, but they lack east-to-west transmission and they don’t have a regional transmission organization (RTO) to manage the market.
Duane Highley, president and CEO of the Tri-State Generation and Transmission Association, which provides electricity to 42 members of the rural electric utility cooperative in those three states, as well as western Nebraska, wants to change things. He is on a crusade to build a new transmission and establish an RTO or connection to an existing one in the western grid. Nebraska, in the eastern grid, already benefits from the RTO of the Southwest Power Pool (SPP).
Highley told me in an interview, which took place partly in his office in Westminster, Colorado, and partly by telephone, that to take advantage of what is being accomplished with renewable energy, a more east-west transmission is essential with an RTO. The first to deliver electricity to and from the Intermountain region, and the second to provide day-to-day pricing for the electricity market and facilitate more efficient use of resources.
Tri-State is strongly committed to renewable energy and has made major progress in transitioning from coal. Last November, it reached 40% renewable energy used by its members. By 2024, the power supply they will use will be made up of 50% renewable energy. By 2024, it will supply them with 50% renewable energy. And by 2030, Tri-State estimates it will meet Colorado’s requirement of 80% carbon reduction, derived from a 2005 benchmark.
When Highley arrived at Tri-State in early 2019, he was under pressure to shift from his traditional base of coal and gas generation to more renewable energy. Working across state lines with utility commissions and governors, and with the help of former Colorado Governor Bill Ritter, Tri-State has developed a plan for the future titled the “Responsible Energy Plan.” . It was adopted in 2020.
Lower cost of renewable energy
Decarbonization goals have been helped by the falling cost of wind and solar power: Tri-State contracted more than 1,000 megawatts below 1.7 cents per kilowatt hour, Highley said. The low cost of renewable power generation is helping to ease pricing pressures, supporting Tri-State’s goals as it cut its wholesale price by 4%, at a time when neighbors were raising rates.
“The important message is that we have grown our renewable resource portfolio significantly over the past 11 years as the cost of wind and solar have come down significantly,” Highley said. “We have six large utility-scale wind projects and three solar projects in place today, with six additional solar projects coming online by 2024.”
One of Highley’s management’s first critical accomplishments was moving Tri-State from multi-state rate oversight to Federal Energy Regulatory Commission (FERC) jurisdiction, in recognition of its place as a supplier wholesale electricity in interstate commerce.
Tri-State has always had hydroelectricity in its renewable energy portfolio; the rest of its own energy comes from the wind and the sun. Although it has coal and gas, it will focus on wind and solar in the future. But Highley told me that renewables must have firm backup power, either from storage or gas – even if that backup requires building new gas turbines, de facto storage.
Like many Western power companies, Tri-State, a 3,000 megawatt system, was hit by winter storm Uri that crippled Texas last February. All three states emerged generally unscathed, largely due to the diversity of supply. “We even used fuel oil — yes, petroleum — in the combustion turbines to get through,” Highley said. Oil replaced gas which was selling for hundreds of times its normal price, he added.
Ideally, Highley would like to see the SPP expand north and west, even as the California ISO (CAISO) looks east. Otherwise, a new RTO will need to be created.
He told me that there was an urgent need in his territory for a daily rate system. This could be provided by affiliation with one of these neighboring markets.
The time zone resource
Highley also wants to exploit the difference between time zones to make better use of solar energy. This means a new transmission with more direct east-west connections. With regret, he points out that most transmissions – including in CAISO and SPP – are north-south. This does not benefit the renewable resource base in the Intermountain region.
“We want to get away from the canard curve that California and Arizona are struggling with,” Highley said. The duck curve is the effect of solar energy on a distribution system when too much energy is generated during the day and decreases at night.
Highley would like to see solar power flow east to deal with late-day surges in the Midwest and along the Atlantic coast. Likewise, when the sun rises in the east, the flow can be constructively reversed.
To store excess energy, Highley, who describes himself, befitting an engineer, as a “generator”, sees pumped storage as the winner both in terms of efficiency and drawdown time, which can take several days.
Lithium-ion batteries find little favor with Highley due to their rapid discharge, and it costs twice as much to shoot eight hours as four, and so on. “There are no economies of scale with these,” he said.
Highley added that in the Intermountain region there is a tremendous opportunity for pumped storage, which can be depleted over days. The hurdle is finding a lower reservoir, he said.
Likewise, he looks favorably on hydrogen, developed from the slowdown in wind and solar production when these resources produce a surplus of energy compared to the needs of the network. Highley thinks it could be stored as ammonia. “It’s much easier to store hydrogen as ammonia than to compress it,” he said.
Tri-State works with the Electric Power Research Institute on low-carbon research, including hydrogen, and we can be sure that its voice will be heard. Highley and Tri-State have unbridled enthusiasm for greening the future.