Study urges upgrade in West’s power grid – Without new lines, prices will be volatile

Without the addition of new transmission lines, electric utilities in Utah and other Western states increasingly will be forced to rely on natural gas-fired power plants to meet the growing demand for electricity, according to the Rocky Mountain Area Transmission Study group (RMATS).

By Steven Oberbeck
The Salt Lake Tribune

http://www.sltrib.com/business/ci_2420284

Organized by former Utah Gov. Mike Leavitt and Wyoming Gov. Dave Freudenthal, RMATS on Wednesday unveiled the results of its yearlong study that identified major additions to the transmission grid that could reduce reliance on natural gas, with its volatile prices, and enhance the movement of electricity throughout the region.

RMATS’ initial recommendations involve three projects estimated to cost nearly $1 billion.

They include:

* The addition of a new power line to allow additional electricity to flow between northwestern Wyoming and Colorado.

* Construction of a new transmission line originating in southeastern Wyoming that eventually would separate into two lines extending into Utah and Idaho.

* Upgrading an existing line that runs across Montana to enhance delivery of power to the Pacific Northwest.

Expansion of the electric power transmission system in the West is a critical issue for all states, Utah Gov. Olene Walker said. "We’ve ignored that critical resource for too long."

Yet the electric power industry in the West remains reluctant to invest in new transmission infrastructure.

"We can get new [interstate natural gas] pipelines built but we can’t get new [interstate electric] transmission lines constructed," said Nora Brownell of the Federal Energy Regulator Commission (FERC).

With natural gas pipelines there is one regulatory body – the FERC – that oversees the licensing process, Brownell explained.

The construction of electric transmission lines that skirt state borders is more problematic. Development can involve several states, each with their own set of regulations. And those differing regulations can make it hard for companies to feel comfortable that they will be able to recover their transmission line construction costs and earn a decent return.

"I can’t blame them," Montana Gov. Judy Martz said.

The RMATS group, which brought together regulators and utility representatives from Utah, Wyoming, Montana, Idaho and Colorado, is recommending that state public utility commissions strike an agreement that spells out how they will handle the allocation of multistate transmission expansion costs so that those interested in building new transmission lines will no longer have to deal with regulatory uncertainties.

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Balance of power A Colorado group’s study indicates most of the chronic problems of generating more electricity can be eased with a larger emphasis on renewable sources

By Claudia Putnam
for Headwaters News

http://www.headwatersnews.org/p.putnam060904.html

The Western Governors’ Association North American Energy Summit this year featured calls by New Mexico Gov. Bill Richardson and California Gov. Arnold Schwarzenegger to boost our region’s use of clean energy technologies and energy efficiency.

Our leaders are right to be worried. By 2020, population pressure in the Interior West is expected to drive the demand for enough new electricity to power five new cities the size of Denver. The question becomes not whether we will meet this growing demand for power, but how we will do so.

Despite the governors’ clarion calls, most of the proposals on the table today would use coal and natural gas to meet the bulk of this demand. However, such a “business-as-usual” approach will add unnecessary risks, costs and liabilities to the region’s economic picture, and it will affect electricity bills of the region’s electricity customers.

For the full story: http://www.headwatersnews.org/p.putnam060904.html