The agreement follows negotiations with the backers of a proposed ballot measure that set the same target for eliminating coal from the state’s electrical supply.
The proposed legislation would only affect Pacific Power and Portland General Electric, which together serve about 70 percent of Oregon’s electricity. It also calls for doubling the amount of renewable energy the utilities generate by 2040.
Bob Jenks, director of the Oregon Citizens Utility Board, worked alongside several environmental groups to negotiate the agreement.
“I think the ballot measure clearly had an impact on the utilities thinking they wanted to avoid what would be a pretty ugly fight,” he said. “Phasing out coal and replacing it with renewables is fairly popular with the voters.”
Jenks said the agreement allows the utilities more flexibility in the timeline for phasing out coal. It allows Portland General Electric a little more time – until 2035 – to eliminate coal-fired power from the Colstrip plant in Montana if the other owners refuse to shut it down. It also maintains a cap on the cost of renewable energy.
The deal will ultimately need approval from the Oregon Legislature.
It would increase the state’s renewable energy standards to 50 percent by 2040, and it would stair-step up over time to 27 percent by 2025, 35 percent by 2030, and 45 percent by 2035.
“The end of the timetable is still the same as the ballot measure,” said Jenks. “But the flexibility between now and that end has increased so things can be done potentially on a slower timetable up front.”
Scott Bolton, spokesman for Pacific Power, said the more flexible timeline will allow his company to phase out coal-fired power when it makes the most economic sense and replace it with with renewables as the cost of renewable energy comes down over time. That will minimize the need to raise electricity rates, he said.
“We can meet the state’s climate and environmental goals if given the space as a business to come up with the best plan to achieve that,” Bolton said. “That’s what you can get in these negotiated agreements that, frankly, are lost when they’re fought out through ballot measures.”
PacifiCorp owns more than a dozen coal-fired power plants, mostly in the Rocky Mountain region. The proposed bill couldn’t force any of the utilities to close their coal plants – only to stop selling their power to Oregon ratepayers. However, many PacifiCorp plants are already on track to reach the end of their useful life within the next 15 years or so.
Bolton said the agreement is a rare example of utilities and environmental groups working together – and that should help get the bill through the Legislature.
“Some of these folks we’ve never worked with before, so it is actually exciting to find some common interests,” he said. “You don’t see PacifiCorp and Sierra Club on the same letterhead very often.”