General Manager's message

Spring 2008

Renewable resources are part of our formula for success

J.M. Shafer

Executive Vice President/General Manager

Securing new generation resources, along with developing ancillary transmission paths to move power to load centers, has been a primary focus for most of the five years that I have had the privilege of serving as Tri-State’s general manager.  Since I will be retiring in the next few months, I won’t be around to see our efforts reach the "iron in the ground” stage.  However, I am confident that we have set the right course in assuring our members’ future power requirements will be adequately met with this strategy.

Our generation plans fall into three main categories:  (1) long-term baseload resources, (2) intermediate generation to provide backup and interim generation in advance of the long-term baseload projects and (3) ramping up investments in renewable power to meet state-mandated requirements and to respond to growing consumer interest in tapping into more green power options. 

First and foremost is our need to secure long-term generation facilities that will carry our membership through several decades of cost-competitive, reliable power using the best available control technologies.  To accomplish this goal, we continue to pursue our investment in the Holcomb Expansion Project and our long-term objective of developing the Colorado Power Project in southeastern Colorado.  Augmenting those resources will be several power purchase agreements we have secured with neighboring power suppliers.

To meet the growing energy needs of our membership between now and when the first baseload resources become available, we have secured intermediate power supplies that will reduce our exposure to higher-priced market power.  Toward that end, Tri-State’s board recently approved two 10-year purchase power agreements for natural gas-fueled combined-cycle facilities that will become available beginning in the summers of 2009 and 2010 respectively.  These intermediate resources also will help us integrate more green power into our system.  

For renewable energy, Tri-State is primarily focused on boosting our access to renewable resources to meet portfolio standards established in Colorado and New Mexico (as well as anticipated future mandates in Wyoming and Nebraska), enhancing our 10-year-old, voluntary renewable program and assisting member systems in developing local renewable projects.

Responding to renewable portfolio standard legislation in Colorado and New Mexico, the association issued a request for proposals (RFP) in December 2007.  The RFP calls for renewable energy deliveries of at least 150,000 megawatt-hours per year, which is roughly equivalent to a 50-megawatt wind farm with an annual capacity factor of 35 percent.  Bids also may include larger scale projects and any proven renewable technology, including solar or biomass.  Proposals are being reviewed this spring and the deadline for the first phase of operation is Jan. 1, 2011.

Effective Jan. 1, 2008, the voluntary renewable energy program, in place since 1998, was reduced in price to reflect prevailing market costs for renewable energy certificates.  This program offers 100-kilowatt-hour blocks of green power available for purchase by end-use consumers of Tri-State co-ops.  As of February 2008, a total of 5,608 100-kilowatt-hour blocks of renewable energy were being purchased by the consumers of 32 member systems.   

At local levels, Tri-State’s board has instituted policies that enable our member systems to develop renewable or distributed generation projects that meet up to 5 percent of their requirements and provide for local development that exceeds that 5 percent threshold.  Three member co-ops are developing green-power projects in their local communities that meet state renewable portfolio standards. 

In addition, Tri-State and our members are identifying and working with customers who have waste energy available as part of their industrial processes that can be captured and converted to electricity.

While green power facilities are a growing part of our resource mix, they still comprise a relatively small part of the generation necessary to meet our members’ increasing load requirements.  Our strategy is to continue to expand renewable sources of power as technological advancements lead to increased development of various types of resources, ultimately making these options more viable.  We believe that this is part of developing a balanced portfolio and an important component of our formula for success.