Puget Sound Energy, the largest utility in Western Washington, is negotiating an extension to its coal supply contract that could extend the life of the Colstrip Power Plant in Eastern Montana, despite persistent calls from its customers to move away from fossil fuels.
Public documents filed with the U.S. Securities and Exchange Commission (SEC) indicate that the current contract for the Rosebud Mine, which is the sole fuel source for the nearby Colstrip plant, the eighth-largest source of climate-changing carbon dioxide emissions in the United States, expires in 2019.
As with other aging coal plants across the West, mounting environmental cleanup costs and the dropping price of cleaner energy sources have made Colstrip economically uncompetitive. Talen Energy, the plant’s operator, recently told the Montana state legislature that the company was losing close to $30 million a year operating the plant.
PSE agreed last year to retire two of the four coal-fired units by no later than 2022 but has yet to commit to a retirement date or transition plan for the final two units, of which it owns 25 percent. King County, which makes up more than half PSE’s customer base, has called for no coal-fired power past 2025. PSE’s fossil fuel-heavy energy mix recently led the utility’s largest corporate customer, Microsoft, to bypass PSE to secure its own clean energy. Nearly 70 percent of PSE’s customer base has indicated through their elected city or county councils that they don’t want any more coal. Despite customer demand and market forces quickly making coal obsolete, PSE plans to charge ratepayers for debt payments on the plant through 2035 and has no set date for retirement.
Typical coal contracts for plants like Colstrip can include terms as long as 15 years or more. A contract that long could bolster the case to expand the Rosebud mining operation, which has already caused extensive environmental damage, and extend the life of one of the largest, dirtiest coal plants in the American West. Westmoreland Coal Company, which owns the Rosebud Mine and is facing the threat of bankruptcy, is seeking to expand the mine, despite the fact that they have yet to fully restore the 25,000 acres they already strip-mined in the area as required by state law. The documents also show that the Rosebud mine only has enough coal under permitted areas to last through 2024.
Cesia Kearns, Western Deputy Campaign Director for the Sierra Club’s Beyond Coal campaign, released the following statement:
“Puget Sound Energy has long touted itself as a clean energy leader despite an energy mix that is nearly 60 percent fossil fuels. This is an opportunity for PSE to walk the walk and speed the transition away from fossil fuels and towards the clean, renewable energy that its customers are demanding. With the federal government in the hands of fossil fuel executives, it’s time for bold local action to combat climate change in the Pacific Northwest, not life support for a dying, wasteful coal plant.”
Doug Howell, Senior Campaign Representative for the Sierra Club’s Beyond Coal campaign, issued the following statement:
“Puget Sound Energy is considering signing their customers up for years of coal at a time when coal plants are closing right and left and renewable energy is getting cheaper by the day. If PSE is really looking out for its customers' interests, they will pursue a short term agreement that gives flexibility for ending coal purchases when the time is right. That way ratepayers aren't stuck paying for coal they don’t want or need. Washington families are counting on PSE to make the right choice.”