(PORTLAND, OR) – The Bonneville Power Administration and
Portland General Electric Company (NYSE: POR) have reached power purchase
agreements that will help fill a projected shortfall in PGE’s generating
capacity after 2020, when its Boardman Generating Station ceases coal-fired
operations. The agreements will bring additional clean energy – primarily
hydropower – to PGE customers while avoiding additional greenhouse gas
emissions in the Northwest.
“These agreements are a great opportunity for us to
collaborate with BPA to achieve shared goals in the region,” says Maria Pope,
PGE’s president and CEO. “This benefits all parties, making the most of
available clean, Northwest hydropower to serve PGE customers here in Oregon.”
“These contracts are an example of how BPA is working toward
greater cost competitiveness and capturing the additional value of the low
carbon, flexible federal resources by strengthening partnerships with regional
utilities as we collectively adapt to the rapidly changing energy environment,”
says Suzanne Cooper, BPA’s vice president of bulk marketing.
Under two five-year agreements beginning in January 2021,
BPA will offer to sell PGE up to 200 megawatts of surplus clean hydropower
generated from the Federal Columbia River Power System. At any given moment,
that’s enough electricity to power approximately 160,000 Northwest homes.
Negotiations between BPA and PGE began after BPA responded
to an inquiry from PGE seeking access to existing regional generating
resources. With the encouragement of the Oregon Public Utility Commission and
other stakeholders, PGE reached out to BPA and other regional power generators
last year as part of its integrated resource planning process to see if its
need for additional on-demand generating capacity could be met without
committing in the near-term to construction of new power plants.
In addition to allowing BPA to take advantage of a new
opportunity to market its clean, flexible hydropower and generate direct
revenue as part of a broadening portfolio of power products, the contracts
allow PGE more time for new dispatchable resource technologies to mature to
help the company integrate increasing amounts of renewable power onto its
system. Dispatchable resources like hydroelectricity can help the region
achieve its renewable goals by dovetailing with variable output resources like
wind and solar to meet load swings.
"This is a great deal for the region. It's a
value-added product for the federal power system and a good alternative for
PGE. It puts off big new investments in gas that would have locked PGE and its
customers into fossil fuels for decades," said Bob Jenks, Oregon Citizens’
Utility Board’s executive director.
“Instead of building new carbon-emitting resources, PGE is
able to take advantage of existing clean hydropower, and BPA is able to lock in
a future sale to help strengthen its financial health,” said Wendy Gerlitz, NW
Energy Coalition’s policy director. “This deal is a win-win for the Northwest.”
While the power supplied to PGE’s system from BPA will come
primarily from federal hydro projects, it will not count toward Oregon’s
renewable portfolio standard, which requires PGE to serve 50 percent of its
customers’ demand for power from qualifying renewable generating resources by
2040. Qualifying resources are generally facilities that began operating after
1995. Counting both qualifying resources
and its owned and contracted carbon-free hydroelectric resources, PGE expects
its energy mix to be at least 70 percent carbon free by 2040.
Separately, PGE is preparing to issue a request for
proposals later this spring, seeking an additional 100 average megawatts of
qualifying renewable power resources to help meet the state’s renewable energy
requirements and continue reducing carbon emissions from its system. The
company held workshops in Portland on March 2 for stakeholders and potential
bidders to provide input before the RFP is finalized. If bids received prove
cost-effective for service to customers, whether power purchase agreements or
ownership options, PGE expects the resources acquired to be brought into the
company’s portfolio in the 2020-2021 timeframe.
