Changes to the public-private partnership between power marketing administrations (PMAs) and their customers should not be made without due consideration of affected stakeholders’ concerns, 166 members of Congress told Energy Secretary Steven Chu June 5.
In a March 16 memorandum to the PMAs, Chu noted his intention to direct the PMAs to act in areas involving transmission expansion, renewable energy, energy efficiency, cyber security and electric vehicles in order to ensure a modern, secure and reliable electric transmission grid, according to the letter to Chu from the members of Congress, led by Natural Resources Committee member Rep. Paul Gosar (R-Ariz.), Rep. Jim Matheson (D-Utah) and Sens. Orrin Hatch (R-Utah) and Tim Johnson (D-S.D.).
In his memo, Chu praised the PMAs’ work in implementing the DOE’s goals, but said, “we can all do better.”
He noted that over the years, the rights and responsibilities of three PMAs, including the Bonneville Power Administration (BPA) and Western Area Power Administration (WAPA), have expanded beyond selling energy from federal dams. For instance, BPA and WAPA buy energy from non-federal generators on behalf of their customers and they have revolving loan funds for expanding the country’s transmission grid.
Chu said he will direct that each of the PMA’s strategic plans and capital improvement plans recognize the electric sector’s changing nature, including complying with NERC reliability standards, integrating variable resources and centralizing dispatch.
He also said he is directing the PMAs to create rate structures that incentivize energy efficiency programs and demand response programs, among others.
Furthermore, Chu said he directs the PMAs to continue to look for ways to strengthen relations with other owners and operators of the grid and grid components, including coordinating operations with neighboring balancing authorities.
Among other things, he said he is directing the PMAs to capture economies through partnering with others in planning, building and operating the grid.
“While these are important public policy goals, we are concerned that these new initiatives have been put forward without sufficient evaluation of potential impacts to the customers of the clean, reliable electricity marketed by the PMAs,” the members of Congress said.
They said they have heard from numerous public power utilities, rural electric cooperatives and local officials who are troubled by the potential cost impacts of those directives and by a perceived expansion of the role of the PMAs beyond their current statutory authority.
“These proposals also constitute a fundamental shift away from regional planning, and the understanding of local needs and impacts which comes with it, towards a Washington, D.C.-based, top down approach,” the members of Congress said, adding that they are concerned that the U.S. Department of Energy (DOE) appears to be sidestepping Congress’ role in debating and overseeing policies relating to the PMAs.
The members of Congress noted that the PMAs have marketed federally generated hydropower for decades to about 1,100 electric utilities in 34 states, and have built and maintained thousands of miles of high voltage transmission systems to deliver this power. Through a partnership with their customers, the PMAs repay the federal investment in these systems with interest annually.
“The federal power program is integral to keeping electricity rates affordable and reliable for the customers of community-owned and customer-owned utilities across the states we represent,” the members of Congress added. “We strongly urge you to pursue meaningful collaboration with stakeholders, including ratepayers and Congress, prior to moving forward with these new initiatives.”
Their letter follows an April 11 letter sent to Chu by 19 members of the Pacific Northwest Delegation, who said no actions regarding the memo should move forward until DOE can show that it has worked within a robust, transparent and public process with stakeholders, including members of Congress and ratepayers.