Settlement paves way for Western Washington to be free of coal power

Puget Sound Energy (PSE), the largest utility in Washington State, reached a proposed settlement today to pay down all of its debts on Colstrip by 2027. Initially the utility had planned to pay off the coal plant in 2045, but as coal continues to get more expensive compared to cleaner alternatives like solar, wind and energy efficiency, holding onto coal assets is getting harder to justify. The proposal is part of PSE's rate case process and still needs approval of the Washington Utilities and Transportation Commission.

Here are the basics of the plan:

• $10 million will be allocated to Montana for help transitioning the Colstrip community. Half this money is coming directly from corporate shareholders.

• The plan sets a schedule for PSE’s outstanding debt on Colstrip Units 3 &4 to be paid down by 2027. Utilities generally consider the end of debt payments as the end of useful life of an asset, meaning that this settlement would pave the way for PSE to end its coal use by 2027.

• PSE must provide annual updates on the economic viability of the plant, increasing transparency for Montana citizens who have dealt with uncertainty and mixed messages from the plant’s ownership over the years.

• The agreement allows PSE to begin setting aside money for cleanup of Units 3 and 4, and not just 1 and 2, putting the utility well ahead of the rest of Colstrip’s owners, most of whom have yet to plan for cleanup costs.

• Intervening parties who agree to this settlement  include: PSE, Washington State Utilities and Transportation Commission staff, Montana Attorney General Tim Fox, industrial customers, low income advocates, Sierra Club, the Northwest Energy Coalition, Renewable Northwest and the Natural Resources Defense Council.

This settlement points to the need for Montana to prepare for life after Colstrip. Montana has incredible clean energy resources that are largely untapped and could generate revenue and jobs for the state, while the power lines that once shipped coal power could easily be used to send the West Coast the clean energy it is demanding. We hope that this settlement will jumpstart a conversation in Montana about how to best position the state to take advantage of that growing demand for clean energy.

Mike Scott, Senior Campaign Representative with the Sierra Club issued the following statement:

“This settlement paves the way for Puget Sound Energy to withdraw from Colstrip in an orderly, well-planned manner. By acknowledging the rapidly declining demand for coal energy and providing funding for both transition and clean up, this agreement sets an example for the rest of the plant’s owners for how to transition to cheaper, cleaner energy without leaving the community of Colstrip behind.”