Colstrip owner commits $3 million to economic transition away from coal

Avista Utilities would commit at least $3 million to assist in economic transition for the community of Colstrip and would no longer support investments that would extend the life of the plant past the end of 2025, under the terms of a proposed settlement in the company’s rate case before the Washington State Utilities and Transportation Commission.

If approved by the Commission, the proposed settlement would ensure that Avista ratepayer funds aren’t being used for capital investments that prolong the life of the plant past December 31, 2025, the date by which Avista must be coal-free under Washington State’s recently passed 100 percent clean electricity legislation.

Full terms of the proposed settlement available HERE.

The settlement includes multiple provisions that limit financial risk to Avista ratepayers and provide benefits to help the community of Colstrip prepare for the plant’s closure. These include:

• No more support for capital investments in the plant that extend the life beyond the end of 2025. Avista must provide detailed reporting to the state utility commission on related costs and decision making.

• $3 million for Colstrip community transition available April 2020, with half coming from shareholders and half from ratepayers.

• At least $33 million for Colstrip decommissioning and reclamation costs, which could include clean up of coal ash ponds. Avista must provide reports to the utility commission on the true costs of cleanup, which are estimated to be upwards of $700 million between all owners.

• Increased investments for low-income Avista ratepayers, including $3 million for weatherization, support for increased investments in electric vehicle chargers, and a plan for limiting billing-related disconnections and a commitment to explore renewable energy for low-income households.

Avista’s $3 million commitment to Colstrip transition follows Puget Sound Energy’s contribution of $10 million, along with more than $2 million in federal grants. To date, no other Colstrip owners have contributed to the Colstrip transition fund.

Spokane-based Avista serves approximately 350,000 electricity customers in Eastern Washington and Northern Idaho. The utility owns a 15 percent share of Colstrip Units 3 and 4.  The remaining owners include Puget Sound Energy, Portland General Electric, PacifiCorp, Talen Energy and Montana-based NorthWestern Energy, which predicts the plant will run until 2042 in its most recent long-range plan. Together, the plant’s owners spend tens of millions of dollars per year on operations, maintenance, new capital and debt at the plant. Talen and Puget Sound Energy, which own Colstrip Units 1 and 2, announced earlier this year that those two units would close more than two years earlier than expected due to escalating fuel and operating costs.

Separately, the UTC will conduct an investigation into replacement power costs that Avista Utilities, Pacificorp (Pacific Power), and Puget Sound Energy incurred when Colstrip was unexpectedly shut down for more than two months in 2018. More information can be found HERE.

Mike Scott, Billings-based Senior Campaign Representative for the Sierra Club, issued the following statement:

“By working towards transition for Colstrip, Avista is providing an example for other Colstrip owners like Northwestern Energy and Talen Energy. Colstrip owners spent decades using the resources of Eastern Montana, now it’s time for them to clean up the toxic mess they left behind and help the community find a new economic future.”