Big Pivots roundup Nov. 20

Peabody says it intends to stick around Wyoming, but economist skeptical

GILETTE, Wyo. – Arch Resources, the second biggest operator of coal mines in Wyoming’s Powder River Basin, plans to get out. Peabody Energy, the largest, says it plans to continue to make itself at home.

Don’t necessarily believe it, a University of Wyoming energy economist tells WyoFile.

“I don’t think they’re going to hang around that long,” Rod Godby speculated in an interview with Wyofile’s Dustin Bleizeffer. “The question is just timing: What’s the best time to divest? You don’t want to look like a motivated seller. And this is the Powder River Basin today.”

Bleizeffer reports that Peabody’s third-quarter report showed a 39% decline in revenue from July through September. This reflected declining revenues of $215 million from the company’s U.S. operations of mines that deliver coal to power plants. It has three major mines in Wyoming, all south of Gillett.

Arch Resources plans its exit after a court ruling that upheld the Federal Trade Commission’s opposition to merging Arch and Peabody operations in the West. That affects operations of Colorado’s Twentymile Mine, near Steamboat Springs.

Arch’s Black Thunder Mine and Peabody’s adjacent North Antelope Rochelle mine, the two largest coal mines in the nation, account for two-thirds of production in the Powder River Basin.

See the full Wyofile story.

Top: A coal train awaits its turn to go south near Bill, Wyo., in 2011. Photo/Allen Best

San Francisco bans new natural gas lines for buildings as of June

SAN FRANCISCO – Supervisors of San Francisco have banned natural gas lines for new buildings beginning in January. The ban affects more than 54,0000 houses and 32 million square feet of commercial space that are planned, the San Francisco Chronicle reported.

Nearby Berkeley launched the movement to ban natural gas in 2019. Since then, 39 jurisdictions have joined it as well as several others. While there are health and safety advantages in replacing use of natural gas in buildings with electricity, the primary driver has been reduced greenhouse gas emissions. Natural gas is the second-largest source of emissions in San Francisco.

No jurisdictions in Colorado have banned natural gas. To thwart such a possibility, the Colorado Oil and Gas Association had planned to put a proposal before voters that would ban just local actions. But an agreement was reached to pull it back. However, Arizona, Tennessee, Oklahoma, and Louisiana all passed such laws prohibiting local governments from adopting electrification measures or natural gas bans.

These are items from the Nov. 20, 2020, issue of Big Pivots. Subscribe at BigPivots.com

Arizona adds storage requirement to the must-do list of utilities

PHOENIX – In some ways, Arizona seems to be following in the steps of Colorado and other states with a new standard adopted by the Arizona Corporate Commission, the agency that regulates investor owned utilities.

The new standard requires electric utilities in Arizona to reduce carbon emissions 50% by 2030 and 75% by 2040 before reaching complete decarbonization by mid-century.

But Arizona has also broken new ground in several areas, including a policy lever to drive the deployment of more than 200 megawatts of customer-owned or leased energy storage systems by 2035. That’s the equivalent of 40,000 home battery storage systems.

Ellen Zuckerman

It’s the first of its kind in the United States, says Ellen Zuckerman, co-director, of Southwest Energy Efficiency Project’s utility program.

The new energy efficiency standard puts efficiency on an equal footing with the investments utilities make in other energy resources. It requires efficiency investments be “prudent” as other utility investments are required to demonstrate.

There’s a component of Just Transition in the new standards. They require that integrated resource planning process include provisions for favorable siting for renewable energy in fossil fuel impacted communities.

“This is an important signal that the Commission takes just and equitable transition seriously as the overall transition to clean energy is instituted,” says Zuckerman. She also points out that the rules were adopted by a commission comprised of three Republicans and one Democrat.

Please recommend Big Pivots to those interested in Colorado’s great transition in energy.

Solar projects move ahead in northwest New Mexico as coal retirements near

FARMINGTON, N.M. – A company hoping to develop more than 1,300 megawatts of solar in northwestern New Mexico has reported clearing milestones to enable to it do so.

The Farmington Daily Times reports that Photosol US, a subsidiary of a French company, has been working to develop 600 megawatts of solar with 300 megawatts of storage at the San Juan Generating Station and another 360 megawatts of solar nearby plus 400 megawatts at the Navajo Mine. A project representative projected that solar farms will become operational between 2022 and 2024.

Two of the units at San Juan Generating Station were retired in 2017, and the remaining two are expected to be closed unless a new owner figures out how to keep them operating.

PNM, New Mexico’s largest utility and the primary owner of San Juan Generating Station, will sell the plant to the city of Farmington, a minority owner. Farmington then plans to transfer the plant to Enchant Energy.

Enchant Energy plans a carbon-capture and sequestration project, putting carbon dioxide exhausts into a pipeline for use in the Permian oil basin of Texas and eastern New Mexico. The U.S. Department of Energy has agreed to provide a $25.4 million boost, but the entire project carries with it a $1.4 billion price tag, an op/ed in the Albuquerque Journal points out.

The federal agency provided $250 million to a previous carbon-capture plant in Texas that was shut down. It is among several major subsidies for carbon capture projects involving coal plants.

Clash between rooftop solar in Utah and desire of utility for big solar farms

SALT LAKE CITY – Rocky Mountain Power, the primary electrical utility in Utah, has been moving to renewables. But it plans to get most of that electricity from utility-scale projects and by tapping the surplus generated by California.

At issue is a ruling by the state’s Public Service Company that the solar industry fears will result in a significant contraction. The state commission lowered the credit the utility awards its customers for the excess electricity they generate from rooftop panels and exports onto the grid.

The 350 megawatts generated on Utah roofs pales in comparison with the 7,000 megawatts the company plans to get by 2023 from solar farms now under development, according to Ryan Evans, executive director of the Utah Solar Energy Association. Evans tells the Salt Lake Tribune that only 2% of Rocky Mountain Power’s customers in Utah have roof-top solar, leaving plenty of room for growth.

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