RMI pats Tri-State on back, describes it as a model for other G&Ts

Highly critical of wholesale supplier’s reliance of coal in 2018, think tank now points to big pivot

by Allen Best

Another piece of evidence about the big pivot underway in energy comes from Rocky Mountain Institute, which in early May issued a case study lauding Tri-State Generation and Transmission. The study, Tri-State Chooses the Low-Carbon Path, describes Tri-State it as a model for other G&Ts in the country still heavily immersed in carbon-based generation.

For this report, RMI had access to senior executives. How different than in 2018 when RMI was researching a report that was issued that August. That report found that of all the coal-burning units that supplied the 43 member cooperatives of Tri-State Generation and Transmission, only one— Laramie River Station, at Wheatland, Wyo.—produced electricity at lower costs than the renewables then available.

When I broke that story in 2018, I interviewed Mark Dyson, one of the two principal authors. He said that he got very limited cooperation from Tri-State. I did not talk to Tri-State before writing that story, but The Denver Post, coming out a few days later, did, and Tri-State said that RMI’s report was based on incomplete data.

A few months later, at the Colorado Rural Electric Association, the then-CEO of Tri-State, Mike McInnes, explained Tri-State’s sluggish embrace of renewables during his tenure. Tri-State, he explained, didn’t want to be part at the spear tip of energy innovation.

“It’s just not in my DNA,” he said. Tri-State’s strategy, he added, was to wait until technology was better proven. “We can come in and provide a much better product and become much more flexible as our rates go.”

This is from Big Pivots No. 11 (5.25.2020). To be on the distribution list, send you e-mail address to [email protected]

But according to the recent RMI report, even in 2018 Tri-State had begun laying out a new path. The upshot of that new path was unveiled in January 2020 by Duane Highley, who replaced McInnes in April 2019.

Tri-State plans to close its coal plant in New Mexico this year and its plants at Craig from 2025 through 2030. It expects to add 1,000 megawatts of new wind and solar generation by 2024, and likely more beyond that.

See: Tri-State CEO says wholesaler’s clean transition will pay dividends

As a result of this generation shift, Tri-State expects to reduce emissions from its Colorado wholesale electric sales 70% by 2030, in line with state carbon regulations, the RMI report says.

RMI’s report dips into the question of debt, if only briefly. It says that in preparing its Responsible Energy Plan, Tri-State needed concrete targets as well as a “clear plan for dealing with the debt that remains tied up in existing generation assets.” What that plan is, the RMI report does not say. It seems to be the elephant in the room, one barely touched upon by my reporting and that of others.

In lauding Tri-State, the RMI report by Dyson and Katie Siegner, also glosses over continuing quarrels with two of its three largest members. It accepts the supposedly new “flexible” generation plan adopted in April at face value. United Power and La Plata Electric, as reported in Big Pivots No. 8, certainly do not. They say it is anything but flexible.

See: Why Tri-State’s new policies don’t work for these two dissident members.

The report identifies a major challenge for Tri-State going forward being the need for transmission, which currently takes 8 to 12 years.

The RMI analysts credit Tri-State’s willingness to engage with outside stakeholder groups through Bill Ritter’s Center for the New Energy Economy.

Also noted was Tri-State’s decisions early on to create a specific plan to decarbonize its power generation rather than adopt aspirational targets. Keep in mind that this planning process was both before and after Colorado and New Mexico adopted broad and deep greenhouse gas targets in their 2019 legislative sessions.

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