PacifiCorp is moving forward with a 20-year plan that reduces its use of coal-fired power while expanding investments in wind energy.
The utility, which serves customers in six Western states, has proposed spending $3.5 billion on a plan to add 1,100 megawatts of new wind energy — mostly in Wyoming — as well as a new transmission line.
The plan will also re-power wind turbines in the Columbia River Gorge by adding bigger turbine blades and upgrading equipment inside the turbines to increase their energy output by an average of 20 percent.
PacifiCorp currently gets nearly 60 percent of its electricity from coal-fired power plants in Rocky Mountain states, but several of those plants are scheduled to be mothballed in the next 20 years. By 2036, according to the utility’s new plan, coal will make up 31 percent of the company’s energy mix. Over the same time, wind and solar will grow from 15 percent today to 22 percent.
"It is pretty dramatic," said PacifiCorps spokesman Bob Gravely. "But a lot of these plants were built in the '70s and '80s, and they’re reaching the end of their life anyway. The decision is: Do you make significant investments to extend the life or do you let them retire at the end of their lives and replace the power with other resources?"
Natural gas will make up a 30 percent of the utility’s energy mix by 2036, up from 14 percent today. That's in large part because the utility doesn't plan on retiring any of its existing natural gas plants, Gravely said.
A lot of the investment in wind energy is designed to be completed before federal production tax credits expire at the end of 2020. The tax credit offers 2.4 cents per kilowatt hour for energy produced from wind turbines for 10 years. Gravely said the credits will help offset the costs to customers of building new wind farms.
Gravely said states’ renewable energy requirements and the rules in the Obama administration’s Clean Power Plan that aim to reduce carbon emissions were taken into consideration while developing the plan. But the economics of clean energy tax credits were the biggest factor in the company’s decision to invest heavily in wind energy.
“We’re really pushing to do it by 2020,” he said. “If we’re able to qualify for production tax credits, regardless of what’s happening in the administration or at the state policy level, we would be doing this because it’s the most economical way to meet our energy needs.”
The plan also includes covering 80 percent of the utility's expected growth in electricity demand through improvements to energy efficiency.
Utility regulators in multiple states are reviewing the plan, but have not yet weighed in.