Committed to a Cleaner Energy Future

By Jim Piro, president and CEO

April 26, 2017

For more than 125 years, we’ve proudly championed a vibrant Oregon. We are deeply committed to helping our communities prosper and connecting our customers to innovative solutions they can depend on to energize their changing lives.

We also know our customers care passionately about the environment. And we share this commitment with our customers. In fact, we have members of the community in our plaza today expressing how much they care about where their energy comes from. We welcome their input as we plan for Oregon’s energy future.

Together with the communities we serve, we’ve taken a leadership position on sustainability and — over the years — have demonstrated ourselves to be early pioneers. In addition to having the number 1 voluntary renewable energy program in the country, we’re paving the way for a carbon-free future by:

  • Integrating more renewable energy by joining the Western Energy Imbalance Market
  • Advocating for electric transportation — which can significantly reduce greenhouse gas emissions; and
  • Ending the use of coal at our Boardman plant by the end of 2020.

Just this month, we started working with the City of Portland and Multnomah County to build a strategy in pursuit of their Clean and Renewable goals. We’re working with the City to outline how we can potentially help them meet these ambitious goals while maintaining the reliability and affordability of electric service to our customers.

Our employees share our region’s commitment to environmental stewardship and sustainability, as demonstrated by our 2016 performance results. They work every day to provide safe, reliable, affordable and sustainable energy to our customers.

For example, in 2016 we collaborated with environmental groups as well as customer advocates to pass one of the most progressive clean energy laws in the nation. The resulting legislation — the Oregon Clean Electricity Plan — puts our state and PGE on a path to 50 percent renewable energy by 2040 and discontinues delivery of energy from Colstrip Units 3&4 by 2035.

Thanks in part to steps that we’re taking to implement the Clean Electricity Plan, we’re on track to surpass our 2025 renewable energy target more than five years early — and at a reduced cost to our customers — if our integrated resource plan is approved by regulators.

The addition of new renewable resources called for in our plan, combined with our existing wind, solar and hydroelectric facilities, will enable PGE to generate more than 50% of our energy from carbon-free sources by 2020.

Our Integrated Resource Plan and associated action plan, filed in November, will serve as a roadmap over the next few years to help get us to this ambitious goal. The plan reflects input from customer groups, environmental advocates, regulators and energy experts.

It calls for adding more renewable power to our system backed by resources that can be quickly ramped up and down to meet customer demand, and it calls for energy efficiency and demand response to reduce use during peak demand.

Specifically, the plan calls for:

  • A minimum of 135 MWa of cost-effective energy efficiency;
  • 77 MW of demand response; and
  • Approximately 175 MWa of qualifying renewable resources. (Wind nameplate of 500MW)

Our initial submission also identified the need to acquire up to 850 MW of capacity, which included 375-550 MW of long-term dispatchable resources and up to 400 MW of annual capacity resources. A large part of this capacity deficit is the result of the planned closure of our 600MW Boardman coal plant.

Since filing, however, we reduced the 2021 capacity need in the IRP from 819 MW to 561 MW. This is due to a reduced load forecast update, a renewal of a hydro contract and additional contracts with PURPA-qualifying facilities. This 561MW of flexible capacity is required to meet our customer’s firm load when the sun doesn’t shine and the wind doesn’t blow.

At the same time, we continue to explore opportunities to acquire this additional reliable and cost-effective, flexible capacity for our customers through bilateral negotiations. This includes exploration of potential dispatchable generation that may be available from Northwest facilities.

As part of OPUC’s public review process, we filed comments on March 31, 2017. An additional round of comments will follow in May as we address stakeholder questions and work to identify the best strategy for achieving a renewable, reliable, affordable energy future for our customers.

We expect the OPUC to issue a decision or acknowledgement of our plan by August 31st of this year. Following acknowledgement of the IRP and the outcomes of bilateral negotiations for flexible capacity, we will request approval from the OPUC to issue one or more requests for proposals for remaining capacity needs and renewable resources.

We have no predetermined outcome for these RFPs. We’re open to a variety of options and will be seeking the best combination of resources — consistent with the acknowledged IRP Action Plan — to meet our customers’ future energy and capacity needs.

Resource options could include hydro, wind, solar, geothermal, biomass, efficient natural gas-fired facilities, and energy storage. The RFP process will include oversight by an independent evaluator who reports to the OPUC as well as overall review by the OPUC itself.

In addition to resource planning, in 2016 we invested more than $600 million to keep our system safe, clean and resilient and to meet our customers’ needs.

  • In addition to putting our Carty Generating Station into service;
  • We replaced aging transmission and distribution equipment and systems; and
  • We added seismic upgrades at our historic T.W. Sullivan and River Mill hydro facilities.

These and other investments are enhancing our ability to respond quickly and effectively to potential emergencies, such as storms, earthquakes and cyberattacks.

We are committed to building a cleaner energy future for our region while providing the safe, reliable and affordable energy our customers depend on.

I’m proud of the strides we made as a company in 2016. I look forward to our continued collaboration with stakeholders in the communities where we live and work to make sure that our business operations continue to balance all Oregonians’ values.