Puget Sound Energy's new long-term resource plan is failing to live up to the promise of Washington state's ambitious clean energy legislation by leaving the door open for more carbon dioxide-emitting resources, according to environmental advocates and Washington residents.
The debate over PSE's draft integrated resource plan (IRP), seen at a Feb. 26 meeting held by Washington regulators, is the latest example of a conflict over the degree to which natural gas will be needed to back up renewable energy, and whether or not using alternative forms of natural gas like biogas alleviates emissions concerns.
The IRP serves as a launching pad for how PSE, the state's largest utility, will implement Washington's 2019 Clean Energy Transformation Act (CETA), which requires utilities to transition toward carbon neutrality by 2030 and 100% clean energy by 2045. PSE and other Washington utilities must file their first CETA implementation plans by Oct. 1, and the plan must be consistent with the utilities' IRPs, according to state law.
The question of whether or not natural gas should be a "bridge fuel" to a cleaner energy system has been raised often over the past several years. But as more states adopt increasingly stringent standards for CO2 emissions reductions, the question is becoming more narrowly focused on whether gas generation has a role at all.
"Using lots of [conventional natural gas] with emissions uncaptured is incompatible with climate goals," said Daniel Cohan, associate professor of environmental engineering at Rice University. "Where gas may be valuable in the clean grids of the future is as a sparingly-used backup to renewables."
In the Northwest, environmental groups have argued that through better regional planning, coordinated sharing of energy and capacity among utilities, and significant expansion of renewables and distributed energy resources, the region can rely on hydropower, wind, solar, demand response and other forms of clean energy moving forward.
The "least-cost" plan set forth in PSE's draft IRP envisions increasing the utility's amount of distributed energy resources such as battery storage, demand response and non-wires alternatives from 443 MW in the 2022 to 2025 timeframe to a total of 3,547 MW by the 2031 to 2045 timeframe, while also increasing renewable energy resources from 600 MW to 4,462 MW over that period — a "dramatic departure from previous resource plans," according to comments from the staff of the Washington Utilities and Transportation Commission.
But at a Feb. 26 public meeting held by the commission, many PSE customers blasted the IRP for not moving quickly enough toward clean energy, retaining too much natural gas-fired generation and allegedly not setting a path to comply with CETA. "PSE's IRP is not aligned with the intent of CETA," stakeholder groups, including the Sierra Club, said in a letter sent to the commission before the hearing. "It is critical that this IRP reflect aggressive investments in clean energy because the IRP will become the framework upon which CETA's Clean Energy Implementation Plan will be developed."
Starting in 2026, the IRP identifies a need for additional "flexible" capacity that can be called upon at any time to serve peak demand and back up renewable energy, replacing coal-fired power. The utility's analysis concluded that combustion turbines powered by "renewable" natural gas — biogas captured from landfills and wastewater treatment plants — would be the least-cost option for this flexible capacity, and the plan calls for building 237 MW in nameplate capacity of these peaker turbines in 2026 to 2030 and another 711 MW from 2031 to 2045.
"These units would be the same basic generator as a natural gas combustion turbine, but instead of burning natural gas with petroleum diesel as a backup fuel, the generator would burn renewable natural gas with biodiesel as the backup fuel," the draft IRP said.
Some observers, however, are skeptical over whether PSE has sufficiently shown that this alternative form of gas is available and affordable. The lack of clear information about "renewable" natural gas supply in the draft IRP creates concern that, out of necessity, the peaker plants may end up running on conventional natural gas, according to Cynthia Mitchell, an energy economist who works on Pacific Northwest issues.
"RNG is not yet produced at utility-scale in this region and will require developing both supply sources and an infrastructure to deliver that supply to utilities," according to the draft IRP. In comments on the draft, the environmental group Renewable Northwest argued that PSE did not incorporate volatility of the biogas market into its model, nor did it consider "limited access to the resource."
There is also some controversy over whether "renewable" natural gas itself is truly carbon-neutral, with groups like the Sierra Club claiming that escaped methane from landfill gas can increase emissions.
PSE, however, believes its IRP is in compliance with the CETA, according to utility spokesperson Jarrett Tomalin. "We understand our customers' preferences for clean energy, but we also have a responsibility to balance cost for customers and to meet needs ensuring reliability," he said. "Many regional/state modeling efforts are also showing that meeting peak capacity needs is difficult without any use of natural gas generation."
One study from consulting firm Energy and Environmental Economics (E3) that has been widely cited by policymakers in the Northwest found that the region will need new natural gas-fired peakers to ensure reliability and that "absent technological breakthroughs, achieving 100% [greenhouse gas] reductions using only wind, solar, hydro, and energy storage is both impractical and prohibitively expensive."
But Mitchell believes that study used estimates for the costs of renewables and storage that are outdated and do not account for the fast trajectory at which costs have already declined for those resources. "Technological breakthroughs in the cost and capabilities of utility scale wind and solar and battery storage have already occurred at such a rapid pace as to increasingly displace gas generation in utility resource planning and operations," Mitchell writes in a not-yet-published analysis of the E3 study.
Similarly, PSE's draft IRP does not include distributed energy resources in its planning horizon early enough, potentially minimizing the role those resources can play in cutting peak demand, according to Renewable Northwest's comments