If you’re an energy nerd like us, you may have noticed that SWEPCO, a subsidiary of AEP and the utility that serves much of Northern Louisiana, is asking their regulators for permission to add 1,485 MW of wind energy to their resource mix. One of the three wind farms, Traverse, is going to be one of the largest wind farms in the country with a nameplate capacity of 999 MW. All three developments are in Oklahoma, but are designed to benefit customers in Oklahoma, Arkansas, Louisiana and Texas. If you’re feeling some deja vu, it’s not a glitch in the matrix, this is a very similar project as Wind Catcher from 2017. And, similarly, SWEPCO needs approval from all four states. The difference is that this project is scalable, so if Texas fails to approve it, like they did Wind Catcher, SWEPCO has plans to scale it back so the majority of the project can still go through. Currently the project has been approved in Oklahoma and Arkansas, while proceedings in Louisiana and Texas are still ongoing. The Alliance is an intervenor in this proceeding, and we’ll be working to make sure renewables adoption is affordable for all in Louisiana. Bring on the renewable energy, and do it in a way that works for everyone!
Renewable energy is not just a thing in New Orleans (or Texas, or California, or Nevada, or practically everywhere else) anymore. Louisiana is trying to get in on that crazy wind and solar action. Late last year, Commissioner Greene opened up a rulemaking docket to develop Renewable Energy Tariff Options to address the growing desire electricity customers have for green energy. Walmart, one of our state’s biggest employers, as well as numerous other commercial customers have sustainability goals that can be challenging to meet when our state is still heavily powered by oil, gas and even coal. And, it’s more than just our large corporations! There’s a growing demand from residential customers and even cities, as Abita Springs has signed the Ready for 100% pledge. We know that renewable energy tariffs, or Green Tariffs as they’re often called, can accelerate the growth of renewable energy sources on the grid while keeping costs low. But, a poorly designed tariff isn’t going to do anyone any good. So, here’s our opportunity to push for renewable energy options that work for us!
The short answer is that companies are recognizing Louisiana’s untapped DR potential, and Louisiana’s Commercial and Industrial electric companies are seeing DR as a way to get lower rates. The Commission also sees DR as a way to mitigate the need for new power plants.
Well structured Demand Response (DR) programs generally offer a financial incentive to customers who shift their electric usage to non-peak times. DR is a form of Demand-Side Management (DSM), alongside Energy Efficiency, and similarly to Energy Efficiency, Louisiana has a lot of untapped potential. So the LPSC opened a ‘Rulemaking’ docket to determine if our utility companies should be required to offer DR programs, and in what capacity. Simultaneously, Entergy Louisiana (ELL) opened two dockets to set new rates for Interruptible Service (U-35385, Experimental Interruptible Option) and rates for DR (U-35443, Market Value Demand Response). And, although ELL’s proposed new DR programs, or tariff options, may appeal to Louisiana’s large commercial and industrial customers they will likely not be available to residential customers and unfortunately may still leave a lot of DR benefits on the table. Even if ELL’s proposed DR tariff options are 100% perfect, they will only be available to ELL customers, leaving out Cleco and SWEPCO customers, not to mention all of our rural, electric co-op customers that will not be able to access them. The best way the LPSC can approach this is to focus on the Rulemaking docket to set comprehensive DR standards that all of our utilities are required to meet. By taking a holistic approach, the LPSC can ensure that state level DR programs are inclusive and accessible to all customer classes.
We are anxiously awaiting an updated Draft Rule from LPSC Staff that could make or break the kWh bank. From there we expect a Technical Conference to work out our disagreements, at least one more round of comments, and fingers crossed it will come to a vote by mid 2020 to go into effect in 2021. We’re feeling pretty optimistic, but don’t pop the champagne yet. The Commission will be responding to public demand for these programs.
Yes, 2020 might be the year to really shake things up at the Commission. With a fleet of aging power plants in the state, the LPSC needs to put all options on the table to mitigate significant bill increases that could result from a whole new fleet of power plants. It’s time to evaluate all of our existing resources, and think outside of the box. Pop the popcorn folks, and pay attention, this discussion is bound to be electrifying.
