Hydropower from Bonneville Power Administration will help fill a shortfall in Portland General Electric Company’s generating capacity after 2020, when its Boardman Generating Station ceases coal-fired operations.
The firms have reached power purchase agreements that will bring additional clean energy – primarily hydropower – to PGE customers while avoiding additional greenhouse gas emissions in the US Northwest.
“These agreements are a great opportunity for us to collaborate with BPA to achieve shared goals in the region,” said Maria Pope, PGE’s president and CEO. “This benefits all parties, making the most of available clean, Northwest hydropower to serve PGE customers here in Oregon.”
“These contracts are an example of how BPA is working toward greater cost competitiveness and capturing the additional value of the low carbon, flexible federal resources by strengthening partnerships with regional utilities as we collectively adapt to the rapidly changing energy environment,” added Suzanne Cooper, BPA’s vice president of bulk marketing.
Under two five-year agreements beginning in January 2021, BPA will offer to sell PGE up to 200MW of surplus hydropower generated from the Federal Columbia River Power System. Negotiations between BPA and PGE began after BPA responded to an inquiry from PGE seeking access to existing regional generating resources.
With the encouragement of the Oregon Public Utility Commission and other stakeholders, PGE reached out to BPA and other regional power generators last year as part of its integrated resource planning process to see if its need for additional on-demand generating capacity could be met without committing in the near-term to construction of new power plants.
In addition to allowing BPA to take advantage of a new opportunity to market its clean, flexible hydropower and generate direct revenue as part of a broadening portfolio of power products, the contracts allow PGE more time for new dispatchable resource technologies to mature to help the company integrate increasing amounts of renewable power onto its system.
"This is a great deal for the region. It's a value-added product for the federal power system and a good alternative for PGE. It puts off big new investments in gas that would have locked PGE and its customers into fossil fuels for decades," said Bob Jenks, Oregon Citizens’ Utility Board’s executive director.
“Instead of building new carbon-emitting resources, PGE is able to take advantage of existing clean hydropower, and BPA is able to lock in a future sale to help strengthen its financial health,” added Wendy Gerlitz, NW Energy Coalition’s policy director. “This deal is a win-win for the Northwest.”
While the power supplied to PGE’s system from BPA will come primarily from federal hydro projects, it will not count toward Oregon’s renewable portfolio standard, which requires PGE to serve 50% of its customers’ demand for power from qualifying renewable generating resources by 2040. Qualifying resources are generally facilities that began operating after 1995. Counting both qualifying resources and its owned and contracted carbon-free hydroelectric resources, PGE expects its energy mix to be at least 70% carbon free by 2040.