learning from our past to shape our future from our past to shape our future robert w. cromwell, ......
TRANSCRIPT
www.seattle.gov/light/
Director, Power Contracts and Resource Acquisitions
LEARNING FROM OUR PAST
TO SHAPE OUR FUTURE Robert W. Cromwell, Jr.
The Nation’s Greenest Utility
WHY DO WE CARE?
• The Columbia River basin has the most hydropower capacity (~37 GW) in North America, but large variations in seasonal and annual natural flows that cause power and flood control regulation problems.
• USA-Canada treaty signed in 1961
(ratified in 1964) - provided for flood control and increased power benefits through building three dams in Canada, one in the US. and coordinated river management.
• Power benefits at US projects were to
be shared 50/50 with Canada (“Canadian Entitlement”) and delivered through the Puget Sound to Canada at Blaine by the Bonneville Power Administration (BPA).
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The Nation’s Greenest Utility
WHY DO WE CARE?
• September 16, 2024 is the earliest date
when either country can terminate the power benefit provisions of the Treaty, with a minimum 10 years’ written advance notice. The notice to terminate in 2024 would be due in September 2014.
• Flood control provisions of the Treaty
cannot be terminated and will change in 2024 to become “called upon” where the USA must request and pay for any action by Canada.
• Ecosystem mitigation efforts are wide-
spread, but continue to be contentious and the subject of decades-long litigation.
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The Nation’s Greenest Utility
WHY DOES SEATTLE CARE?
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The Nation’s Greenest Utility
CRT 101 – POWER & FLOOD
• Canada must operate 15.5 Maf of their Treaty storage for optimum power generation downstream in Canada and the United States.
• U.S. must deliver electric power to Canada equal to one-half the estimated U.S. power benefits (Canadian Entitlement) from the operation of Canadian Treaty storage, currently worth about $160 - $350 million annually.
• Province of B.C. owns Canadian Entitlement, and BPA (on behalf of the U.S. Entity) delivers the power based on daily schedules set by B.C.
• Owners of five Mid-Columbia non-federal hydro projects deliver 27.5% of Canadian Entitlement to BPA for delivery to B.C. - Chelan, Douglas and Grant PUDs.
• Canada is now obligated to operate 8.45 Maf (now 8.95 Maf) under a plan that attempts to eliminate all flood damages in both Canada and the U.S. Canada must also operate all additional storage on an on-call basis (never exercised).
• The U.S. paid Canada $64.4 million for one-half the present worth of the expected future U.S. flood damages prevented from 1968 through 2024 towards dam construction and purchased 8.45 Maf of flood control operation that expires in 2024.
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The Nation’s Greenest Utility
CRT POWER GROUP 101
The Columbia River Treaty Power Group is a forum for electric utilities,
industry associations, and other entities that depend upon power produced
by Columbia River generating plants to engage in the United States’
evaluation of whether to continue or terminate the Columbia River Treaty with
Canada.
Alcoa Inc. Avista Benton PUD Chelan PUD Clark Public Utilities Douglas PUD Eugene Water and Elec. Brd. Franklin PUD Grant PUD Grays Harbor PUD Idaho Power NW Requirements Utilities
PNGC Power PacifiCorp Pacific NW Utilities Conf. Comm. Portland General Electric Public Generating Pool Public Power Council Puget Sound Energy Seattle City Light Snohomish PUD Tacoma Power WA Public Utility Districts Assn. Western MT Gen. & Transm. Coop.
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The Nation’s Greenest Utility
DECEMBER 13, 2013 REGIONAL RECOMMENDATION
• We should seek the greatest possible shared benefits from coordinated operations for ecosystem, hydropower and flood risk management as well as all other uses.
• The health of the basin’s ecosystem is a shared benefit and cost.
• Post-2024 the Treaty should endure long enough to be relied upon, but adaptable enough to respond to changing conditions and new information.
• All operations should be based on best available science, and to the extent practicable, measurable outcomes.
• U.S. federal projects will meet authorized uses consistent with U.S. laws and Treaty obligations (including Treaties with Indian Tribes); while non-federal projects will continue to comply with their FERC licenses.
• The U.S. and Canada should pursue enhanced coordination of Treaty and non-Treaty storage to meet the needs of both countries.
• Adaptations to the Treaty should be flexible to adjust to future climate change impacts.
• Treaty modifications could result in new benefits and/or costs that should align with the appropriate party.
• Implementation of ecosystem-based functions in the Treaty should be compatible with rebalancing the entitlement and reducing U.S. power costs.
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The Nation’s Greenest Utility
WHAT NEXT?
Balance
A balanced approach consistent with the U.S. Entity’s Regional
Recommendation that recognizes the inter-connected nature of river
operations, whether for fish flows, power generation or flood control.
Reset Expectations
• Ecosystem issues would be integral to a revised Treaty, and exchanging
“diplomatic notes” won’t deliver that outcome.
• The Treaty is not the proper forum to resolve every “ask” or all grievances.
• Other river uses may need to start compensating Canada.
• Flood control and particularly alternative approaches will be a difficult
future conversation. Almost as difficult as deciding who pays…
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The Nation’s Greenest Utility
WHAT MIGHT THE FUTURE LOOK LIKE?
• A substantially reduced Canadian Entitlement return.
• A dry year strategy for ecosystem improvements
• Detailed negotiation of compensation and pre-conditions for “Called Upon” flood control post-2024
• A likely Canadian request for compensation for uses of water beyond power generation and flood control (recreation, irrigation, etc.) driven by the pending Ernst and Young study for British Columbia
• The “T” word?
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The Nation’s Greenest Utility
RESOURCES
http://www.crt2014-2024review.gov/Files/Regional%20Recommendation%20Final,%2013%20DEC%202013.pdf (U.S. Entity Regional Recommendation) http://www.nwcouncil.org/history/ColumbiaRiverTreaty (NW Council) http://www.crtpowergroup.org/ (CRT Power Group) http://blog.gov.bc.ca/columbiarivertreaty/map/ (B.C. Ministry) http://www.cbt.org/crt/ (Columbia Basin Trust)
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The Nation’s Greenest Utility
OUR MISSION
Building on a legacy of clean hydro power, Seattle City Light partners with customers to secure a green energy future. We are leaders in providing innovative ways to conserve electricity and invest in renewable resources.
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Questions? - [email protected] or (206) 684-3856