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Electric utilities speak to Legislature
Express broad support for HB 151 and SB123, bills designed to enable the regulation of reliability organization for Railbelt grid Alan Bailey for Petroleum News
On Jan. 27 representatives from the six Alaska Railbelt electric utilities presented testimony to a joint meeting of the House Special Committee on Energy and the Senate Special Committee on the Railbelt Electric System, expressing support for two bills that have been introduced during the current legislative session. The bills, House Bill 151 and Senate Bill 123, are similar and would give the Regulatory Commission of Alaska regulatory authority over an electric reliability organization for the Railbelt electricity system. The proposed legislation would also give the commission authority to review and pre-approve changes and additions to major generation and transmission facilities in the system.
The concept is to facilitate a more coordinated and efficient approach to the operation of the electrical system, which is owned and operated by six independent utilities and the State of Alaska. A reliability organization would oversee a mandated set of reliability standards for the system and conduct integrated resource planning for the entire system.
Railbelt Reliability Council In December all six of the Railbelt utilities signed a memorandum of understanding for the formation of the Railbelt Reliability Council, in effect an organization of the type envisaged in the two bills. The utilities are now in the process of forming the RRC, which would be regulated by the RCA. However, the RCA is worried whether it has clear statutory authority to conduct the required regulation - in December the RCA commissioners voted unanimously to support the passage of SB 123. Traditionally the commission regulates individual utilities rather than an organization that itself oversees utilities.
The RRC would maintain and mandate reliability standards; administer rules for open access to the grid; conduct Railbelt-wide system planning; and investigate the economic value of security constrained economic dispatch for all or part of the system. Economic dispatch involves the continuous use of the most cost effective power generation that is securely available.
The RRC will be governed by a board with six members representing the six Railbelt utilities and six members representing other stakeholders in the electrical system. The RRC CEO would have a tie-breaking vote on board decisions. Independent members would consist of two representatives from independent power producers, one member representing consumer interests, a representative from the Alaska Energy Authority and two non-affiliated members. The RCA and the state’s Regulatory Affairs and Public Advocacy Section would have non-voting board seats.
The utilities anticipate being able to stand up the RRC, with all of its foundational documentation, by the end of this year.
Testimony from utilities In testimony during the joint committee meeting, Julie Estey, director of external affairs for Matanuska Electric Association, commented that the development of the RRC constitutes a path parallel to the passage of the appropriate legislation, leading to RCA authority to accept an application for RRC approval.
Brian Hickey, chief operating officer for Chugach Electric Association, commented on the thinking behind some suggested adjustments to SB 123, including a clarification of the scope of RCA pre-approval of development projects.
Anna Henderson, general manager of Municipal Light & Power, commented that the legislation would lead to a robust regulatory process, adding further process and clarification to the regulations.
Tony Izzo, CEO of Matanuska Electric Association, said that the proposed legislation would result in a one-stop shop across the grid for a planning process involving a broad stakeholder group, leading to a reliable service at lowest cost.
John Burns, vice president, Golden Valley Electric Association, said that the envisioned collaboration between the utilities through the RRC would facilitate conversations, shape relationships and build trust, with endless possibilities for achievement. Burns said that the RRC reflects a series of commitments made by the utilities to propose and embrace meaningful, deliberative changes to the Railbelt grid.
And Brad Janorschke, general manager of Homer Electric Association, said that recent developments represented the most alignment he had seen among the utilities and that any remaining differences of opinion could be worked through.
Sen. John Coghill, chair of the Senate special committee, expressed appreciation of the tremendous effort that had gone into what is proposed while also commenting on the importance of recognizing the perspectives of other stakeholders in the electrical system.
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