Sierra Club turns up heat on PacifiCorp

(Originally published in the Portland Tribune Nov. 13, 2014)

By PAUL KOBERSTEIN

After all-time monthly records in average global temperatures were set in May, June, August and September, 2014 is looking like it will be the warmest year on record, according to the National Oceanic and Atmospheric Administration. Sadly, more temperature records are likely in the near future, probably leading to tragic human and environmental consequences worldwide.

The Sierra Club is turning up the heat on Portland-based PacifiCorp to do more to address the problem. Climate scientists say temperature increases have been powered by emissions of greenhouse gases like carbon dioxide, largely from burning coal and other fossil fuels. PacifiCorp, which operates in Oregon as Pacific Power, gets about three-fifths of its power from coal, making it the nation’s 11th-largest producer of coal-fired electricity.

“Pacific Power is ignoring its obligation to our climate and the environment,” says Lauren Randall, a Sierra Club spokeswoman.

In a report released in October, the Sierra Club argues that closing the company’s coal plants would not only be good for the environment but would make financial sense, by avoiding large financial risks for ratepayers and shareholders. The report, “Risks and Opportunities for PacifiCorp in a Carbon Constrained Economy,” was written by Ezra Hausman.

PacifiCorp, owned by multibillionaire Warren Buffett’s Berkshire Hathaway, is “particularly well-positioned to take a leadership role in the transition to a cleaner electric sector,” the report notes. Berkshire Hathaway declares itself committed to clean energy on its website: “It’s the investment in and development of sustainable energy solutions that will be essential to our vision for Berkshire Hathaway energy’s future.”

The company, now one of the nation’s largest, has “access to abundant capital resources for forward-thinking investments in a clean-energy future,” the Sierra Club notes.

PacifiCorp’s plans

Pacific Power doesn’t minimize global warming or the role that utilities play in causing it. It’s a national leader in getting customers to sign on for “green power” or renewable energy options.

“We can all agree that we all care about carbon, and we all care about climate change,” says PacifiCorp spokesman Paul Vogel.

PacifiCorp says it plans to close two of its older coal plants next year, and close or convert a third plant to natural gas in 2018. It expects to close a few more in another decade, decreasing its reliance on coal by more than half by 2030.

But PacifiCorp wholly or partially owns 26 coal plants in Wyoming, Montana, Utah, Arizona and Colorado. About one-third of its coal comes from company-owned mines in Utah.

It sells power to 1.7 million customers in six Western states, including about 560,000 Oregonians from Astoria to Klamath Falls, some of them in Portland.

None of PacifiCorp’s coal plants are in Oregon. Portland General Electric, which serves most of the Portland market, runs the only coal-fired plant in the state in Boardman, and it pledges to stop burning coal there in 2020.

Each of PacifiCorp’s coal-fired power plants was built from 1954 to 1984. PacifiCorp is reluctant to get rid of all its coal plants at this time, saying the reliability of its electrical system would be put at risk.

But climate experts say it is now more urgent than ever for utilities like PacifiCorp to abandon their coal plants before it’s too late to forestall devastating effects of climate change, if it’s not too late already.

“Given that their coal plants are all 30 years old or older, that schedule seems less than ambitious, and more like running out the clock on their fleet as long as they can keep the units operating,” says Angus Duncan. He’s now president of the Bonneville Environmental Foundation and chairman of the Oregon Global Warming Commission.

Investing in its plants

In the next few years, PacifiCorp also plans to spend unspecified amounts of money to maintain and upgrade what remains of its aging coal fleet, as well as meet new federal standards for emissions of mercury and other pollutants. The company will ask consumers to pay the freight through higher electricity bills. In Oregon, that idea has been met with some resistance from the Public Utility Commission.

The Sierra Club calculates the total budget for these items, which would do little to reduce carbon emissions, could reach $4 billion, a figure the company says is just “speculation.”

PacifiCorp also says it has offset a large portion of its carbon dioxide emissions by protecting rainforests in Bolivia and Belize, predicated on the idea that saving trees absorbs more carbon. The company expects to reduce carbon dioxide in the atmosphere by 40 million metric tons from those two South American projects over 30 to 40 years. That’s equal to about 77 percent of one year’s CO2 emissions from PacifiCorp’s coal fleet, according to the company.

The value of these carbon-offsetting projects has been disputed. In 2009, a Greenpeace investigation charged that the Bolivian project’s sponsors — which included The Nature Conservancy as well as three major energy companies, American Electric Power, BP and PacifiCorp — overestimated carbon dioxide reductions resulting from the project by 90 percent, and that overall deforestation rates in Bolivia increased after the project started.

Renewables proposed

The Sierra Club report offers a blueprint for how the company could reduce its lofty greenhouse gas emissions by retiring the coal plants early, and meet electric demand via renewable resources.

“PacifiCorp must take climate disruption seriously — and what it means for Oregonians in terms of increased drought and wildfires from more extreme weather — and transition from coal to clean energy,” Randall says.

Coal historically has been one of the cheapest sources of power, but the low price never takes into account the high environmental costs.

In the past, the main obstacle to producing power from renewable sources has been cost. But since 2009, the price of wind power has declined 62 percent, according to a report by the Lawrence Berkeley National Laboratory released in August. In September, the Bay Area laboratory said the price of solar power is down 67 percent since 2009. These prices are below the cost of electricity from new coal, nuclear or natural gas-fired power plants, the Energy Information Administration reports.

Duncan says the planet’s future depends on energy choices dominated by renewables rather than coal. “We will have to be relying on renewables for upward of 80 percent of our electricity,” he says. “Given that Oregon already relies on hydro for 50 percent, that’s not such a reach as it seems.”