Thousands of Northwest residents will be getting less electricity from burning coal. That’s because of a new agreement to fast-track the closure of a coal-fired power plant in Montana.
The announcement came Friday as part of a rate settlement from Puget Sound Energy. The investor-owned utility has agreed to be financially ready to close its coal plant in Montana nearly two decades ahead of what they’d originally planned.
To do this, PSE will increase customer’s electric rates by about 1 percent. That increase will be offset by a 4 percent cut in natural gas rates.
“This settlement establishes a workable mechanism to fund the decommissioning and environmental remediation at Colstrip,” said Ken Johnson, PSE’s director of regulatory affairs. “It ensures future generations will not be burdened by costs resulting from decisions made five decades ago.”
Puget Sound Energy serves about a half-million customers the Puget Sound region. Its deal to shut down Colstrip will also affect two utilities in Oregon: Portland General Electric and Pacific Power also get electricity from the Montana coal plant.
They had previously been on pace to eliminate coal from their portfolios by 2030 under a bill signed into law last year by Oregon. Gov. Kate Brown.
Colstrip was already scheduled to shut down two of its generating units by 2022. This new timetable concerns the other two units at the plant.
PSE has also agreed to provide $10 million to help the surrounding community of Colstrip transition once the plant closes.
Conservation groups praised the funds to the community. They also said that once the coal plant closes, transmission lines could be freed up to transport wind power from Montana to the Northwest.
Rachel Shimshak, executive director of Renewable Northwest, said in a statement that it seemed obvious that eastern Montana should be economically transitioning from a dependence on coal to cleaner energy sources.
“But there are many technical questions to be addressed in order to make this transition possible. I am pleased this settlement provides a process for answering those questions,” she said.
The settlement also increased funding for customer bill assistance, weatherization and storm damage.
The deal has to be approved by Washington Utilities and Transportation commissioners. A hearing date is set for Sept. 29 in Olympia.
The rate case is not completely settle — the commissioners will hear debate and then make a final decision about several other issues, including questions about rate design and structure.
Oregon and Washington have already been moving away from coal, which is the biggest source of greenhouse gasses that contribute to global warming. A coal plant in Boardman, Oregon, is scheduled to close in 2020. Centralia, Washington’s coal plant will be completely shut down in 2025.