Arizona’s Electric Cooperatives Support “First Step” Toward Workable Regulations
FOR IMMEDIATE RELEASE – March 29, 2017
Geoff Oldfather AzGT Cooperative Communications and Public Relations Manager
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Grand Canyon State Electric Cooperative Association
Director of Communications
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Benson – Arizona’s not for profit, member-owned electric cooperatives applaud the executive order issued Tuesday by the White House on the U.S. Environmental Protection Agency’s Clean Power Plan (CPP).
“The Clean Power Plan was a one-size fits all rule that didn’t take into account the challenges we face in rural communities,” said Patrick Ledger, CEO of Arizona Electric Power Cooperative (AEPCO).
“This executive order is a first step toward protecting rural Arizona families and businesses from the plan’s potentially devastating impacts, and we look forward to working with the administration to advance our common goals, taking into consideration impacts on electric cooperatives and public power,” Ledger said.
The CPP targets carbon emissions from power plants across the country, but because electric cooperatives serve mostly rural areas where fewer ratepayers share the costs of energy production, the cost of implementing the CPP would have a disproportionate economic impact on rural Americans. Moreover, because electric cooperatives are nonprofit and consumer owned, hundreds of millions of dollars in unnecessary costs associated with abandoning current power generation assets and rapidly replacing these assets with compliant power resources would have been paid, not by the shareholders or the government, but by rural consumers.
According to Ledger, “The prior administration’s refusal to take these sort of facts into consideration in developing the CPP cannot be overstated. The rule would have resulted in devastating rate increases, exacerbating economic disadvantage in rural communities.”
The impacts of the CPP would have been felt on top of other costly regulatory measures already being implemented by AEPCO. As a result of the EPA’s Regional Haze mandate, AEPCO is converting one of its coal fired steam units at its Apache Generating Station to natural gas, a move that improves haze causing emissions, but substantially increases the cost of the energy produced from the unit.
In October of 2015, AEPCO and many other electric cooperatives joined the National Rural Electric Cooperative Association to petition the U.S. Court of Appeals to review and reject the CPP on the grounds that it would disproportionately impact rural electric cooperatives. That effort helped lay the groundwork for the stay issued by the Supreme Court in early 2016.
Although the executive order largely redirects the policy objectives of the EPA and other federal agencies, it is important to understand that the EPA still has to undertake a full rule making procedure to completely undo the finalized CPP regulation, which could take years.
“Until then, we will continue working with our member cooperatives, and with all stakeholders, from regulators to elected officials, to achieve a healthy rural economy and a clean environment. We appreciate the support from members of Arizona’s Congressional Delegation, the Arizona State Legislature, Arizona Department of Environmental Quality and the Arizona Corporation Commission. We are looking forward to continuing to work with all of our elected officials to build on the progress we’ve made so far,” Ledger said.
About Arizona G&T Cooperatives
Arizona Electric Power Cooperative (AEPCO) and Sierra Southwest (Sierra) collectively make up Arizona G&T Cooperatives. AEPCO owns and operates the 605-megawatt (combined gross) Apache Generating Station, located at Cochise, east of Benson. AEPCO also owns and maintains more than 620 miles of transmission lines and 50 substations to provide wholesale electric power from Apache to six member distribution cooperatives in southern Arizona, western New Mexico, northwestern Arizona and California.
Combined, the distribution cooperatives that receive AEPCO’s wholesale power serve more than 150,000 meters representing more than 400,000 individual residential, commercial, agricultural, and industrial member-consumers.
The Class A member cooperatives that receive wholesale power from AEPCO include Duncan Valley Electric Cooperative, Duncan; Graham County Electric Cooperative, Pima; Mohave Electric Cooperative; Bullhead City; Sulphur Springs Valley Electric Cooperative, Willcox; Trico Electric Cooperative, Marana; and the California member, Anza Electric Cooperative, Anza, California.
These member cooperatives own AzGT and, by extension, the G&T Cooperatives are owned by their members—the people at the end of the line who use the power. These cooperatives also borrow from the Rural Utilities Service, a federal agency.