What’s to Like about PSE?

Puget Sound Energy (PSE) is the electricity provider for Bainbridge Island, Washington. 35 percent of the power for PSE’s 1.1 million customers comes from the Colstrip power plant in Montana, shown above. Colstrip is one of the top 10 carbon polluters in the United States. In the past two years, a local citizen organization, Friends of Island Power, has lobbied the City of Bainbridge Island to consider switching our power provider to the Bonneville Power Administration (BPA), a Federal agency that markets primarily hydroelectric (but also some nuclear) power to 62 public power utilities in Washington. If Bainbridge were to switch providers, it would become the 63rd public power utility in Washington. The current 62 public power utilities provide about 63 percent of the power delivered to customers in the state. In order to be able to buy power from BPA Bainbridge would need to purchase or re-build the electrical distribution infrastructure on the Island currently owned by PSE.

I have posted several times on the Bainbridge Island Facebook discussion group, Bainbridge Islanders, the question, “What’s to like about PSE?” It has been variously said by supporters of continued use of PSE as our electricity provider that the “claims” that I have put forward there are “falsifications” and “not proven.” This page is devoted to stating these “claims” and to addressing the opposing claims that have been made by my pro-PSE neighbors. First let’s turn to the “claims”.

IPCC Temperature Chart

1) According to the International Panel on Climate Change, our climate has warmed by approximately one degree Centigrade since the beginning of the twentieth century. That is nearly 2 degrees Fahrenheit. The World Resources Institute projects that 90% of coral reefs will be in danger by 2030 and all of them by 2050, due to ocean warming and acidification. Sea level rise is has recently been projected at over 8 feet by 2100 resulting from melting of land ice in the polar regions.

CO2 ChartCO2 Long History

2) The average carbon dioxide concentration in our planet’s atmosphere just reached 400 parts per million (See here.) US Department of Energy measurements of ice cores have shown that Earth’s atmospheric carbon dioxide concentration had not been greater than 300 parts per million for 800,000 years prior to 1950. Almost all climate scientists that are not working for the fossil fuel industry understand that global warming, sea level rise and ocean acidification are due to burning of fossil fuels which transform reduced carbon buried millions of years ago into carbon dioxide, which is a greenhouse gas. It is the burning of fossil fuel that causes global warming, sea level rise and ocean acidification. There is no other cause that accounts for the effects that we have seen. (See the IPCC reports, for example, or US EPA pages put together before they are deleted by the Trump administration.)

Fuel Mix Comparisons
3) PSE’s fuel mix for electricity delivery in Washington State in 2014 (the latest data publicly available from the Department of Commerce) was 59 percent based in fossil fuels compared to less than 3 percent for utilities getting power solely from BPA, as Bainbridge initially would. PSE’s is the highest ratio of all of the 65 electric power utilities in Washington State. BPA’s is the lowest, resulting from small purchases on the market of mixed source power.

Ave CO2e Emissions
4) By my calculations, in 2014 PSE electricity production resulted in 11 million tons of carbon pollution, approximately 12 percent of the total greenhouse gas emissions from all sources in Washington State. To do this I used standard greenhouse gas emission factors for coal and natural gas and hydropower. This does not include emissions from their natural gas sales to homes and businesses. The 11 million tons came from their share of the Colstrip, Montana coal burning generating station, but also from natural gas burning and co-generation generating stations within Washington State. I calculate PSE’s 2014 carbon pollution from electricity production to be over 9 tons per customer per year, 15 times greater than the 0.6 tons per customer for most utilities served by BPA.

Reliability Comparison
5) The average for the public power utilities in the Northwest region as published in reports by the American Public Power Association is about 1 outage per year per customer and the average outage duration was 137 minutes per customer per year. The average outage frequency for PSE customers for the recent five-year period in Kitsap County was about 5 per year and the average outage duration  was over 600 minutes per customer per year, based on data from their reliability report to the Washington State Utilities and Transportation Commission (UTC). The average for Bainbridge was also over 600 minutes per year per customer based on PSE data submitted to the City of Bainbridge Island in the summer of 2016. The comparable period of outage durations for the nearby public power utilities in Gig Harbor (personal communication) and Snohomish PUD were five times less. In Port Angeles the outages were fifteen times less (personal communication).

PSE Publics Rate Comparisons 1395 kWh per mo Wide Survey6) PSE’s monthly bill for residential customers using between 1,000 and 1,500 kWh per month in December 2016 ranged from $104 to $156 per month and that average ranged from the seventh highest to the fourth highest out of 49 utilities surveyed in December 2016. Public power utilities in the State of Washington averaged about 20 percent less than the PSE rate at 1,000 kWh per month usage to nearly 30 percent less at 1,500 kWh / month usage. The figure above shows a bill comparison with the 48 other utilities surveyed based on usage of 1,395 kWh per month, the average total power consumption for Bainbridge Island (including all customers). PSE customers have the fourth highest bills among these 49 utilities on this basis. If one is paying the “green power” rate, this is the second highest bill of the 49 utilities surveyed. At 1500 kWh per month it is the highest. These data were developed by following the links on the Washington State Department of Labor and Industries website and taking down rate schedules published on individual utility websites. Here is the link to the Excel spreadsheet that calculates these rates.

The billing rate for the Jefferson County PUD, which recently purchased its electricity distribution infrastructure from PSE,  has been the same or less than that of PSE over the entire period form 2013 till December 2016. In January 2017 JPUD’s rates went up. PSE has a rate increase pending with the UTC for 2017. Public power rates on Bainbridge could be competitive based on this history and based on the recent D. Hittle report, now in draft form.

What I conclude from this collection of what I maintain are undeniable facts is this: PSE is a carbon polluting giant which has delivered terrible reliability at high cost to its customers on Bainbridge Island. I no longer want to support them with my $2,000 per year of electricity consumption. My question above, “What’s to like about PSE?”,  has not been answered by pro-PSE advocates, but from what I glean from various comments on the Bainbridge Islanders discussion group, they maintain the following:

7) “Dirty electrons get mixed with clean electrons and, as a result, withdrawing 12,300 customers from PSE will do nothing to arrest their disastrous burning of fossil fuels.” – My first reaction to this is that little steps can create big results. Island Power has been contacted by several organizations fighting PSE’s carbon pollution in Washington State about starting new campaigns in the other seven counties where PSE still serves. Island Power will cooperate fully with these organizations to the extent that it can. My second reaction is that if divestiture of our over $20 million per year in rental payments from this carbon polluting monster is meaningless, why is PSE having town halls, haunting our public meetings, hiring their own consultants to fight Bainbridge’s campaign and spreading so much money (our money) around the Island?

PSE Historical Power and CO2e Emissions

It seems to be true that when JPUD and its 40 MW load left the PSE system this contributed to an overall load decreased for PSE. But the carbon emissions from their generating sources actually went up. Their carbon emissions were in the range of 11 to 12 million tons per year from 2008 to 2010, but then dropped to under 10 million tons per year in 2011 and 2012 prior to the JPUD departure. This conclusion is based on analysis of the Washington Department of Commerce reports referenced above.  The emission decline was caused by more use of hydro and wind power during these two years. Then in 2013, when JPUD left their system, their carbon pollution increased again back up to around 11 million tons per year. This was caused by an increase in coal and natural gas generation. What does this tell us? To me the lesson from this is, “We can’t control what PSE does.” If we no longer want decisions about our electricity sources to be made in Bellevue (PSE headquarters), Olympia (UTC meetings) and Sydney, Australia (PSE is owned by a hedge fund, Macquarie Capital, in Sydney), we need to divest and choose our own power source (initially at least): 97 percent carbon free power from BPA.

8) “PSE keeps the lights on. What more do you expect?” – Well, my reaction to this comment is that relative to other public power utilities PSE’s reliability here is terrible. My household was out of PSE power for 3 days in 2016. Reliability will not immediately improve with purchase of the distribution infrastructure. Our infrastructure here is quite degraded. We need transmission looping and a redundant substation. We need to do more under-grounding. That will not be cheap. But PSE has failed to make these improvements. Last year’s outage record shows that things have not gotten better, but worse. What will happen if a public power vote fails? Will PSE rush to make these investments? It is quite appropriate that many of the PSE donations to Bainbridge Island organizations in the past few years have been for standby generators, very important when reliability of power delivery is as poor as it has been here.

9) “We can’t afford to take over PSE. We will be loaded with debt if we do so.” – To me, Jefferson County PUD is the best example of why we should purchase PSE’s distribution infrastructure, which would allow us to get nearly carbon-free power from BPA. The current JPUD commission president, who admitted in the Island Power forum on Saturday, 11 March 2017 that he voted against the Jefferson County purchase, is today a big supporter of public power. I heard him say that they have built up their capital reserves from around $1 million dollars to over $12 million. They employ around 40 local workers. They are now receiving power from BPA which is 97 percent free of planet-disrupting fossil fuel burning. And this after they paid over double for the infrastructure based on the net book value which the UTC determined was around $47 million. After the UTC final order took back $53 million of this inflated purchase price to give to other PSE ratepayers in 2014, I think we would be foolish to pay a 100 percent premium for a degraded infrastructure with an assessed value of less than $20 million. We will be buying a “fixer upper.” We should not pay a premium price for it. Our recent draft municipalization study (the D. Hittle report referenced above) shows us that if we pay much less than the 100 percent premium that was paid in Jefferson County we will have a good ability to start to improve this degraded system with reasonable rates.

Color PUD Map

10) And then there is the granddaddy of all arguments against public power for Bainbridge: “COBI (the City of Bainbridge Island) couldn’t manage its way out of a paper bag!” – Come on. There are 62 public power utilities in the State of Washington: Directly managed municipal (3 cities larger than Bainbridge and 17 smaller), board-managed municipal (Tacoma), Public Utility Districts (shown above – 28) and multiple coops (including Gig Harbor and Tanner Electric in King County).

Do citizens of Bainbridge Island always agree with their local government? No they do not. That is what democracy is all about! Does that mean that the City of Bainbridge Island couldn’t manage our electricity distribution network? Of course it doesn’t. It has been said that COBI has poorly managed the utilities that it now controls, providing water and sewage collection and treatment to one third of the Island and storm water management to the entire Island. But consider that while across Puget Sound from us King County has been discharging raw or poorly treated sewage into Puget Sound for years, COBI had its sewage spills (2) and each was managed within a few days. Water rates are as low as any peer agencies. There is a substantial amount of money in the bank. Sewer rates are relatively high because of a recent major treatment upgrade, but will go down over time as the bonds for this construction are paid off. COBI’s wastewater treatment plant provides nitrogen as well as organics removal while the large wastewater treatment plants operated by King County in Seattle and Renton provide only nominal organics removal (when they are fully functioning). COBI already manages a significant power distribution system at its wastewater treatment plant. This is not rocket science. COBI is actually doing fine at utility management.

Does everyone agree that PSE has managed its electricity service here well? I certainly don’t. It has chosen to pollute our atmosphere with carbon and the City of Colstrip, Montana has to truck water from the Yellowstone River 30 miles away because of leakage from the Colstrip power plant ash disposal ponds, which have polluted ground water for miles around. We have already talked about reliability: Five times worse than adjacent public utilities. And rates: 4th or 7th highest out of a recent survey of 49 utilities. Not high (good) marks. Can Bainbridge Island do better? Based on the experience of 62 other public utilities in Washington State, the answer for me is an overwhelming, “Yes.”

Which leads me to the following conclusion: It would unconscionable for us to not take the opportunity to purchase PSE’s electrical power distribution infrastructure here on Bainbridge Island so that we could get 97 percent carbon free power from BPA and begin to take our energy future into our own hands. My answer to the question, “What’s to like about PSE?” is “Nothing that I can see.”