OUC may resume $1 million study on when to wean itself off burning coal
Suspended because of the pandemic, Orlando Utilities Commission’s $1 million investigation into revamping itself in the face of climate change may soon come back to life amid new developments for the future of green energy.
The nation’s accelerating trend of electric utilities retiring generators that run on coal has come close to home as OUC’s peer in Jacksonville, JEA, opted this summer to shut down a huge plant and boost spending on solar energy.
And this week, a national research firm specializing in energy, economics and the environment released a study paid for by Sierra Club, finding a “significant disconnect” between Orlando’s leaders and OUC on the place of clean energy.
Utility spokesman Tim Trudell said OUC’s general manager, Clint Bullock, will give an update Tuesday on the status of what the city’s power provider calls an Electric Integrated Resource Plan, or EIRP, which is expected to detail retirement considerations for OUC’s two coal plants.
“We have not lost site of the EIRP by any means, but it’s been a very trying year,” Trudell said.
JEA, a municipally owned utility like OUC but larger, announced in June that it had agreed to close a coal-burning power plant owned jointly with Florida Power & Light Co., an investor-owned utility and the state’s largest electricity provider.
That plant, near Macon, Ga., started running in 1989 and has the capacity to produce 848 megawatts of electricity.
OUC’s two coal plants at the Stanton Energy Center in east Orange County, each with a capacity of 464 megawatts, started running in 1987 and 1996. They were designed to last 40 years, but the utility has made large investments to prolong their lifespans.
By closing its coal plant, “JEA will lower operating costs, substantially reduce operating risks, and reduce CO2 emissions by approximately 1.3 million tons per year,” JEA said in a statement, referring to emissions of carbon dioxide that accelerate climate change. “The transaction also provides a pathway to significant expansion of solar energy in the near future.”
A large expansion of solar energy is the most optimal financial path for Orlando and its utility, according to a report by Synapse Energy Economics Inc. of Cambridge, Mass., that was commissioned by Sierra Club leaders in Florida.
Synapse does technical and policy examination for federal agencies, local governments, advocacy groups and energy companies.
In 2017, Dyer and the city council approved a goal of eliminating the city’s use of coal and other fossil fuels, stating a commitment “to power 100% of our city using clean, renewable energy sources by 2050.”
In February, OUC announced a plan to have in place by 2050 “net-zero carbon emissions,” which may mean continued use of fossil fuels and offsetting their carbon emissions through other measures.
There is a “significant disconnect between Orlando Mayor Buddy Dyer’s stated climate commitments and the action of its electric utility,” the Synapse study contends. “OUC must provide Mayor Dyer and the City of Orlando a clear plan on how it will transition from its current reliance on fossil fuels to a clean system that relies on solar PV, battery storage and energy efficiency.”
A city spokeswoman did not address the assertion of a disconnect between the city and OUC.
“The City of Orlando is currently in the process of reviewing this study and remains committed to achieving 100% clean energy future by 2050,” spokeswoman Samantha Holsten said in an email.
OUC is the state’s second-largest municipal utility, with nearly 215,000 residential customers and 26,000 commercial customers.
The utility is governed separately from city hall but is a top source of cash for the city’s budget, contributing nearly $100 million last year, and has permanent seat on its board for the city’s mayor.
The Synapse report also examines an area of OUC performance in which the utility is at odds with environmental and smart-energy groups.
“OUC also ranks among the worst in the nation for energy efficiency investment,” the Synapse report states. “This is particularly concerning because the American Council for an Energy-Efficient Economy (ACEEE) estimates that energy efficiency upgrades could cut energy use by 18 percent for homes and 23 percent for commercial buildings, thereby reducing greenhouse gas emissions and lowering system costs for ratepayers.”
OUC contends that it customizes programs for efficiency that don’t comply with industry or regulatory standards but still outperform other utilities in Florida.
“We believe that our local OUC Board can better decide what makes the most sense for our customers,” said OUC’s chief customer officer, Linda Ferrone, in a presentation on the utility’s website.
The Synapse report presents three scenarios for OUC: continued operation of the Stanton Energy Center coal plants, converting the coal plants to run on natural gas, and closing those plants and ramping up investment in renewable energy and energy efficiency.
“Transitioning to renewables will save ratepayers $176 million over the next two decades relative to continuing to rely on coal and $543 million relative to converting Stanton to gas,” the report states.
The Synapse firm goes on to state that replacing the Stanton coal units with renewable energy would increase local, high-paying jobs.
“Compared with investment in fossil fuels, renewables and energy efficiency create between two and three times as many jobs for the same quantity of spending,” the report states.
kspear@orlandosentinel.com
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