Without an expanded power plant, SRP could struggle to serve customers by 2024

There’s no easy way to say it: Salt River Project’s ability to reliably serve our customers by the summer of 2024 is at risk.

Last month the Arizona Corporation Commission denied SRP a Certificate of Environmental Compatibility to expand a peak-demand natural gas facility in Coolidge.

The Corporation Commission rejected the recommendation by its own Power Plant and Transmission Line Siting Committee, which consists of experts who represent the public and evaluate utility applications to build power resources.

After their evaluation, which included eight days of public hearings and testimony, the committee voted to approve SRP’s application for the proposed Coolidge Expansion Project.

We risk outages on hot, summer days

Market challenges for Southwestern utilities are growing exponentially. Enough so that SRP, a leader in renewable energy and battery storage, must expand a natural gas plant to keep up with power demand.

The commission’s decision to overturn its own committee’s decision based on a detailed review is unfortunate and consequential.

Another view: SRP doesn't need a bigger power plant to meet demand

Third-party energy consulting group E3 concluded that the Southwest is facing “a significant and urgent need” for new power resources.

California energy officials recently warned that the state’s power grid lacks available energy to keep the lights on this summer, with a potential energy shortfall of up to 5,000 megawatts should challenges such as wildfires or heatwaves occur.

These are among the reasons SRP recently filed a request for the Corporation Commission to reconsider its decision.

This is not a request we take lightly. Without the power capacity from Coolidge, used mainly to meet the highest energy demand, or “peak demand,” during hot summer days, our customers will be at risk of outages along with the many dangers associated with that.

SRP is addressing Randolph's concerns

SRP recognizes the existing power plant is located adjacent to Randolph, a historically African American community. The expanded plant would continue to comply with all state and federal air quality regulations, which are protective of human health and the environment.

SRP has proposed approximately $18 million in support projects directly addressing Randolph’s interests and concerns, including road paving, scholarships and job training, and landscaping to screen the expansion and beautify the area.

Another go:SRP raises offer to residents for Coolidge gas plant expansion

With the appeal, in the event of an approval of the Certificate of Environmental Compatibility, SRP is proposing additional measures including home repairs and energy efficiency improvements and a community center.

This is a long-term commitment to help preserve Randolph’s history and ensure its approximately 150 residents thrive in their homes for decades to come.

We're investing in solar and battery storage

To put the committed value in context, when SRP expanded its Santan Generating Station located in Gilbert, the total value of that project was estimated at $20 million, with more than 16,000 houses in the 2-mile area surrounding the facility.

The proposed support for the Randolph community equates to approximately $120,000 per household, which far exceeds Santan’s per-household mitigation, which equated to $1,250 per household.

Sustainable transformation of the electric industry will benefit our customers and the environment, but only if done in a reliable manner. SRP plans to add 450 megawatts of battery storage by 2023 – one of the largest battery storage commitments in the West.

Half of SRP’s power generation will come from carbon-free resources by 2025. In this time frame, we plan to install 2,025 megawatts of new solar energy, which, when available, is enough to power more than 450,000 average-size homes. However, that is not enough to reliably serve our customers.

But we still need a bridge to that future

Unfortunately, battery storage will not provide adequate energy to reliably meet near-term customer needs either. This technology is still developing.

As one example: A battery storage project from which SRP purchases power caught fire last month. In California, the world’s largest battery project, Moss Landing, has been offline since February after an overheating incident.

Many battery projects are experiencing supply chain difficulties and may not be online by 2024 when SRP needs the power.

Arizona’s record of reliable and affordable power will end if we don’t construct proven and reliable resources like the Coolidge Expansion Project that provide backup energy when it’s not available from renewable resources.

We hope the Corporation Commission revisits its decision and grants the Certificate of Environmental Compatibility for the proposed expansion, bridging us to a clean energy future.

Mike Hummel is general manager and CEO of Salt River Project. Share your thoughts at Cindy.Brown@srpnet.com.

This article originally appeared on Arizona Republic: SRP could face blackouts if Coolidge plant isn't expanded