Tri-State agrees to energy study

DENVER — One more legal challenge to power supplier Tri-State's attempt to change water right usage near Lamar was ended by a settlement last week.

The result is a study of Tri-State's energy efficiency — one an environmental group hopes will show Tri-State can meet customer needs without a change in use of 20,000 acre-feet of John Martin Reservoir water.

Environment Colorado sued Tri-State Generation and Transmission Association 18 months ago, after the company, which supplies wholesale power to Delta-Montrose Electrical Association and other cooperatives, filed for a change of water use, from agricultural to industrial, on the reservoir.

Tri-State still hopes to acquire the use-change right, which it says is needed for a proposed new power plant to offset the growth the generation company is seeing among member usage. It has settled with a total of 19 plaintiffs, most recently EC. One challenger remains.

Environment Colorado spokesman Keith Hay said EC wanted to Tri-State to look at the least costly alternative for their power customers first and, "that will always be energy efficiency."

He said Tri-State approached EC to settle the action, which EC agreed to consider, provided Tri-State made steps toward proving its energy efficiency.

Hay said both parties realized there was no basis to establish where Tri-State was in terms of energy efficiency, so the first logical step was a study.

Tri-State and EC signed a settlement Feb. 4 that requires Tri-State to hire a third-party contractor to conduct a demand side management-energy efficiency study and to prepare annual reports on those activities.

In return, EC withdrew its statement of opposition and agreed "not to raise water injury issues or the issues raised in EC's motion for summary judgment specific to the Colorado Power Project."

"We feel this study will show Tri-State doesn't need the plant they have currently proposed," Hay said. "This meets our goal of protecting the water right, or at a minimum, doing it carefully and responsibly if we're going to make that change."

Tri-State spokesman Lee Boughey said the study would be valuable in bolstering Tri-State's energy efficiency programs and resource planning, however, the plant was still necessary.

Boughey said Tri-State has seen its member systems grow by an average of 4 percent each year for the past decade. The new plant would help address that growth rate.

"Energy efficiency is an important part of  resource planning. We expect this study to provide further information as to how Tri-State can institute best-use practices," he said.

"... we are continuing to invest into new renewable and new conventional resources as part of a balanced resource plan."

Under the agreement, Tri-State will spend between $500,000 and $1 million on the study, to be completed by 2010.

The study is to assess technical, economic and practical potential for efficient energy use and peak load reduction in its service areas through 2020. Environment Colorado has the right to review and comment on the methodology as well as to provide input.

The first draft of three reports on testing activities is to be completed in the first quarter of 2010.

"We think the dollar value is just right and their commitment to hiring an outside contractor is an important step. We believe it will give us a study all parties can look to as definitive on the resources Tri-State has," Hay said.

"Especially at a time right now of economic hardship for Coloradans, making an efficiency study is the best place to start meeting efficiency needs."

Boughey said Tri-State hopes to reach an agreement with the final plaintiff before the next court date in March.