Tri-State Generation and Transmission Association has added a new member that is its first non-utility member.
Tuesday, Tri-State announced MIECO Inc., a wholesale energy services company that supplies natural gas to purchasers, including Tri-State, had joined more than 40 electrical cooperatives as a Tri-State member.
By adding a non-utility member to its membership, Tri-State becomes subject to the Federal Energy Regulatory Commission’s rate authority rules.
The power wholesaler’s previously voted to add a membership classification that would put it under FERC — a move decried first by local co-op Delta-Montrose Electric Association and, in August, by the Colorado Public Utilities Commission.
The PUC labelled Tri-State’s intent to become FERC-regulated as “procedurally unsound, premature, incomplete and jurisdictionally problematic,” according to an Aug. 19 report by The Colorado Sun.
Tri-State was said to be reviewing the PUC’s protest.
Tri-State previously said it wanted FERC regulation for across-the-board rate stability in all of the states where it serves cooperatives.
It voted to add the necessary membership class in early July, sparking protests from cooperatives, including DMEA.
The local cooperative recently brokered an exit fee to buy out its contract with Tri-State, which is to become effective next May; for now, DMEA is still served by Tri-State.
Tri-State made a formal tariff application with FERC July 23. Such filings are usually accepted within 60 days.
“Tri-State is rapidly changing to be increasingly clean with more renewable resources,” said Duane Highley, CEO of Tri-State, in a provided statement Tuesday, concerning the addition of MIECO.
“Natural gas generation helps us reliably integrate renewables. Adding MIECO to our membership helps ensure that we have enough firm natural gas pipeline transportation capacity and fuel to supply our existing and any new natural-gas fired power plants.”
A subsidiary of Marubeni Corp., headquartered in California, MIECO will help Tri-State meet the challenges of the current utility market, the association’s news release said.
“MIECO looks forward to partnering as a member of Tri-State. Our membership helps us deepen our relationship with Tri-State and recognizes the importance of natural gas for reliability in their transition to renewables,” said Dave Engbrock, vice president of MIECO, in the news release.
“We have been working with MIECO for years, and today we are further aligning our interests to the benefit of all our cooperative’s members,” said Tri-State Chairman Rick Gordon. “MIECO will be eligible for patronage capital allocations and have voting rights at all membership meetings, but will not have a seat on the Tri-State Board of Directors.”
Tri-State says its move to FERC rate-regulation is consistent with other similar wholesale generation and transmission providers that faced disparate rate treatment by different state regulators. Under FERC, Tri-State has consistent regulation and resolution in a single place. Rate-regulation by FERC does not affect Tri-State’s compliance with state resource planning, carbon reduction or renewable energy regulations, Tri-State in its news release reiterated.
“Tri-State has and will continue to comply with state environmental, renewable energy and resource planning requirements, and will continue to do so under FERC rate regulation,” Highley said.
“The issue of FERC rate regulation is unrelated to those areas regulated by the states. We are committed, and required, to work with all New Mexico and Colorado state regulatory agencies, including the Colorado Public Utilities Commission on resource planning and the Colorado Air Quality Control Commission on carbon reduction planning.”